Relating to the transfer of the licensing and regulation of charitable bingo to the Texas Commission of Licensing and Regulation.

89(R) SB 1721 - Engrossed version - Bill Text

By: Middleton, Hall

S.B. No. 1721

A BILL TO BE ENTITLED

AN ACT

relating to the transfer of the licensing and regulation of

charitable bingo to the Texas Commission of Licensing and

Regulation.

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

SECTION 1. Section 411.093(a), Government Code, is amended

to read as follows:

(a) The Texas Department of Licensing and Regulation is

entitled to obtain criminal history record information as provided

by Subsection (b) that relates to:

(1) an applicant for or the holder of:

(A) a driver education instructor license under

Chapter 1001, Education Code;

(B) a license under Chapter 202, Occupations

Code;

(C) a license under Chapter 401, Occupations

Code;

(D) a license under Chapter 402, Occupations

Code; or

(E) an instructor license or motorcycle school

license under Chapter 662, Transportation Code;

(2) a person who is:

(A) an applicant for or the holder of a license

under Chapter 91, Labor Code; or

(B) a controlling person, as defined by Chapter

91, Labor Code, of an entity described by Paragraph (A); [
or
]

(3) a person who:

(A) is an applicant for or the holder of a license

under Chapter 455, Occupations Code; or

(B) has an interest described under Section

455.1525(e), Occupations Code, in an entity described by Paragraph

(A)
; or

(4) a person who:

(A)

is an applicant for or the holder of a license

under Chapter 2001, Occupations Code; or

(B)

has an interest described under Section

2001.3025(e), Occupations Code, in an entity described by Paragraph

(A)
.

SECTION 2. Section 411.108(a-2), Government Code, is

amended to read as follows:

(a-2) Subject to Sections 411.087, 466.201, and 467.036(b)

[
of this code and Section 2001.3025, Occupations Code,
] and

consistent with the public policy of this state, the Texas Lottery

Commission is entitled to:

(1) obtain through the Federal Bureau of Investigation

criminal history record information maintained or indexed by that

bureau that pertains to a person described by Subsection (a) [
or

(a-1)
]; and

(2) obtain from the department or any other criminal

justice agency in this state criminal history record information

maintained by the department or that criminal justice agency that

relates to a person described by Subsection (a) [
or (a-1)
].

SECTION 3. Sections 466.002(2) and (3), Government Code,

are amended to read as follows:

(2) "Director" means the
lottery
director [
of the

division
].

(3) "Division" means the
commission or a
lottery

division established by the commission [
under Chapter 467
].

SECTION 4. Section 467.002, Government Code, is amended to

read as follows:

Sec. 467.002. APPLICATION OF SUNSET ACT. The commission is

subject to review under Chapter 325 (Texas Sunset Act). Unless

continued in existence as provided by that chapter, the commission

is abolished and this chapter
and
[
,
] Chapter 466 [
of this code, and

Chapter 2001, Occupations Code,
] expire September 1, 2025.

SECTION 5. Sections 467.024(a) and (c), Government Code,

are amended to read as follows:

(a) An individual is not eligible to be an appointed member

of the commission if the individual:

(1) is registered, certified, or licensed by a

regulatory agency in the field of [
bingo or
] lottery;

(2) owns or controls, directly or indirectly, more

than a 10 percent interest in a business entity or other

organization regulated by the commission or receiving funds from

the commission;

(3) is employed by or participates in the management

of a business entity or other organization regulated by or

receiving funds from the commission;

(4) uses or receives a substantial amount of tangible

goods, services, or funds from the commission, other than

compensation or reimbursement authorized by law for commission

membership, attendance, or expenses;

(5) is an officer, employee, or paid consultant of a

Texas trade association in the field of [
bingo or
] lottery;

(6) is required to register as a lobbyist under

Chapter 305 because of the person's activities for compensation on

behalf of a profession related to the operation of the commission;

(7) is married to an individual described by

Subdivisions (2)-(6);

(8) has been convicted of a felony or of any crime

involving moral turpitude; or

(9) is not a citizen of the United States.

(c) A person may not be a commission employee employed in a

"bona fide executive, administrative, or professional capacity,"

as that phrase is used for purposes of establishing an exemption to

the overtime provisions of the federal Fair Labor Standards Act of

1938 (29 U.S.C. Section 201 et seq.), if:

(1) the person is an officer, employee, or paid

consultant of a Texas trade association in the field of [
bingo or
]

lottery; or

(2) the person's spouse is an officer, manager, or paid

consultant of a Texas trade association in the field of [
bingo or
]

lottery.

SECTION 6. Section 467.025(a), Government Code, is amended

to read as follows:

(a) A commission member may not:

(1) accept any employment or remuneration from[
:

[
(A)
] a person that has a significant financial

interest in the lottery[
; or

[
(B)

a bingo commercial lessor, bingo

distributor, or bingo manufacturer
];

(2) play any lottery [
or bingo
] game conducted in this

state;

(3) accept or be entitled to accept any part of the

winnings to be paid from a lottery [
or bingo
] game conducted in this

state;

(4) use the member's official authority to affect the

result of an election or nomination for public office; or

(5) directly or indirectly coerce, attempt to coerce,

command, or advise a person to pay, lend, or contribute anything of

value to another person for political purposes.

SECTION 7. Section 467.035(a), Government Code, is amended

to read as follows:

(a) The commission may not employ or continue to employ a

person who owns a financial interest in[
:

[
(1)

a bingo commercial lessor, bingo distributor, or

bingo manufacturer; or

[
(2)
] a lottery sales agency or a lottery operator.

SECTION 8. Sections 467.101(a) and (c), Government Code,

are amended to read as follows:

(a) The commission has broad authority and shall exercise

strict control and close supervision over all activities authorized

and conducted in this state under[
:

[
(1) Chapter 2001, Occupations Code; and

[
(2)
] Chapter 466 [
of this code
].

(c) The commission also has the powers and duties granted

under[
:

[
(1) Chapter 2001, Occupations Code; and

[
(2)
] Chapter 466 [
of this code
].

SECTION 9. Section 467.111(f), Government Code, is amended

to read as follows:

(f) The commission shall prepare a report on the trends and

issues identified under Subsection (e) and make the report

available to the public. The commission shall address the

identified trends and issues, including trends and issues related

to the regulation of lottery operations under Chapter 466 [
and of

bingo under Chapter 2001, Occupations Code
].

SECTION 10. Section 572.003(b), Government Code, is amended

to read as follows:

(b) The term means:

(1) the
banking commissioner of the Texas Department

of
Banking [
Commissioner of The Banking Department of Texas
];

(2) the administrative director of the Office of Court

Administration of the Texas Judicial System;

(3) the chief executive of the Office of Public

Utility Counsel;

(4) the executive director of the State Bar of Texas;

(5) the
lottery
director [
of the lottery division
] of

the Texas Lottery Commission;

(6) the deputy in charge of the department of security

in
a
[
the
] lottery division of the Texas Lottery Commission;

(7) the
executive
director of the [
bingo division of

the
] Texas
Department of Licensing and Regulation
[
Lottery

Commission
]; or

(8) the secretary of state.

SECTION 11. Section 2001.002, Occupations Code, is amended

by amending Subdivisions (8) and (25-a) and adding Subdivision

(8-a) to read as follows:

(8) "Commission" means the Texas [
Lottery
] Commission

of Licensing and Regulation
.

(8-a) "Department" means the Texas Department of

Licensing and Regulation.

(25-a) "Regular license" means a license to conduct

bingo issued by the
department
[
commission
] under Subchapter C that

is not a temporary license.

SECTION 12. Section 2001.003, Occupations Code, is amended

to read as follows:

Sec. 2001.003. REGULATORY FUNDING FROM LICENSE FEES AND

BINGO PRIZE FEES. It is the intent of the legislature that the

funding necessary for the administration of this chapter by the

department
[
commission
] be collected by the
department

[
commission
] from commercial lessor, manufacturer, and distributor

license fees and money paid to the
department
[
commission
] by bingo

players as bingo prize fees.

