81R2661 YDB-D

By: Flores H.B. No. 3815

A BILL TO BE ENTITLED

AN ACT

relating to the operation and regulation of charitable bingo.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 2001.002, Occupations Code, is amended by adding Subdivisions (4-a), (8-a), and (25-a) and amending Subdivision (11) to read as follows:

(4-a) "Bingo chairperson" means an officer of a licensed authorized organization who is designated in writing by the organization as responsible for overseeing the organization's bingo activities and reporting to the membership relating to those activities.

(8-a) "Crime of moral turpitude" means:

(A) a felony;

(B) a gambling offense;

(C) criminal fraud;

(D) forgery;

(E) theft;

(F) an offense that involves filing false information with a governmental agency; or

(G) any offense that:

(i) is classified in this state as a Class A misdemeanor; and

(ii) puts the honesty and integrity of the individual who committed the offense in question.

(11) "Fraternal organization" means any of the following other than an organization whose members are predominantly veterans or dependents of veterans of the armed services of the United States:

(A) a nonprofit organization organized to perform and engaged primarily in performing charitable, benevolent, patriotic, employment-related, or educational functions that meet the other requirements of this chapter; [or]

(B) a nonprofit National Historical District Association representing the owners and lessees of a majority of the real property located in a National Historical District designated for not less than three [five] years by the National Register of Historic Places, Heritage Conservation and Recreation Service of the United States Department of the Interior, if the association's net proceeds are used for restoration, construction, maintenance, and security in the district; or

(C) an organization that is exempt from federal income taxes under Section 501(a), Internal Revenue Code of 1986, by being listed as an exempt organization under Section 501(c)(2), (3), (4), (5), (6), (7), (8), (9), (10), or (13), Internal Revenue Code of 1986. [The term "fraternal organization" does not include an organization whose members are predominantly veterans or dependents of veterans of the armed services of the United States.]

(25-a) "Regular license" means a license to conduct bingo that is issued by the commission and that expires on the first or second anniversary of the date of issuance unless revoked or suspended before that date by the commission. The term includes an annual license.

SECTION 2. Section 2001.101(a), Occupations Code, is amended to read as follows:

(a) The commission may license a person who is an authorized organization eligible for a license to conduct bingo if the person is:

(1) a religious society that has existed in this state for at least three [eight] years;

(2) a nonprofit organization:

(A) whose predominant activities are for the support of medical research or treatment programs; and

(B) that for at least three years:

(i) must have had a governing body or officers elected by a vote of members or by a vote of delegates elected by the members; or

(ii) must have been affiliated with a state or national organization organized to perform the same purposes as the nonprofit organization;

(3) a fraternal organization;

(4) a veterans organization that has existed in this state for at least three years; [or]

(5) a volunteer fire department that has existed in this state for at least three years; or

(6) a volunteer emergency medical services provider that has existed in this state for at least three years.

SECTION 3. Sections 2001.102(a) and (b), Occupations Code, are amended to read as follows:

(a) An applicant for a license to conduct bingo must file with the commission an [a written, executed, and verified] application on a form prescribed by the commission.

(b) The application must include:

(1) the name and address of the applicant;

(2) the names and addresses of the applicant's officers and directors;

(3) the address of the premises where and the time when the applicant intends to conduct bingo under the license sought;

(4) the name and address of the licensed commercial lessor of the premises, if the applicant intends to lease premises to conduct bingo from a person other than an authorized organization;

(5) [the capacity or potential capacity for public assembly in any premises owned or occupied by the applicant;

[(6) the amount of rent to be paid or other consideration to be given, directly or indirectly, for each occasion for use of the premises of another licensed authorized organization or for use of the premises of a licensed commercial lessor;

[(7) all other items of expense intended to be incurred or paid in connection with conducting, promoting, and administering bingo and the names and addresses of the persons to whom, and the purposes for which, the expenses are to be paid;

[(8) the specific purposes to and the manner in which the net proceeds of bingo are to be devoted;

[(9)] a statement that the net proceeds of bingo will go to one or more of the authorized charitable purposes under this chapter;

