TITLE 16. ECONOMIC REGULATION

PART 1. RAILROAD COMMISSION OF TEXAS

CHAPTER 12. COAL MINING REGULATIONS

SUBCHAPTER G. SURFACE COAL MINING AND RECLAMATION OPERATIONS, PERMITS, AND COAL EXPLORATION PROCEDURES SYSTEMS

DIVISION 2. GENERAL REQUIREMENTS FOR PERMITS AND PERMIT APPLICATIONS

16 TAC §12.108

The Railroad Commission of Texas (Commission) adopts amendments to §12.108, relating to Permit Fees, without changes to the proposed text as published in the October 6, 2017, issue of the Texas Register (42 TexReg 5303). The adopted amendments implement provisions of Senate Bill 1, 85th Texas Legislature (Regular Session, 2017), and, specifically, Article VI, Railroad Commission Rider 5, which requires the amounts appropriated from general revenue for state fiscal years 2018 and 2019 to cover the cost of permitting and inspecting coal mining operations. This requirement is contingent upon the Commission assessing fees sufficient to generate, during the 2018-2019 biennium, revenue to cover the general revenue appropriations.

The Commission amends the fees set forth in subsection (b) by amending the calendar years to 2017 and 2018. The Commission amends paragraph (1) to decrease the annual fee for each acre of land within a permit area covered by a reclamation bond on December 31st of each year, as shown on the map required at §12.142(2)(C) of this chapter (relating to Operation Plan: Maps and Plans), from the current $13.05 to $12.85. The Commission amends paragraph (2) to decrease the annual fee for each permit in effect on December 31st of a year to $6,170 from the current amount of $6,600. The Commission anticipates that annual fees in these new amounts will result in revenue of $2,556,180 in each year of the 2018-2019 biennium.

The Commission received no comments on the proposed amendments.

The Commission adopts the amendments under Texas Natural Resources Code, §134.013, which authorizes the Commission to promulgate rules pertaining to surface coal mining operations and §134.055, which authorizes the Commission to collect annual fees.

Statutory authority: Texas Natural Resources Code, §134.013 and §134.055.

Cross-reference to statute: Texas Natural Resources Code, §134.013 and §134.055.

Issued in Austin, Texas, on December 5, 2017.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on December 5, 2017.

TRD-201704968

Haley Cochran

Rules Attorney, Office of General Counsel

Railroad Commission of Texas

Effective date: December 25, 2017

Proposal publication date: October 6, 2017

For further information, please call: (512) 475-1295


PART 9. TEXAS LOTTERY COMMISSION

CHAPTER 401. ADMINISTRATION OF STATE LOTTERY ACT

The Texas Lottery Commission (Commission) adopts amendments to 16 TAC §§401.158 (Suspension or Revocation of License), 401.160 (Standard Penalty Chart), 401.302 (Scratch Ticket Game Rules), 401.304 (Draw Game Rules (General)), 401.307 ("Pick 3" Draw Game Rule), 401.308 ("Cash Five" Draw Game Rule), 401.312 ("Texas Two Step" Draw Game Rule), 401.320 ("All or Nothing" Draw Game Rule), 401.322 ("Texas Triple Chance" Draw Game Rule), 401.353 (Retailer Settlements, Financial Obligations, and Commissions), 401.361 (Required Purchases of Lottery Tickets), 401.364 (Training), and 401.370 (Retailer's Financial Responsibility for Lottery Tickets Received and Subsequently Stolen or Lost), without changes to the proposed text as published in the October 20, 2017, issue of the Texas Register (42 TexReg 5759) and will not be republished. The amendments to §401.301 (General Definitions),and §401.316 ("Daily 4" Draw Game Rule) are adopted with changes to the proposed text as published in the October 20, 2017, issue of the Texas Register (42 TexReg 5759). The adopted version of the rule adds a formal definition for third-party point-of-sale systems and corrects a typographical error in Figure 16 TAC §401.316(g)(16).

There are two purposes for the rule amendments. The first purpose is to facilitate the potential future sale of lottery tickets using Commission-approved third-party point-of-sale systems. Specifically, these amendments change the way tickets are issued, including revising the definition of terminals, clarifying language on Quick Pick selection, and updating how tickets are printed on third-party point-of-sale systems. Certain retailer requirements are amended to facilitate these types of sales as well.

Second, these amendments make conforming changes that match rule language to current Commission (and industry) practice and terminology. These amendments include changing the references to lottery games from "on-line" and "instant" to "draw" and "scratch." There are multiple other clarifications of meanings and terms, both to conform usage of those terms throughout the rules and to match current Commission practice. Some of these changes were identified in the most recent Commission rule review and are being implemented with these amendments.

The Commission received written comments on the proposed amendments during the public comment period from a representative of the Kickapoo Traditional Tribe of Texas.