SECTION 13. Section 2001.051, Occupations Code, is amended

to read as follows:

Sec. 2001.051.
ADMINISTRATION AND PURPOSE OF CHAPTER

[
CONTROL AND SUPERVISION OF BINGO; BINGO DIVISION
]. (a) The

department
[
commission
] shall administer this chapter.

(b) The
purpose of this chapter is to ensure
[
commission has

broad authority and shall exercise strict control and close

supervision over
] all bingo conducted in this state [
so that bingo
]

is fairly conducted and the proceeds derived from bingo are used for

an authorized purpose.

(c)
This chapter does not limit the general powers of the

commission or the department under Chapter 51
[
The commission shall

execute its authority through a bingo division established by the

commission to administer this chapter
].

SECTION 14. Section 2001.057, Occupations Code, is amended

to read as follows:

Sec. 2001.057. BINGO ADVISORY
BOARD
[
COMMITTEE
]. (a) The

commission may
establish
[
appoint
] a bingo advisory
board to advise

the commission and the department on matters related to this

state's bingo industry
[
committee consisting of nine members
].

(b)
The
advisory board must consist of nine
[
commission

shall appoint
] members
appointed by the presiding officer of the

commission, on approval of the commission, and represent

[
representing
] a balance of interests including representatives

of:

(1) the public;

(2) charities that operate bingo games; and

(3) commercial and charity lessors that participate in

the bingo industry.

(c)
The advisory board members serve staggered six-year

terms
[
A committee member serves at the pleasure of the

commission
].

(d)
An advisory board
[
A committee
] member is not entitled

to receive compensation for serving as a member.
An advisory board

[
A committee
] member is entitled to reimbursement for reasonable

expenses incurred in performing duties as a member.

(e)
If a vacancy occurs on the advisory board, the presiding

officer of the commission, on approval of the commission, shall

appoint a replacement who meets the qualifications for the vacant

position to serve for the remainder of the term
[
The committee may:

[
(1)

advise the commission on the needs and problems

of the state's bingo industry;

[
(2)

comment on rules involving bingo during their

development and before final adoption unless an emergency requires

immediate action by the commission;

[
(3)

report annually to the commission on the

committee's activities; and

[
(4)

perform other duties as determined by the

commission
].

(f)
The presiding officer of the commission, on approval of

the commission, shall designate a member of the advisory board to

serve as the presiding officer of the advisory board for two years.

The presiding officer of the advisory board may vote on any matter

before the advisory board
[
The committee may meet quarterly or at

the commission's request
].

(g) The commission may adopt rules to govern the operations

of the
advisory board
[
committee
].

SECTION 15. Sections 2001.060(a) and (c), Occupations Code,

are amended to read as follows:

(a) On or before June 1 of each even-numbered year, the

department
[
commission
] shall prepare and deliver to the governor,

the lieutenant governor, the speaker of the house of

representatives, and the chairs of the standing committees of the

senate and house of representatives with primary jurisdiction over

charitable bingo a report stating for each of the preceding two

calendar years:

(1) the total amount of adjusted gross receipts

reported by licensed authorized organizations from their bingo

operations;

(2) the total amount of net proceeds reported by

licensed authorized organizations from their bingo operations; and

(3) a comparison of the amounts reported under

Subdivisions (1) and (2), including the percentage that the net

proceeds represents of the adjusted gross receipts.

(c) For purposes of Subsection (a), the
department

[
commission
] shall determine the total amount of net proceeds in a

manner that does not reduce gross receipts by the amount of rent

paid for the rental of bingo premises by a licensed authorized

organization to another licensed authorized organization if the

other organization pays rent for the premises to a licensed

commercial lessor.

SECTION 16. Section 2001.101(a), Occupations Code, is

amended to read as follows:

(a) The
department
[
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 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;

(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 17. 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
department
[
commission
] an application on a form

prescribed by the
department
[
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) a statement that the net proceeds of bingo will go

to one or more of the authorized charitable purposes under this

chapter;

(6) a designation of the applicant organization's

bingo chairperson under whom bingo will be conducted accompanied by

a statement signed by the chairperson stating that the chairperson

will be responsible for the conduct of bingo under the terms of the

license and this chapter;

(7) sufficient facts relating to the applicant's

incorporation and organization to enable the
department

[
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 18. Sections 2001.103(a), (e), and (g), Occupations

Code, are amended to read as follows:

(a) An authorized organization may receive a temporary

license to conduct bingo by filing with the
department
[
commission
]

an application, on a form prescribed by the
department

[
commission
].

(e) Notwithstanding any other provision of this subchapter,

the
department
[
commission
] shall issue to an authorized

organization that holds a regular license to conduct bingo 48

temporary licenses for each 12-month period that ends on an

anniversary of the date the regular license was issued or renewed.

Each unused temporary license issued to the license holder expires

on the anniversary of the date the temporary license was issued.

(g) Before using a temporary license issued under

Subsection (e), the license holder shall notify the
department

[
commission
] in the manner the
department
[
commission
] prescribes

of the specific date, time, and location of the bingo occasion for

which the temporary license will be used. The
department

[
commission
] shall provide to the license holder verification of

the
department's
[
commission's
] receipt of the notification. The

license holder shall maintain the verification in the records of

the authorized organization.

SECTION 19. Section 2001.105, Occupations Code, is amended

to read as follows:

Sec. 2001.105. LICENSE ISSUANCE OR RENEWAL. (a) The

department
[
commission
] shall issue a temporary or regular license

or renew a regular license to conduct bingo if the
department

[
commission
] determines that:

(1) the member or members of the applicant designated

in the application to conduct bingo are active members of the

applicant;

(2) the bingo is to be conducted in accordance with

this chapter;

(3) the proceeds of the bingo are to be disposed in

accordance with this chapter;

(4) the applicant has made and can demonstrate

significant progress toward the accomplishment of the purposes of

the organization during the 24 months preceding the date of

application for a license or regular license renewal;

(5) all persons who will conduct, promote, or

administer the proposed bingo are active members of the applicant

organization and all other persons who will assist in conducting,

promoting, or administering the proposed bingo games are persons

authorized to do so by Section 2001.411; and

(6) no person under whose name bingo will be conducted

and no person working at the proposed bingo has been convicted of a

gambling offense or criminal fraud.

(b) The
department
[
commission
] may not issue a license to

an authorized organization to conduct bingo if an officer or member

of the board of directors of the organization has been convicted of

criminal fraud or a gambling or gambling-related offense.

(c) A regular license to conduct bingo issued under this

subchapter expires on the second anniversary of the date of

issuance unless the commission
or the department
revokes or

suspends the license before that date.

SECTION 20. Section 2001.107(b), Occupations Code, is

amended to read as follows:

(b) A training program approved by the
department

[
commission
] must include training related to:

(1) conducting bingo;

(2) administering and operating bingo; and

(3) promoting bingo.

SECTION 21. Section 2001.108, Occupations Code, is amended

to read as follows:

Sec. 2001.108. LICENSE AMENDMENT FOR CHANGE OF BINGO

PREMISES OR OCCASIONS. (a) A licensed authorized organization and

the licensed commercial lessor at which the organization conducts

or will conduct bingo may file a joint application with the

department
[
commission
] to change the premises at which the

organization may conduct bingo or the times of the organization's

bingo occasions to allow the organization to conduct bingo at the

same time and premises that another licensed authorized

organization is licensed to conduct bingo if the other organization

has ceased, or will cease, conducting bingo at that time and

premises. The application must state whether the other

organization has ceased or will cease conducting bingo at that time

and premises because:

(1) the organization has abandoned or will abandon its

licensed time or premises; or

(2) the organization's lease has been or will be

terminated.