(6) [(10)] a designation of the organization's bingo chairperson [one or more active members of the applicant organization] under whom bingo will be conducted accompanied by a statement signed by the chairperson [each designated member] stating that the chairperson [member] will be responsible for the conduct of bingo under the terms of the license and this chapter;

(7) [(11) a statement that a copy of the application has been sent to the appropriate governing body;

[(12) the name and address of each person who will work at the proposed bingo occasion, the nature of the work to be performed, and a statement as to whether the person has been convicted of a felony, a gambling offense, criminal fraud, or a crime of moral turpitude; and

[(13)] sufficient facts relating to the applicant's incorporation and organization to enable the commission to determine whether the applicant is an authorized organization;

(8) a copy of the applicant organization's most recently filed Internal Revenue Service Form 990, if applicable;

(9) a letter of good standing from the applicant organization's parent organization, if the organization receives an exemption from federal income taxes as a member of a group of organizations;

(10) copies of the applicant organization's organizing instruments, including any bylaws, constitution, charter, and articles of incorporation;

(11) verification of the applicant organization's good standing with the secretary of state if the organization is organized under the law of this state; and

(12) information necessary to conduct criminal background checks on the applicant organization's officers and directors.

SECTION 4. Section 2001.103(e), Occupations Code, is amended to read as follows:

(e) Notwithstanding Subsection (c), an authorized organization that holds a regular license to conduct bingo may receive not more than 24 [12] temporary licenses during the 12-month period following the issuance or renewal of the license.

SECTION 5. Sections 2001.104(b) and (d), Occupations Code, are amended to read as follows:

(b) The commission by rule shall establish procedures to determine if the appropriate license fee [At the end of the license period the license holder and the commission shall compute the amount of gross receipts actually recorded during the license period to determine if the appropriate fee amount] was paid.

(d) An applicant shall pay the fees established under Subsection (a) annually. An applicant for a license or renewal of a license may obtain a license that is effective for two years by paying an amount equal to two times the amount of the annual license fee, or by paying the license fee for the first year at the time the applicant submits the application and the fee for the second year not later than the first anniversary of the date the license becomes effective [plus $25].

SECTION 6. Section 2001.105(b), Occupations Code, is amended to read as follows:

(b) The commission may not issue a license to an authorized organization to conduct bingo if an officer or director of the organization has been convicted of a felony, criminal fraud, a gambling or gambling-related offense, or a crime of moral turpitude if less than 10 years has elapsed since the termination of a sentence, parole, mandatory supervision, or community supervision served for the offense.

SECTION 7. Section 2001.106, Occupations Code, is amended to read as follows:

Sec. 2001.106. FORM AND CONTENTS OF LICENSE. A license to conduct bingo must include:

(1) the name and address of the license holder;

(2) the names and addresses of the member or members of the license holder under whom the bingo will be conducted; and

(3) the address [an indication] of the premises where and the time when bingo is to be conducted[;

[(4) the specific purposes to which the net proceeds of bingo are to be devoted; and

[(5) a statement of whether a prize is to be offered and the amount of any authorized prize].

SECTION 8. Section 2001.107(a), Occupations Code, is amended to read as follows:

(a) Unless the organization is a member of a unit that designates a unit manager under Section 2001.437, the bingo chairperson for a licensed authorized organization [The person designated under Section 2001.102(b)(10)] shall complete the [eight hours of] training required [as provided] by commission rule. For a unit operating under Subchapter I-1, the unit manager shall complete the training if the unit designates a unit manager under Section 2001.437.

SECTION 9. Sections 2001.158(b) and (d), Occupations Code, are amended to read as follows:

(b) The commission by rule shall establish procedures for determining if the appropriate license fee [At the end of the license period, the license holder and the commission shall compute the amount of the gross rentals actually recorded during the license period to determine if the appropriate fee amount] was paid.

