78R6954 EMT-F

By:  Flores                                                       H.B. No. 2441



A BILL TO BE ENTITLED

AN ACT

relating to the regulation of amusement redemption machines.                  
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.   Chapter 2153, Occupations Code, is amended by 
adding Subchapter K to read as follows:

SUBCHAPTER K.  AMUSEMENT REDEMPTION MACHINES
	Sec. 2153.501.  AMUSEMENT REDEMPTION MACHINE DEFINED.  (a)  
In this subchapter, "amusement redemption machine":
		(1)  means a skill or pleasure coin-operated machine 
that is designed, made, and adapted solely for bona fide amusement 
purposes, and that by operation of chance or a combination of skill 
and chance affords the user, in addition to any right of replay, an 
opportunity to receive exclusively noncash merchandise prizes, 
toys, or novelties, or a representation of value redeemable for 
those items, that have a wholesale value from a single play of the 
machine of not more than 10 times the amount charged to play the 
machine once or $5, whichever is less; and
		(2)  does not include:                                                 
			(A)  a machine that awards the user noncash 
merchandise prizes, toys, or novelties solely and directly from the 
machine, including claw, crane, or similar machines; or
			(B)  a machine from which the opportunity to 
receive a prize or a representation of value redeemable for a prize 
varies depending on the user's ability to throw, roll, flip, toss, 
hit, or drop a ball or other physical object into the machine or a 
part of the machine, including basketball, skeeball, golf, bowling, 
pusher, or similar machines.
	(b)  For purposes of this section:                                      
		(1)  a coin-operated machine includes a machine or 
device operated by the payment or insertion of paper currency or any 
other consideration; and
		(2)  a representation of value includes a gift 
certificate or gift card that is presented to a merchant in exchange 
for merchandise.
	Sec. 2153.502.  REGULATORY AUTHORITY.  (a)  The comptroller 
shall adopt rules for regulating the exhibition, display, 
operation, promotion, and use of amusement redemption machines.
	(b)  Nothing in this chapter limits the authority of a 
political subdivision of this state to regulate the location of 
amusement redemption machines as permitted by Section 2153.452.
	Sec. 2153.503.  ADDITIONAL TAX PERMIT PROVISIONS APPLICABLE 
TO AMUSEMENT REDEMPTION MACHINES. (a)  A tax permit issued for an 
amusement redemption machine must state the physical street address 
designated by the license holder when the permit is issued, and is 
valid only while affixed to the machine at that address.
	(b)  The rate of the occupation tax imposed under Section 
2153.401 for each amusement redemption machine exhibited or 
displayed in this state is $120 per year instead of the rate 
prescribed by that section.
	Sec. 2153.504.  ADDITIONAL GENERAL BUSINESS LICENSE 
PROVISIONS APPLICABLE TO AMUSEMENT REDEMPTION MACHINES.  (a)  An 
application for a license under Subchapter D for a person engaging 
in a business for which a license is required by Section 2153.151 
that involves amusement redemption machines must, in addition to 
the information required by Section 2153.153, include the physical 
street address at which any amusement redemption machine is or will 
be located.
	(b)  A license holder shall display the license at all times 
in a conspicuous place in each location where any amusement 
redemption machines are operated under the license.
	(c)  Notwithstanding Section 2153.154(a), the annual fee for 
a general business license issued under Subchapter B for a business 
that involves amusement redemption machines is $2,000 for an 
applicant without regard to the number of amusement redemption 
machines covered by the license.
	Sec. 2153.505.  OWNER OR EXHIBITOR OF AMUSEMENT REDEMPTION 
MACHINES NOT EXEMPT.  The exemptions provided by Section 2153.008 
do not apply to a person who owns or exhibits an amusement 
redemption machine.
	SECTION 2.  This Act takes effect immediately if it receives 
a vote of two-thirds of all the members elected to each house, as 
provided by Section 39, Article III, Texas Constitution.  If this 
Act does not receive the vote necessary for immediate effect, this 
Act takes effect September 1, 2003.