(b) If the other organization ceased or will cease

conducting bingo for the reason stated in Subsection (a)(1), the

department
[
commission
] must act on the joint application filed

under Subsection (a) not later than the 14th day after the date the

application is filed with the
department
[
commission
].

(c) If the other organization ceased or will cease

conducting bingo for the reason stated in Subsection (a)(2), the

department
[
commission
] must act on the joint application filed

under Subsection (a) not later than the 14th day after the date the

application is filed with the
department
[
commission
] or the date

on which the termination takes effect, whichever is later.

(d) If the
department
[
commission
] fails to act within the

time provided by Subsection (b) or (c), the licensed authorized

organization may act as if the change in premises or bingo occasions

has been approved by the
department
[
commission
] and may conduct

bingo at the new premises or during the new bingo occasion until the

department
[
commission
] acts on the application.

(e) Notwithstanding Subsection (d), the
department

[
commission
] may issue temporary licenses to one or more licensed

authorized organizations that conduct bingo at the same location as

an organization that has ceased or will cease to conduct bingo,

which are in addition to the number of temporary licenses each

organization is entitled to under another provision of this

chapter. The
department
[
commission
] is not required to act on a

joint application under Subsection (a) within the time provided by

this section if the number of additional temporary licenses is

sufficient to allow the other organizations at the location to

conduct bingo during the licensed times of the organization that

has ceased or will cease to conduct bingo.

SECTION 22. Section 2001.152(a), Occupations Code, is

amended to read as follows:

(a) The
department
[
commission
] may issue a commercial

lessor license only to:

(1) a licensed authorized organization that owns or

leases a premises where bingo is or will be conducted or an

association of licensed authorized organizations that jointly own

or lease premises where bingo is or will be conducted and that the

organization or association leases or offers for lease to one or

more other authorized organizations for the conduct of bingo;

(2) a person who leases premises to a single licensed

authorized organization that subleases or will sublease the

premises to one or more other licensed authorized organizations for

the conduct of bingo; or

(3) a person who leases premises for the total control

and exclusive use of only one licensed authorized organization as

that organization's primary business office.

SECTION 23. Section 2001.153(a), Occupations Code, is

amended to read as follows:

(a) The
department
[
commission
] may not issue a commercial

lessor license to a person unless the
department
[
commission
]

receives evidence the
department
[
commission
] considers adequate

that funds used by the person seeking the license to obtain the

premises, provide the premises with furniture, fixtures, or

equipment, renovate the premises, or provide utilities to the

premises are:

(1) the person's own funds; or

(2) the funds of another person, including loan

proceeds, that:

(A) were obtained in an arms-length transaction

that was commercially reasonable under the circumstances; and

(B) were not obtained under an expectation or

obligation that the person from whom the funds were obtained would

directly participate in, or have a legal interest in, rents

obtained under the license or revenues or profits from the conduct

of bingo on the premises.

SECTION 24. Section 2001.154(a), Occupations Code, is

amended to read as follows:

(a) The
department
[
commission
] may not issue a commercial

lessor license to or renew a commercial lessor license of:

(1) a person convicted of criminal fraud or a gambling

or gambling-related offense;

(2) a public officer who receives any consideration,

direct or indirect, as owner or lessor of premises offered for

conducting bingo;

(3) a person who loans money to an authorized

organization;

(4) a distributor or manufacturer;

(5) a person in which a person covered by Subdivision

(1), (2), (3), or (4) or a person married or related in the first

degree by consanguinity or affinity, as determined under Chapter

573, Government Code, to one of those persons has greater than a 10

percent proprietary, equitable, or credit interest or in which one

of those persons is active or employed;

(6) a foreign corporation or other foreign legal

entity;

(7) an individual who is not a resident of this state;

(8) a corporation or other legal entity owned or

controlled by:

(A) a foreign corporation; or

(B) an individual who is not a resident of this

state; or

(9) a corporation or other legal entity:

(A) whose shares are publicly traded; or

(B) owned or controlled by a corporation whose

shares are publicly traded.

SECTION 25. Section 2001.156(a), Occupations Code, is

amended to read as follows:

(a) An applicant for a commercial lessor license must file

with the
department an
[
commission a written verified
] application

on a form prescribed by the
department
[
commission
].

SECTION 26. Section 2001.157, Occupations Code, is amended

to read as follows:

Sec. 2001.157. SUPPLEMENTAL INFORMATION. At any time the

department
[
commission
], the appropriate governing body, or the

attorney general may make a written request of a commercial lessor

to disclose:

(1) the cost of the premises and appraised value for

property tax purposes or annual net lease rent, whichever is

applicable;

(2) gross rentals received and itemized expenses for

the preceding calendar or fiscal year, if any;

(3) gross rentals, if any, derived from bingo during

the preceding calendar or fiscal year;

(4) the computation by which the proposed rental

schedule was determined;

(5) the number of occasions on which the lessor

anticipates receiving rent for bingo during the next year or

shorter period if applicable and the proposed rent for each of those

occasions;

(6) estimated gross rental income from all other

sources during the next year; and

(7) estimated expenses itemized for the current year

and the amount of each item allocated to bingo rentals.

SECTION 27. Sections 2001.159(a) and (b), Occupations Code,

are amended to read as follows:

(a) The
department
[
commission
] shall issue or renew a

commercial lessor license if the
department
[
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 rent to be charged is fair and reasonable;

(4) there is no diversion of the funds of the proposed

lessee from the lawful purposes under this chapter;

(5) 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

(6) the applicant will lease the premises for the

conduct of bingo in accordance with this chapter.

(b) The
department
[
commission
] shall issue a commercial

lessor license under this section for the period specified in the

license application or for a shorter period as the commission

determines.

SECTION 28. Sections 2001.160(a), (e), (f), and (g),

Occupations Code, are amended to read as follows:

(a) On approval by the
department
[
commission
], a licensed

commercial lessor may transfer a commercial lessor license if the

person to whom the license will be transferred otherwise meets the

requirements of this subchapter.

(e) Unless the
department
[
commission
] revokes or suspends

the license under this chapter, or an injunction is issued under

this section, a licensed authorized organization that conducts

bingo lawfully at premises under a license to which Subsection (d)

applies may continue conducting bingo at the premises after the

death or incapacity of the commercial lessor license holder.

(f) On the showing by the
department
[
commission
] of a cause

that would be sufficient for the commission
or the department
to

revoke or suspend a license under this chapter or an applicable

commission rule, a district court in the county for which a

commercial lessor license was issued or the
department
[
commission
]

by order may temporarily or permanently enjoin the conduct of bingo

at premises under a license to which Subsection (d) applies.

(g) The estate or guardian of an individual to whom

Subsection (d) applies shall notify the
department
[
commission
] not

later than one year after the date the individual dies or is

determined to be incapacitated by a court of this state. The estate

or guardian and the heirs or other appropriate person shall

promptly take all necessary steps to complete a transfer of the

license to the heirs or other appropriate person.

SECTION 29. Section 2001.161(c), Occupations Code, is

amended to read as follows:

(c) The
department
[
commission
] may issue a commercial

lessor license to a licensed authorized organization only for the

same premises where the organization is licensed to conduct bingo.

SECTION 30. 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

department
[
commission
] an application on a form prescribed by the

department
[
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) 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 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

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 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 criminal fraud or a gambling or

gambling-related offense;

(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
department

[
commission
] requests.

SECTION 31. Section 2001.204(a), Occupations Code, is

amended to read as follows:

(a) An applicant for a manufacturer's license must give the

department
[
commission
] a cash bond or a bond in the amount of

$10,000 issued by a surety company chartered or authorized to do

business in this state.

SECTION 32. Section 2001.208, Occupations Code, is amended

to read as follows:

Sec. 2001.208. DISTRIBUTOR'S LICENSE APPLICATION. (a) An

applicant for a distributor's license must file with the
department

[
commission
] an [
executed verified
] application on a form

prescribed by the
department
[
commission
].