(d) An applicant for a commercial lessor license shall pay the fees established under Subsection (a) annually. An applicant for a license or renewal of a license may obtain a license that is effective for two years by paying an amount equal to two times the amount of the annual license fee, or by paying the license fee for the first year at the time the applicant submits the application and the license fee for the second year not later than the first anniversary of the date the license becomes effective [plus $25].

SECTION 10. The heading to Section 2001.159, Occupations Code, is amended to read as follows:

Sec. 2001.159. LICENSE ISSUANCE OR RENEWAL.

SECTION 11. Section 2001.159(a), Occupations Code, is amended to read as follows:

(a) The commission shall issue or renew a commercial lessor license if the commission determines that:

(1) the applicant has paid the license fee as provided by Section 2001.158;

(2) the applicant qualifies to be licensed under this chapter;

(3) [the applicant satisfies the requirements for a commercial lessor under this subchapter;

[(4)] the rent to be charged is fair and reasonable [and will be charged and collected in compliance with Section 2001.406];

(4) [(5) there is no diversion of the funds of the proposed lessee from the lawful purposes under this chapter;

[(6)] the person whose signature or name appears in the application is in all respects the real party in interest and is not an undisclosed agent or trustee for the real party in interest; and

(5) [(7)] the applicant will lease the premises for the conduct of bingo in accordance with this chapter.

SECTION 12. Section 2001.203, Occupations Code, is amended to read as follows:

Sec. 2001.203. MANUFACTURER'S LICENSE APPLICATION. (a) An applicant for a manufacturer's license must file with the commission an [a written verified] application on a form prescribed by the commission.

(b) The application must include:

(1) the name and address of the applicant and the name and address of each of its locations where bingo supplies or equipment are manufactured;

(2) a full description of each type of bingo supply or equipment that the applicant intends to manufacture or market in this state and the brand name, if any, under which each item will be sold;

(3) [the name and address of the applicant and] if the applicant:

(A) is not a corporation, the name and home address of each owner; or

(B) is a corporation, the name and home address of each officer and director and each person owning more than 10 percent [or more] of a class of stock in the corporation;

(4) if the applicant is a foreign corporation or other foreign legal entity, the name, business name and address, and [home] address of its registered agent for service in this state;

(5) the name and address of each manufacturer, supplier, and distributor in which the applicant has a financial interest and the details of that financial interest, including any indebtedness between the applicant and the manufacturer, supplier, or distributor of $5,000 [$500] or more;

(6) information regarding whether the applicant or a person required to be named in the application has been convicted in this state or another state of a felony, criminal fraud, a gambling or gambling-related offense, or a crime of moral turpitude;

(7) information regarding whether the applicant or a person required to be named in the application is an owner, officer, director, shareholder, agent, or employee of a licensed commercial lessor or conducts, promotes, administers, or assists in conducting, promoting, or administering bingo for which a license is required by this chapter;

(8) information regarding whether the applicant or a person required to be named in the application is a public officer or public employee in this state;

(9) the name of each state in which the applicant is or has been licensed to manufacture, distribute, or supply bingo equipment or supplies, each license number, the period of time licensed under each license, and whether a license has been revoked, suspended, withdrawn, canceled, or surrendered and, if so, the reasons for the action taken;

(10) information regarding whether the applicant or a person required to be named in the application is or has been a professional gambler or gambling promoter;

(11) the names and addresses of each manufacturer, supplier, or distributor of bingo equipment or supplies in which the applicant or a person required to be named in the application is an owner, officer, shareholder, director, agent, or employee; and

(12) any other information the commission requests.

SECTION 13. Section 2001.208(b), Occupations Code, is amended to read as follows:

(b) The application must include:

(1) the full name and address of the applicant;

(2) the name and address of each location operated by the distributor from which bingo supplies or equipment are distributed or at which bingo supplies or equipment are stored;

(3) if a noncorporate distributor, the name and home address of each owner;

(4) if a corporate distributor, the name and home address of each officer or director and of each person owning more than [at least] 10 percent of a class of stock in the corporation;

(5) if a foreign corporation or other foreign legal entity, the name, business name and address, and [home] address of its registered agent for service in this state;