(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 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 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 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 criminal fraud or a gambling or

gambling-related offense;

(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
department

[
commission
] requests.

SECTION 33. Sections 2001.211(a), (b), and (c), Occupations

Code, are amended to read as follows:

(a) An applicant for a manufacturer's or distributor's

license shall, during pendency of the application, notify the

department
[
commission
] immediately of any change relating to a

fact stated in the application.

(b) If a change occurs after issuance of a manufacturer's or

distributor's license, the license holder shall report the change

to the
department
[
commission
] not later than the 14th day after the

date of the change.

(c) Not later than the 14th day after the date of the change,

a license holder shall notify the
department
[
commission
] of a

change in:

(1) the license holder's organization, structure, or

mode of operation;

(2) the identity of persons named or required to be

named in the application and the nature or extent of those persons'

interest; or

(3) any other facts stated in the application.

SECTION 34. Section 2001.212, Occupations Code, is amended

to read as follows:

Sec. 2001.212. DENIAL OF LICENSE. The commission
or the

department
may deny an application for or renewal of a license for a

cause that would permit or require the suspension or revocation of

the license.

SECTION 35. Section 2001.213, Occupations Code, is amended

to read as follows:

Sec. 2001.213.
DEPARTMENT
[
COMMISSION
] ACTION NOT

REQUIRED. If, for reasons beyond the control of the
department

[
commission
], sufficient information is not available to allow the

department
[
commission
] to determine the eligibility of an

applicant for a manufacturer's or distributor's license issued

under this chapter, the
department
[
commission
] is not required to

take action on the application until the applicant provides the

required information.

SECTION 36. Section 2001.214(a), Occupations Code, is

amended to read as follows:

(a) Except as provided by Subsection (b), a manufacturer's

or distributor's license is effective for one year unless revoked

or suspended by the commission
or the department
.

SECTION 37. Section 2001.216, Occupations Code, is amended

to read as follows:

Sec. 2001.216. EXAMINATION OF RECORDS. (a) The
department

[
commission
] may examine the books and records of the holder of or

an applicant for a manufacturer's or distributor's license.

(b) The
department
[
commission
] may not disclose

information obtained during the examination except as necessary to

carry out this chapter.

SECTION 38. Sections 2001.218(b) and (c), Occupations Code,

are amended to read as follows:

(b) If a payment is not made when due, the seller shall

immediately notify the
department
[
commission
]. The
department

[
commission
] shall notify all manufacturers and distributors

licensed in this state of the default.

(c) In the event of a default, a person may not sell or

transfer bingo equipment or supplies to the purchaser in default on

terms other than immediate payment on delivery until otherwise

authorized by the
department
[
commission
].

SECTION 39. The heading to Subchapter G, Chapter 2001,

Occupations Code, is amended to read as follows:

SUBCHAPTER G. GENERAL
LICENSING
PROVISIONS [
RELATING TO COMMISSION

LICENSES
]

SECTION 40. Section 2001.301, Occupations Code, is amended

to read as follows:

Sec. 2001.301. LICENSE
DETERMINATION
[
INVESTIGATION
].

Promptly after the filing of the application for a license under

this chapter, the
department
[
commission
] shall
review

[
investigate
] the qualifications of each applicant and
determine

whether the applicant meets the requirements for the license
[
the

merits of the application
].

SECTION 41. Section 2001.3025, Occupations Code, is amended

to read as follows:

Sec. 2001.3025. [
ACCESS TO
] CRIMINAL HISTORY RECORD

INFORMATION
REQUIREMENT
.
(a)
The
department shall require an

applicant for a license under this chapter to submit to the

department or to
[
commission is entitled to conduct an

investigation of and is entitled to obtain criminal history record

information maintained by
] the Department of Public Safety
a

complete and legible set of fingerprints on a form the department

prescribes for the purpose of obtaining criminal history record

information from the Department of Public Safety and
[
,
] the Federal

Bureau of Investigation [
identification division, or another law

enforcement agency to assist in the investigation of:

[
(1)

an applicant for or holder of a license issued

under this chapter;

[
(2)

a person required to be named in a license

application; or

[
(3)

an employee or other person who works or will work

for a license holder and who is required by another provision of

this chapter to undergo a criminal background check
].

(b)

The department may not issue a license to a person or

entity who does not comply with the requirement of Subsection (a).

(c)

The department shall conduct a criminal history record

information check of each applicant for a license using

information:

(1) provided by the individual under this section; and

(2)

made available to the department by the Department

of Public Safety, the Federal Bureau of Investigation, and any

other criminal justice agency under Chapter 411, Government Code.

(d) The department may:

(1)

enter into an agreement with the Department of

Public Safety to administer a criminal history record information

check required under this section; and

(2)

authorize the Department of Public Safety to

collect from each applicant the costs incurred by the Department of

Public Safety in conducting the criminal history record information

check.

(e)

For purposes of this section, if the applicant for a

license is an entity, the applicant must submit fingerprints as

required by Subsection (a) for each individual who:

(1)

personally or constructively holds, including as

the beneficiary of a trust:

(A)

at least 10 percent of the entity's

outstanding stock; or

(B)

more than $25,000 of the fair market value of

the entity;

(2) has the controlling interest in the entity;

(3)

has a direct or indirect participating interest

through shares, stock, or otherwise, regardless of whether voting

rights are included, of more than 10 percent of the profits,

proceeds, or capital gains of the entity;

(4)

is a member of the board of directors or other

governing body of the entity; or

(5) serves as:

(A) an elected officer of the entity; or

(B) a general manager of the entity.

(f)

This section does not apply to a temporary license

issued under this chapter.

SECTION 42. Sections 2001.305(a), (b), and (c), Occupations

Code, are amended to read as follows:

(a) The
department
[
commission
] may not issue a license to

an applicant for an authorized organization license or a commercial

lessor license until the applicant has sent a copy of the license

application to the appropriate governing body.

(b) Except as provided by Section 2001.103(i), immediately

after issuing a license, the
department
[
commission
] shall send a

copy of the license to the appropriate governing body. The

governing body shall file the copy of the license in a central file

containing licenses issued under this chapter.

(c) Except as provided by Section 2001.103(i), not later

than the 10th day after the date a license is issued, the
department

[
commission
] shall give written notice of the issuance of the

license to:

(1) the police department of the municipality in which

bingo will be conducted, if bingo is to be conducted in a

municipality; or

(2) the sheriff of the county in which bingo will be

conducted, if bingo is to be conducted outside a municipality.

SECTION 43. Sections 2001.306(a) and (d), Occupations Code,

are amended to read as follows:

(a) A license issued under this chapter may be amended on

application to the
department
[
commission
] and on payment of a fee

in the amount required by the commission if the subject matter of

the proposed amendment could properly have been included in the

original license.

(d) The holder of a license to conduct bingo shall notify

the
department
[
commission
] before changing the time or date of a

game. The license holder may provide notice to the
department

[
commission
] regarding the change by use of telephone or facsimile.

SECTION 44. Section 2001.311, Occupations Code, is amended

to read as follows:

Sec. 2001.311. RIGHTS NOT VESTED. The issuance of a license

[
or temporary authorization
] by the
department
[
commission
] does

not grant a vested right in the license[
, the temporary

authorization,
] or the privileges conferred.

SECTION 45. Sections 2001.313(a), (b-1), (c), (e), (f), and

(g), Occupations Code, are amended to read as follows:

(a) To minimize duplicate criminal history background

checks by the
department
[
commission
] and the costs incurred by

organizations and individuals, the
department
[
commission
] shall

maintain a registry of individuals on whom the
department

[
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-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

department
[
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.

(c) The
department
[
commission
] shall make the registry

information available to the public by publishing it on the

department's
[
commission's
] website [
and by responding to

telephone, e-mail, and facsimile requests
]. This subsection does

not require the
department
[
commission
] to disclose information

that is confidential by law.

(e) The
department
[
commission
] may refuse to add an

individual's name to, or remove an individual's name from, the

registry established by this section if, after notice and, if

requested by the individual, a hearing, the individual 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;

(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

department
[
commission or its designee
] the discovery of any

conduct on the part of an individual 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 name from, or refusal to add the individual's name

to, the registry established by this section. A statement made in

good faith to the
department
[
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 who has been finally determined to have

taken action prohibited by Subsection (e)(2), (3), (4), (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 is eligible for listing on the registry provided a

licensee subject to this chapter makes application to list the

individual. In such event, the
department
[
commission
] shall take

into consideration the facts and circumstances that occurred that

led to the applicable action under Subsections (e)(2)-(7) in

deciding whether to list the individual on the registry.

SECTION 46. Sections 2001.314(a) and (b), Occupations Code,

are amended to read as follows:

(a) The commission
by rule
may require an individual listed

in the registry maintained under Section 2001.313 to wear an

identification card to identify the individual to license holders,

bingo players, and
department
[
commission
] staff while the

individual is on duty during the conduct of bingo. The commission

by rule shall prescribe the form and content of the card.

(b) The
department
[
commission
] shall provide the

identification card and shall provide a form to be completed by an

individual that allows the individual to prepare the identification

card. The commission may
set
[
collect
] a reasonable
fee for the

individual to pay to the department
[
charge
] to cover the cost of

providing the card or form.

SECTION 47. Section 2001.316, Occupations Code, is amended

to read as follows:

Sec. 2001.316. DELIVERY OF
DEPARTMENT
[
COMMISSION
] NOTICE.

If notice under this chapter is required to be given to an

authorized organization, the
department
[
commission
] shall send

the notice to the bingo chairperson of the authorized organization

and to the appropriate commercial lessor, if applicable.

SECTION 48. Section 2001.351, Occupations Code, is amended

to read as follows:

Sec. 2001.351. DENIAL
, REVOCATION, AND SUSPENSION
OF

LICENSE. The commission
or the department
may deny
, revoke, or

suspend in accordance with Subchapter G, Chapter 51,
[
an

application for
] a license or renewal of a license issued under this

chapter for a
violation of
[
cause that would permit or require the

suspension or revocation of a license issued under
] this chapter
or

a rule or order of the commission or the department
.

SECTION 49. Sections 2001.355(a), (b), and (c), Occupations

Code, are amended to read as follows:

(a) The
department
[
commission
] may temporarily suspend a

license issued under this chapter for failure to comply with this

chapter or a commission rule.

(b) Before temporarily suspending a license, the
department

[
director of bingo operations
] must follow any prehearing rules

adopted by the commission to determine
whether
[
if
] the license

holder's continued operation may constitute:

(1) an immediate threat to the health, safety,

[
morals,
] or welfare of the public; or

(2) a financial loss to this state, which includes a

license holder's failure to remit prize fee payments under Section

2001.502 to the
department
[
commission
] as required by that

section.

(c)
An order of temporary suspension issued under this

section must comply with the procedural requirements for an

emergency order issued under Section 51.3511
[
Chapter 2001,

Government Code, does not apply to the director of bingo operations

or to the commission in the enforcement and administration of a

temporary suspension under this section
].

SECTION 50. Section 2001.403(b), Occupations Code, is

amended to read as follows:

(b) This section does not apply if more than one premises

lawfully exists under a common roof or over a common foundation

under a license application filed [
with the commission
] on or

before May 23, 1997. The
department
[
commission
] shall renew a

license at the premises that is otherwise in compliance with this

chapter.

SECTION 51. Section 2001.407(f), Occupations Code, is

amended to read as follows:

(f) With the prior written consent of the
department

[
commission
], a licensed authorized organization may make an

occasional sale of bingo cards or of a used bingo flash board or

blower to another licensed authorized organization.

SECTION 52. Section 2001.411(e), Occupations Code, is

amended to read as follows:

(e) The commission may not prohibit an operator responsible

for conducting, promoting, or administering bingo from acting as a

bingo caller for a licensed authorized organization during a bingo

occasion. This subsection does not relieve the operator of the duty

to be available to a
department
[
commission
] employee or bingo

player if required by this chapter.

SECTION 53. Section 2001.415, Occupations Code, is amended

to read as follows:

Sec. 2001.415. ADVERTISEMENTS. (a) A person other than a

licensed authorized organization, licensed commercial lessor, or

the
department
[
commission
] may not advertise bingo.

(b) A licensed authorized organization, licensed commercial

lessor, or the
department
[
commission
] may include in an

advertisement or promotion the amount of a prize or series of prizes

offered at a bingo occasion.

SECTION 54. Sections 2001.437(a) and (b), Occupations Code,

are amended to read as follows:

(a) If the unit accounting agreement of a unit states that a

unit manager is responsible for compliance with commission rules

and this chapter, the unit manager is responsible for:

(1) the filing of one quarterly report for the unit on

a form prescribed by the
department
[
commission
]; and

(2) the payment of fees and the maintenance of the

bingo inventory and financial records of the unit.

(b) A unit with a unit manager shall notify the
department

[
commission
] of the name of the unit manager and immediately notify

the
department
[
commission
] of any change of unit manager.

SECTION 55. Sections 2001.438(b) and (d), Occupations Code,

are amended to read as follows:

(b) The unit shall designate with the
department

[
commission
] an agent who will be responsible for providing the

department
[
commission
] access to all inventory and financial

records of the unit on request of the
department
[
commission
].

(d) The unit shall immediately notify the
department

[
commission
] of any change in the agent designated under Subsection

(b).

SECTION 56. Section 2001.439(c), Occupations Code, is

amended to read as follows:

(c) The commission may prohibit a person who serves as a

designated agent that is listed on a license under this chapter,

including having been approved by the
department
[
commission
] to

work in the bingo operations of a licensed authorized organization

or as an operator, from holding or being listed on any license or

from being approved to work in the bingo operations of any licensed

authorized organization or to serve as an operator if the person has

failed to comply with the duties required of the person as a unit

manager or designated agent.

SECTION 57. Sections 2001.451(c), (h), (i), (j), and (k),

Occupations Code, are amended to read as follows:

(c) A licensed authorized organization may transfer money

from its general fund or other account to the organization's bingo

account or to the bingo account of a unit of which the organization

is a member under Subchapter I-1, if applicable, if:

(1) the balance in the bingo account to which the funds

are transferred is less than the maximum amount permitted by this

section; and

(2) the organization notifies the
department

[
commission
] of the transfer not later than the 14th day after the

date of the transfer.

(h) Except as provided by Subsection (j), a licensed

authorized organization or a unit of licensed authorized

organizations may retain operating capital in the organization's or

unit's bingo account in an amount that:

(1) is equal to the organization's or unit's actual

average bingo expenses per quarter based on the preceding license

period, excluding prizes paid; and

(2) does not exceed a total of $50,000 for a single

organization or $50,000 for each member of a unit unless:

(A) the commission by rule establishes a higher

amount for all organizations or units or one or more classes of

organizations or units; or

(B) the
department
[
bingo operations director
],

on request, raises the operating capital limit for one organization

or unit as necessary to facilitate the operation of the

organization or unit.

(i) Prize fees are not included in the calculation of

operating capital under Subsection (h) if the prize fees are:

(1) held in escrow for remittance to:

(A) the
department
[
commission
]; or

(B) a county or municipality; or

(2) retained by a licensed authorized organization.

(j) The commission shall adopt rules allowing a licensed

authorized organization to retain a maximum amount of operating

capital in the bingo account in excess of the amount provided by

Subsection (h) if the organization:

(1) has conducted bingo for less than one year;

(2) experiences circumstances beyond the control of

the organization, including force majeure, that necessitate an

increase in operating capital; or

(3) provides to the
department
[
commission
] a credible

business plan for the conduct of bingo or for the organization's

existing or planned charitable purposes that an increase in

operating capital will reasonably further.