(6) a full description of the type of bingo supply or equipment that the applicant intends to store or distribute in this state and the name of the manufacturer of each item and the brand name, if any, under which the item will be sold or marketed;

(7) the name and address of a manufacturer, supplier, or distributor in which the applicant has a financial interest and the details of that financial interest, including an indebtedness between the applicant and the manufacturer, supplier, or distributor of $5,000 [$500] or more;

(8) information regarding whether the applicant or a person required to be named in the application has been convicted in this state or another state of a felony, criminal fraud, a gambling or gambling-related offense, or a crime of moral turpitude;

(9) information regarding whether the applicant or a person required to be named in the application is an owner, officer, director, shareholder, agent, or employee of a licensed commercial lessor or conducts, promotes, administers, or assists in conducting, promoting, or administering bingo for which a license is required under this chapter;

(10) information regarding whether the applicant or a person required to be named in the application is a public officer or public employee in this state;

(11) the name of each state in which the applicant is or has been licensed to manufacture, distribute, or supply bingo equipment or supplies, each license number, the period of time licensed under each license, and whether a license was revoked, suspended, withdrawn, canceled, or surrendered and, if so, the reasons for the action taken;

(12) information regarding whether the applicant or a person required to be named in the application is or has been a professional gambler or gambling promoter;

(13) the name and address of each manufacturer, supplier, or distributor of bingo equipment or supplies in which the applicant or a person required to be named in the application is an owner, officer, shareholder, director, agent, or employee; and

(14) any other information the commission requests.

SECTION 14. Section 2001.306(c), Occupations Code, is amended to read as follows:

(c) The holder of a license to conduct bingo may not change the location at which it conducts bingo until it has:

(1) returned [surrendered] its original license if available, or certified that the license is not available; and

(2) received an amended license for the new location.

SECTION 15. Section 2001.313, Occupations Code, is amended by amending Subsections (a), (b), (d), (e), (f), and (g) and adding Subsections (b-1), (h), and (i) to read as follows:

(a) To minimize duplicate criminal history background checks by the commission and the costs incurred by organizations and individuals, the commission shall maintain a registry of individuals [persons] on whom the commission has conducted a criminal history background check and who are approved to be involved in the conduct of bingo or to act as a bingo operator.

(b) An individual [A person] listed in the registry may be involved in the conduct of bingo or act as an operator at any location at which bingo is lawfully conducted.

(b-1) An individual's listing on the registry expires on the third anniversary of the date the individual was initially included on the registry. The individual may renew the listing before the expiration date. If the individual fails to renew the listing, the commission shall remove the individual's name from the registry. An individual whose name is removed from the registry may reapply for listing on the registry.

(d) An individual [A person] who is not listed on the registry established by this section may not act, and a licensed authorized organization may not allow the individual to act, as an operator, manager, cashier, usher, caller, bingo chairperson, bookkeeper, or salesperson for the [a] licensed authorized organization.

(e) The commission may refuse to add an individual's [a person's] name to, or remove an individual's [a person's] name from, the registry established by this section if, after notice and, if requested by the individual, a hearing, the individual [person] is finally determined to have:

(1) been convicted of an offense listed under Section 2001.105(b);

(2) converted bingo equipment in a premises to an improper use;

(3) converted funds that are in, or that should have been in, the bingo account of any licensed authorized organization;

(4) taken any action, individually or in concert with another person, that affects the integrity of any bingo game to which this chapter applies; [or]

(5) acted as an operator, manager, cashier, usher, caller, bingo chairperson, bookkeeper, or salesperson for a licensed authorized organization without being listed on the registry established under this section;

(6) failed to provide a complete application; or

(7) participated in any violation of this chapter or rules adopted by the commission for the administration of this chapter.

(f) A licensed authorized organization shall report to the commission or its designee the discovery of any conduct on the part of an individual [a person] registered or required to be registered under this section where there is substantial basis for believing that the conduct would constitute grounds for removal of the individual's [person's] name from, or refusal to add the individual's [person's] name to, the registry established by this section. A statement made in good faith to the commission or to an adjudicative body in connection with any such report may not be the basis for an action for defamation of character.