(k) A licensed authorized organization may apply to the

department
[
commission
] for a waiver of the requirements of this

section and Section 2001.457. The
department
[
commission
] may

grant the waiver on a showing of good cause by the organization that

compliance with this section and Section 2001.457 is detrimental to

the organization's existing or planned charitable purposes. An

organization applying for a waiver establishes good cause by

providing to the
department
[
commission
]:

(1) credible evidence of circumstances beyond the

control of the organization, including force majeure; or

(2) a credible business plan for the organization's

conduct of bingo or the organization's existing or planned

charitable purposes.

SECTION 58. Section 2001.457(b), Occupations Code, is

amended to read as follows:

(b) If a licensed authorized organization fails to meet the

requirements of Subsection (a) for a quarter, the
department

[
commission
] in applying appropriate sanctions shall consider

whether, taking into account the amount required to be disbursed

during that quarter and the three preceding quarters, the

organization has disbursed a total amount sufficient to have met

the disbursement requirement for that quarter and the three

preceding quarters combined.

SECTION 59. Sections 2001.502(a) and (b), Occupations Code,

are amended to read as follows:

(a) A licensed authorized organization or unit as defined by

Section 2001.431 shall:

(1) collect from a person who wins a cash bingo prize

of more than $5 a fee in the amount of five percent of the amount of

the prize; and

(2) except as otherwise provided by this section,

remit to the
department
[
commission
] the amount of the fee

collected under Subdivision (1).

(b) Notwithstanding Subsection (a)(2), each quarter, a

licensed authorized organization or unit that collects a prize fee

under Subsection (a) for a bingo game conducted in a county or

municipality that was entitled to receive a portion of a bingo prize

fee as of January 1, 2019, shall remit 50 percent of the amount

collected as the prize fee to the
department
[
commission
] and shall

remit or deposit the remainder of the amount collected as the prize

fee as follows:

(1) if the county in which the bingo game is conducted

voted before November 1, 2019, to impose the prize fee and the

location at which the bingo game is conducted:

(A) is not within the boundaries of a

municipality, remit 50 percent of the amount collected as the prize

fee to the county; or

(B) is within the boundaries of a municipality

that:

(i) voted before November 1, 2019, to

impose the prize fee, remit 50 percent of the amount collected as

the prize fee in equal shares to the county and municipality; or

(ii) did not vote before November 1, 2019,

to impose the prize fee, remit 25 percent of the amount collected as

the prize fee to the county and deposit the remaining amount in the

manner described by Subdivision (3);

(2) if the county in which the bingo game is conducted

did not vote before November 1, 2019, to impose the prize fee and

the location at which the bingo game is conducted is within the

boundaries of a municipality that voted before November 1, 2019, to

impose the prize fee:

(A) remit 25 percent of the amount collected as

the prize fee to the municipality; and

(B) deposit the remaining amount in the manner

described by Subdivision (3); and

(3) if neither the county or municipality in which the

bingo game is conducted voted before November 1, 2019, to impose the

prize fee, deposit the remainder of the amount collected as the

prize fee in the general charitable fund of the organization or on a

pro rata basis to the general funds of the organizations comprising

the unit, as applicable, to be used for the charitable purposes of

the organization or organizations.

SECTION 60. Sections 2001.504(a), (b), and (d), Occupations

Code, are amended to read as follows:

(a) A fee on prizes authorized or imposed under this

subchapter is due and is payable by the license holder or a person

conducting bingo without a license to the
department
[
commission
]

and county or municipality, as applicable, quarterly on or before

the 25th day of the month succeeding each calendar quarter.

(b) The report of the fee on prizes must be filed [
under

oath
] on forms prescribed by the
department
[
commission
].

(d) A license holder required to file a report of the fee on

prizes shall deliver the quarterly report with the net amount of the

fee due to the
department
[
commission
].

SECTION 61. Section 2001.505(a), Occupations Code, is

amended to read as follows:

(a) A licensed authorized organization conducting bingo

shall submit quarterly to the
department
[
commission
] a report

under oath stating:

(1) the amount of the gross receipts derived from

bingo;

(2) each item of expense incurred or paid;

(3) each item of expenditure made or to be made, the

name and address of each person to whom each item has been paid or is

to be paid, and a detailed description of the merchandise purchased

or the services rendered;

(4) the net proceeds derived from bingo;

(5) the use to which the proceeds have been or are to

be applied; and

(6) a list of prizes offered and given, with their

respective values.

SECTION 62. Section 2001.507, Occupations Code, is amended

to read as follows:

Sec. 2001.507. COLLECTION AND DEPOSIT OF PRIZE FEE. (a)

The
department
[
commission
] shall deposit the revenue collected

from the fee on prizes imposed by Section 2001.502 to the credit of

the general revenue fund.

(a-1) The revenue collected by the
department
[
commission
]

from the fee on prizes imposed by Section 2001.502 is considered

miscellaneous revenue for purposes of appropriations made to the

department
[
commission
] under the General Appropriations Act for

the administration of this chapter.

SECTION 63. Section 2001.508(a), Occupations Code, is

amended to read as follows:

(a) If a person fails to file a report of the fee on prizes

as required by this chapter or fails to pay to the
department

[
commission
] the fee on prizes imposed under this chapter when the

report or payment is due, the person forfeits five percent of the

amount due as a penalty, and after the first 30 days, the person

forfeits an additional five percent.

SECTION 64. Section 2001.509, Occupations Code, is amended

to read as follows:

Sec. 2001.509. RECOMPUTATION OF PRIZE FEE. If the

department
[
commission
] is not satisfied with a report of the fee on

prizes or the amount of the fee on prizes required to be remitted

under this chapter to the state by a person, the
department

[
commission
] may compute and determine the amount required to be

paid on the basis of:

(1) the facts contained in the report of the fee on

prizes or report of receipts and expenses; or

(2) any information possessed by the
department

[
commission
] or that may come into the possession of the
department

[
commission
], without regard to the period covered by the

information.

SECTION 65. Sections 2001.510(a), (b), and (c), Occupations

Code, are amended to read as follows:

(a) If a license holder fails to make a required report of

the fee on prizes, or if a person conducts bingo without a license,

the
department
[
commission
] shall make an estimate of the prizes

awarded at a bingo occasion. The
department
[
commission
] shall

make the estimate for the period in respect to which the license

holder or other person failed to make a report.

(b) The estimate shall be based on any information covering

any period possessed by the
department
[
commission
] or that may

come into the possession of the
department
[
commission
].

(c) On the basis of the
department's
[
commission's
]

estimate, the
department
[
commission
] shall compute and determine

the amount of the fee on prizes required to be paid to the state and

shall add to that amount a penalty of 10 percent of the amount.

SECTION 66. Sections 2001.511(a) and (b), Occupations Code,

are amended to read as follows:

(a) If the
department
[
commission
] believes that the

collection of the fee on prizes, an amount of the fee on prizes

required to be remitted to the state, or the amount of a

determination will be jeopardized by delay, the
department

[
commission
] shall make a determination of the fee on prizes or

amount of the fee required to be collected, noting the finding of

jeopardy on the determination. The determined amount is due and

payable immediately.

(b) If a license holder against whom the determination is

made does not pay the amount specified by a determination on or

before the 20th day after the date of service of the determination

on the license holder, the amount becomes final at the end of the

20th day unless the license holder files
with the department
a

petition for redetermination on or before the 20th day after

service of notice of the determination.

SECTION 67. Section 2001.512(b), Occupations Code, is

amended to read as follows:

(b) In applying the provisions of Subtitle B, Title 2, Tax

Code, to the fee on prizes imposed under Section 2001.502 only, the

fee on prizes is treated as if it were a tax and the powers and

duties assigned to the comptroller under that subtitle are assigned

to the
department
[
commission
].

SECTION 68. Sections 2001.513(a), (b), (c), (d), (f), (g),

and (h), Occupations Code, are amended to read as follows:

(a) At any time within three years after a person is

delinquent in the payment of an amount of the fee on prizes due to

the
department
[
commission
], the
department
[
commission
] may

collect the amount under this section.

(b) The
department
[
commission
] shall seize real or

personal property of the license holder not exempt from execution

under the laws of this state and sell the property, or a sufficient

part of the property, at public auction to pay the amount due and

interest or penalties caused by the seizure and sale.

(c) The
department
[
commission
] shall give the delinquent

person written notice of the sale, including the time and place of

the sale, at least 20 days before the date set for the sale. The

department
[
commission
] shall mail the notice, postage prepaid, in

an envelope addressed to the person at the person's last known

address or place of business.

(d) The
department
[
commission
] shall publish the notice

for at least 10 days before the date set for the sale in a newspaper

of general circulation published in the county in which the

property seized is to be sold. If there is no newspaper of general

circulation in the county, the
department
[
commission
] shall post

the notice in three public places in the county at least 20 days

before the date set for the sale.

(f) At the sale, the
department
[
commission
] shall sell the

property in accordance with law and the notice and shall deliver to

the purchaser a bill of sale for personal property and a deed for

real property sold. The bill of sale or deed vests the interest or

title of the delinquent person for the amount in the purchaser. The

unsold portion of property seized may be left at the place of sale

at the risk of the delinquent person for the amount.

(g) Except as provided by Subsection (h), if the money

received at the sale exceeds the total amounts, including interest,

penalties, and costs due to the state, the
department
[
commission
]

shall return the excess money to the person liable for the amounts

and shall obtain the person's receipt. If the receipt of the

delinquent person for the amount is not available, the
department

[
commission
] shall deposit the excess money with the comptroller,

as trustee for the person, subject to the order of the person, or

the person's heirs, successors, or assigns.

(h) If a person having an interest in or lien on the property

files with the
department
[
commission
] before the sale notice of

the person's interest or lien, the
department
[
commission
] shall

withhold any excess money pending a court determination of the

rights of the respective parties to the money.

SECTION 69. Sections 2001.514(a), (c), and (d), Occupations

Code, are amended to read as follows:

(a) To secure payment due to the
department
[
commission
] of

the fee on prizes imposed under this subchapter, each license

holder shall furnish to the
department
[
commission
]:

(1) a cash bond;

(2) a bond from a surety company chartered or

authorized to do business in this state;

(3) certificates of deposit;

(4) certificates of savings;

(5) United States treasury bonds;

(6) subject to the approval of the
department

[
commission
], an assignment of negotiable stocks or bonds; or

(7) other security as the commission
by rule
considers

sufficient.

(c) On a license holder's failure to pay the fee on prizes

imposed under this subchapter, the
department
[
commission
] may

notify the license holder and any surety of the delinquency by

jeopardy or deficiency determination. If payment is not made when

due, the
department
[
commission
] may forfeit all or part of the bond

or security.

(d) If the license holder ceases to conduct bingo and

relinquishes the license holder's license, the
department

[
commission
] shall authorize the release of all bonds and other

security on a determination that no amounts of the fee on prizes

remain due and payable under this subchapter.

SECTION 70. Section 2001.515, Occupations Code, is amended

to read as follows:

Sec. 2001.515.
DEPARTMENT'S
[
COMMISSION'S
] DUTIES. The

department
[
commission
] shall perform all functions incident to the

administration, collection, enforcement, and operation of the fee

on prizes imposed under this subchapter for amounts due to the

department
[
commission
], including any necessary reconciliation of

a prize fee held by the
department
[
commission
] that is due to a

county or municipality.

SECTION 71. Section 2001.551(f), Occupations Code, is

amended to read as follows:

(f) A game exempted under Subsection (b)(4) is subject to

the following restrictions:

(1) a person licensed or required to be licensed under

this chapter or having an interest in a license under this chapter

may not be involved, directly or indirectly, in bingo, except that a

licensed manufacturer or licensed distributor may sell or otherwise

furnish bingo equipment or supplies for use in a game;

(2) a person conducting bingo may purchase or

otherwise obtain bingo equipment or supplies through a newspaper, a

radio or television station, or an advertising agency and, unless

otherwise authorized by [
the
] commission
rule
, only from a licensed

manufacturer or licensed distributor;

(3) a licensed manufacturer or licensed distributor

may sell or otherwise furnish bingo equipment or supplies for use in

a game only to or through a newspaper or a radio or television

station or through an advertising agency acting on behalf of a

person authorized to conduct the game; and

(4) the commission by rule may require a person

conducting or involved in conducting the game to:

(A) notify the
department
[
commission
] of:

(i) the persons involved in conducting the

game;

(ii) the manner in which the game is to be

conducted; and

(iii) any other information required by the

commission; and

(B) keep records of all transactions connected

with the game available for
department
[
commission
] inspection.

SECTION 72. Section 2001.557, Occupations Code, is amended

to read as follows:

Sec. 2001.557. INSPECTION OF PREMISES. (a) The
department

[
commission, its officers or agents,
] or a state, municipal, or

county peace officer may enter and inspect the contents of premises

where:

(1) bingo is being conducted or intended to be

conducted; or

(2) equipment used or intended for use in bingo is

found.

(b) The
department
[
commission by rule
] shall
conduct

risk-based inspections in accordance with Section 51.211 that

[
develop and implement policies and procedures to:

[
(1)
] prioritize the inspection of premises where

bingo is being conducted or is intended to be conducted in

accordance with the risk factors
identified by the department
[
the

commission considers important
], including:

(1)
[
(A)
] the amount of money derived from the conduct

of bingo at the premises;

(2)
[
(B)
] the compliance history of the premises; and

(3)
[
(C)
] the amount of time that has elapsed since

the date of the immediately preceding commission inspection of the

premises[
; and

[
(2)

inspect premises where bingo is being conducted

or is intended to be conducted in accordance with the priorities

established under Subdivision (1)
].

SECTION 73. Section 2001.558(a), Occupations Code, is

amended to read as follows:

(a) If the
department
[
commission
], the appropriate

governing body, or the attorney general has reason to believe that

this chapter has been or is about to be violated, the
department

[
commission
], the governing body, or the attorney general may

petition a court for injunctive relief to restrain the violation.

SECTION 74. Sections 2001.560(c), (c-1), (c-2), and (e),

Occupations Code, are amended to read as follows:

(c) The
department
[
commission
] or a person authorized in

writing by the
department
[
commission
] may examine the books,

papers, records, equipment, and place of business of a license

holder and may investigate the character of the license holder's

business to verify the accuracy of a return, statement, or report

made, or, if no return is made by the license holder, to ascertain

and determine the amount required to be paid.

(c-1) The commission by rule shall develop a policy for

auditing license holders. The
department
[
bingo division
] shall

use audit risk analysis procedures established by the commission

to:

(1) annually identify which license holders are most

at risk of violating this chapter or rules adopted under this

chapter; and

(2) develop a plan for auditing the identified license

holders that includes:

(A) a schedule for the audits of the identified

license holders;

(B) procedures to annually update the plan based

on successive risk analyses; and

(C) a completion date for each audit that is not

later than the fifth anniversary of the date the license holder was

identified as a candidate for audit.

(c-2) The
department
[
bingo division
] shall provide to the

commission a copy of the auditing plan developed under Subsection

(c-1).

(e) If the
department issues a notice of alleged violation

in accordance with Section 51.303 for a violation of
[
commission

determines that a person is not complying with
] this chapter, the

department
[
commission
] shall notify the attorney general and the

governing body of the appropriate political subdivision.

SECTION 75. Section 2001.601, Occupations Code, is amended

to read as follows:

Sec. 2001.601. IMPOSITION OF PENALTY. The commission
or

the department
may impose an administrative penalty
in accordance

with Subchapter F, Chapter 51,
against a person who violates this

chapter or a rule
adopted
or order
issued
[
adopted
] by the

commission
or the department
under this chapter.