(g) An individual [A person] who has been finally determined to have taken action prohibited by Subsection (e)(2), (3), (4), [or] (5), (6), or (7) cannot be listed on the registry of approved bingo workers and cannot work as a bingo worker for one year from the date of such determination. Upon expiration of the one-year period, the individual [person] is eligible for listing on the registry provided a license holder [licensee] subject to this chapter makes application to list the individual [person]. In such event, the commission shall take into consideration the facts and circumstances that occurred that led to the applicable action under Subsections (e)(2)-(7) [(e)(2)-(5)] in deciding whether to list the individual [person] on the registry.

(h) A licensed authorized organization may employ an individual who is not on the registry established by this section as an operator, manager, cashier, usher, caller, or salesperson on a provisional basis if the individual is awaiting the results of a background check by the commission:

(1) for a period not to exceed 14 days if the individual is a resident of this state; or

(2) for a period to be established by commission rule if the individual is not a resident of this state.

(i) An individual who has been removed from the registry under Subsection (e) and has not subsequently been listed on the registry under Subsection (g) may not be employed under Subsection (h).

SECTION 16. Subchapter G, Chapter 2001, Occupations Code, is amended by adding Sections 2001.315 and 2001.316 to read as follows:

Sec. 2001.315. LATE LICENSE RENEWAL. (a) A person who fails to renew the person's license under this chapter before the date the license expires may renew the license after the expiration date by:

(1) filing a license renewal application with the commission not later than the 14th day after the date the license expires, paying the applicable annual license fee, and paying a late license renewal fee equal to 10 percent of the annual license fee; or

(2) filing a license renewal application with the commission not later than the 60th day after the date the license expires, paying the applicable annual license fee, and paying a late license renewal fee equal to 10 percent of the annual license fee for each 14-day period occurring after the date the license expires and before the date the renewal application is filed with the commission.

(b) A person who files a renewal application with the commission under Subsection (a) may continue to perform the bingo activities authorized under the license as if the license has not expired until the license is renewed or renewal of the license is denied.

(c) To renew a license after the 60th day after the date the license expires, the person must file an application for an original license and cease all bingo activities for which the license is required as of the 61st day after the date the license expires until a new license is issued.

Sec. 2001.316. DELIVERY OF COMMISSION NOTICE. If notice under this chapter is required to be given to an authorized organization, the commission shall send the notice to the bingo chairperson of the authorized organization and to the appropriate commercial lessor, if applicable.

SECTION 17. Section 2001.407(a), Occupations Code, is amended to read as follows:

(a) A licensed manufacturer may furnish, by sale or otherwise, bingo equipment or supplies to a licensed distributor. A [Except as provided by Section 2001.257(b), a] licensed manufacturer may not furnish, by sale or otherwise, bingo equipment or supplies to a person other than a licensed distributor.

SECTION 18. Section 2001.411, Occupations Code, is amended by adding Subsection (c-1) to read as follows:

(c-1) An organization may designate as members of the organization one or more individuals who elect to become members, including all of the organization's directors, and the designated members are bona fide members of the organization for purposes of this section and other law.

SECTION 19. The following provisions of the Occupations Code are repealed:

(1) Sections 2001.002(3) and (10);

(2) Section 2001.057(b);

(3) Section 2001.160(c);

(4) Section 2001.161(a);

(5) Section 2001.204;

(6) Section 2001.305;

(7) Section 2001.553(b); and

(8) Subchapter F, Chapter 2001.

SECTION 20. The Texas Lottery Commission shall adopt the rules required by Chapter 2001, Occupations Code, as amended by this Act, not later than April 1, 2010.

SECTION 21. (a) The change in law made by this Act applies only to an offense committed on or after the effective date of this Act. For purposes of this section, an offense is committed before the effective date of this Act if any element of the offense occurs before that date.

(b) An offense committed before the effective date of this Act is covered by the law in effect when the offense was committed, and the former law is continued in effect for that purpose.

SECTION 22. This Act takes effect October 1, 2009.