SECTION 76. Section 2001.602, Occupations Code, is amended

to read as follows:

Sec. 2001.602. AMOUNT OF PENALTY. [
(a)
] The amount of the

administrative penalty may not exceed $1,000 for each violation.

Each day a violation continues or occurs may be considered a

separate violation for purposes of imposing a penalty.

[
(b)

In determining the amount of the penalty, the director

shall consider:

[
(1)

the seriousness of the violation, including the

nature, circumstances, extent, and gravity of the prohibited acts;

[
(2) the history of previous violations;

[
(3) the amount necessary to deter future violations;

[
(4) efforts to correct the violation; and

[
(5) any other matter that justice may require.
]

SECTION 77. Section 2001.654(a), Occupations Code, is

amended to read as follows:

(a) If the officer responsible for certifying a petition

determines that a petition is valid, the governing body shall:

(1) order that an election be held in the appropriate

political subdivision on a date not later than the 60th day after

the date of the officer's certification; and

(2) notify the
department
[
commission
] by certified

mail, return receipt requested, that an election has been ordered.

SECTION 78. Section 2001.656(d), Occupations Code, is

amended to read as follows:

(d) The governing body of a political subdivision in which a

bingo election has been held shall not later than the 14th day after

the date of the election give written notification to the

department
[
commission
] of the results of the election. If as a

result of the election bingo is legalized in the political

subdivision, the governing body shall furnish the
department

[
commission
] with a map prepared by the governing body indicating

the boundaries of the political subdivision in which bingo may be

conducted.

SECTION 79. The following provisions of the Government Code

are repealed:

(1) Section 411.108(a-1);

(2) Section 467.021(c);

(3) Section 467.031; and

(4) Section 467.033.

SECTION 80. The following provisions of the Occupations

Code are repealed:

(1) Section 2001.052;

(2) Section 2001.053;

(3) Section 2001.0541;

(4) Sections 2001.056(c) and (d);

(5) Section 2001.058;

(6) Section 2001.059;

(7) Section 2001.061;

(8) Section 2001.158(e);

(9) Section 2001.205(c);

(10) Section 2001.209(c);

(11) Section 2001.302;

(12) Section 2001.304;

(13) Section 2001.306(f);

(14) Section 2001.308;

(15) Section 2001.315;

(16) Section 2001.352;

(17) Section 2001.353;

(18) Section 2001.354;

(19) Section 2001.356;

(20) Section 2001.357;

(21) Section 2001.358;

(22) Section 2001.559;

(23) Section 2001.603;

(24) Section 2001.604;

(25) Section 2001.605;

(26) Section 2001.606;

(27) Section 2001.607;

(28) Section 2001.608;

(29) Section 2001.609;

(30) Section 2001.610; and

(31) Section 2001.611.

SECTION 81. (a) On September 1, 2026:

(1) all functions and activities performed by the

Texas Lottery Commission relating to the regulation of bingo

operations under Chapter 2001, Occupations Code, immediately

before that date are transferred to the Texas Department of

Licensing and Regulation;

(2) a rule, policy, procedure, decision, or form

adopted by the Texas Lottery Commission relating to Chapter 2001,

Occupations Code, is a rule, policy, procedure, decision, or form

of the Texas Commission of Licensing and Regulation or the Texas

Department of Licensing and Regulation, as applicable, and remains

in effect until amended or replaced by that commission or

department unless the rule, policy, procedure, decision, or form

conflicts with the changes in law made by this Act;

(3) unless the context clearly indicates otherwise, a

reference to the Texas Lottery Commission in a law or

administrative rule that relates to Chapter 2001, Occupations Code,

means the Texas Commission of Licensing and Regulation or the Texas

Department of Licensing and Regulation, as applicable;

(4) a complaint, investigation, or other proceeding

before the Texas Lottery Commission that is related to Chapter

2001, Occupations Code, is transferred without change in status to

the Texas Department of Licensing and Regulation, and the Texas

Department of Licensing and Regulation assumes, as appropriate and

without a change in status, the position of the Texas Lottery

Commission in an action or proceeding to which the Texas Lottery

Commission is a party;

(5) a license, permit, certification, or registration

in effect that was issued by the Texas Lottery Commission under

Chapter 2001, Occupations Code, is continued in effect as a

license, permit, certification, or registration of the Texas

Department of Licensing and Regulation;

(6) all money, contracts, leases, property, and

obligations of the Texas Lottery Commission relating to Chapter

2001, Occupations Code, are transferred to the Texas Department of

Licensing and Regulation; and

(7) the unexpended and unobligated balance of any

money appropriated by the legislature for the Texas Lottery

Commission related to Chapter 2001, Occupations Code, is

transferred to the Texas Department of Licensing and Regulation.

(b) On September 1, 2026, all full-time equivalent employee

positions at the Texas Lottery Commission that primarily concern

the administration, auditing, accounting, enforcement, or other

direct and indirect support of Chapter 2001, Occupations Code,

become positions at the Texas Department of Licensing and

Regulation. When filling the positions, the Texas Department of

Licensing and Regulation shall give first consideration to an

applicant who, as of August 31, 2025, was an employee at the Texas

Lottery Commission primarily involved in administering or

enforcing Chapter 2001, Occupations Code.

(c) Not later than June 1, 2026, the Texas Lottery

Commission shall grant the Texas Department of Licensing and

Regulation inquiry-only security access to:

(1) all licensing, enforcement, and examination

software or computer systems used by the Texas Lottery Commission

in administering or enforcing Chapter 2001, Occupations Code; and

(2) the uniform statewide accounting system, the state

property accounting system, the uniform statewide payroll system,

and the human resources information system for the Texas Lottery

Commission.

(d) Before September 1, 2026, the Texas Lottery Commission

may agree with the Texas Department of Licensing and Regulation to

transfer any property of the Texas Lottery Commission to the Texas

Department of Licensing and Regulation to implement the transfers

required by this Act.

(e) The Texas Department of Licensing and Regulation and the

Texas Lottery Commission shall coordinate implementation of this

section. The Texas Lottery Commission shall cooperate with the

Texas Department of Licensing and Regulation in transferring all

data and records necessary to implement the transfers required by

this Act.

(f) Before July 15, 2026, the Texas Lottery Commission and

the Texas Department of Licensing and Regulation shall develop and

enter into a memorandum of understanding regarding the transfers

required by this Act. The memorandum must include a transition plan

with a timetable and specific steps and deadlines required to

complete the transfer.

(g) Not later than December 1, 2026, a manufacturer of bingo

equipment or supplies that submitted to the Texas Lottery

Commission a bond as required under Section 2001.204, Occupations

Code, before September 1, 2026, that is in effect on the effective

date of this Act must amend the bond to name the Texas Department of

Licensing and Regulation as the payee for the bond.

SECTION 82. Not later than December 1, 2028, the Sunset

Advisory Commission shall submit to the governor, the lieutenant

governor, the speaker of the house of representatives, and each

standing committee of the legislature with primary jurisdiction

over the regulation of charitable bingo in this state a report on

the transfer under this Act of the regulation of charitable bingo

from the Texas Lottery Commission to the Texas Commission of

Licensing and Regulation.

SECTION 83. The changes in law made by this Act to Chapter

2001, Occupations Code, apply only to a tax or fee charged or

penalty imposed on or after September 1, 2026. A tax or fee charged

or penalty imposed before September 1, 2026, is governed by the law

in effect immediately before that date, and the former law is

continued in effect for that purpose.

SECTION 84. Not later than March 1, 2027, the Texas

Commission of Licensing and Regulation shall adopt the rules

necessary to implement the changes in law made by this Act.

SECTION 85. (a) Except as provided by Subsection (b) of

this section, 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, 2025.

(b) Sections 1 through 80 of this Act take effect September

1, 2026.