COMMENT SUMMARY: None of the proposed amendments define the phrase "Commission-approved third-party point-of-sale systems." Nor do they define "third party point of sale system" or "point of sale system" or any other part of this phrase that would tell the reader what the term entails and what exact devices would be captured under it. Third-party point-of-sale systems must be defined so the public understands the implications of the regulations. Furthermore, the phrase "otherwise issued in a manner approved by the commission" (used in reference to tickets issued by "Commission-approved third-party point-of-sale systems") provides no specificity at all about how a ticket may be issued by a third-party point-of-sale system. The Commission should be precise and specifically set forth the manner in which a third-party point-of-sale system will issue a ticket under these proposed regulations and clarify exactly how that ticket will be used.

COMMISSION RESPONSE: As noted in the preamble to the rule proposal, one of the primary purposes of the proposed amendments is facilitate the potential future sale of lottery tickets on Commission-approved third-party point-of-sale systems. These sales would occur in-lane at traditional brick and mortar retail locations, such as grocery stores and chain retail stores, after those retailers obtained a Texas Lottery sales agent license. Third-party point-of-sale systems refers to the industry terminology used by these retailers to describe their self-contained equipment that performs sales-related tasks at the in-lane check-out counter, such as cash registers or self-checkout terminals, and will not include any gambling device.

The proposed amendments differentiate the third-party point-of-sale systems from the Texas Lottery dedicated lottery terminals currently used to sell draw game tickets. However, the third-party point-of-sale systems will only perform lottery-related tasks currently performed on Texas Lottery dedicated lottery terminals; in other words, the third-party systems will never do more than what a dedicated lottery terminal can do. The proposed amendments also differentiate the draw game ticket printing process used by the dedicated lottery terminals from the process that may be used on a third-party system. Each retailer may have its own proprietary point-of-sale system, so the Commission cannot define with specificity the exact hardware or software on which these draw game tickets may be sold or printed. The proposed amendments therefore provide that any third-party system and its method of issuing tickets must have Commission approval before being used to print and/or sell Texas Lottery draw game tickets to ensure compliance with the Commission's lottery security and integrity requirements.

To make the proposed amendments more clear on these points, the Commission will adopt the additional following definition in §401.301(50): Third-party point-of-sale systems-- Self-contained computerized equipment (not owned or operated by the commission or lottery operator) that performs sales-related tasks at a licensed lottery ticket retailer's checkout counter and that has the sole Texas Lottery-related purpose of selling draw game tickets printed on paper. Third-party point-of-sale systems will only perform the same lottery-related tasks as terminals owned or operated by the commission or lottery operator and may not issue electronic tickets or display outcomes for draw games using casino-style graphics of any kind. Third-party point-of-sale systems do not include any gambling device.

COMMENT SUMMARY: The proposed amendments include certain changes to the existing definition of "On Line Game." Instead of stating that "the random number generator operated by the computer" as in the existing regulations, the proposed definition of "Draw Game" states "the random number generator approved by the commission." This change should be explained. Further, the regulations should be specific.

COMMISSION RESPONSE: As noted above, the intent of the proposed amendments is to facilitate the potential future sale of lottery tickets at traditional brick and mortar retail locations. Currently, the random number generator used to select Quick Picks is part of the Texas Lottery dedicated lottery terminal. Once lottery tickets are sold on third-party point-of-sale systems, the Commission must retain control over the random number generator for lottery security and integrity purposes. The proposed amendments allow the Commission the flexibility to approve appropriate random number generator equipment on Commission-approved vendor systems or to require that retailers obtain random numbers for lottery ticket purchases from the Commission's lottery gaming system remotely. The Commission declines to make changes to the proposed amendments in response to this comment.

COMMENT SUMMARY: The proposed definition of "Draw game" adds "or other authorized entity" as an entity that will conduct a drawing. Who is the "other authorized entity"? When and how are they authorized for this purpose? This phrase should be more specific to identify who would fall into this category.

COMMISSION RESPONSE: As noted in the preamble to the rule proposal, the other primary purpose of the proposed amendments was to make conforming changes that match rule language to current Commission practice. There are certain instances in which the Commission does not conduct a drawing itself. For example, in multijurisdiction lottery draw games such as Powerball and Mega Millions, a lottery other than the Commission conducts the drawing. Also, in certain promotional or second-chance lottery drawings, a Commission vendor may conduct the drawing. In both situations, the party conducting the drawing is specifically authorized to conduct the drawing on behalf of the Commission. The rule language was updated to reflect this practice. The Commission declines to make changes to the proposed amendments in response to this comment.

SUBCHAPTER B. LICENSING OF SALES AGENTS

16 TAC §401.158, §401.160

These amendments are adopted under Texas Government Code §466.015, which authorizes the Commission to adopt rules governing the operation of the lottery; and §467.102, which authorizes the Commission to adopt rules for the enforcement and administration of the laws under the Commission's jurisdiction.

This adoption is intended to implement Texas Government Code, Chapter 466.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on December 11, 2017.

TRD-201705041

Bob Biard

General Counsel

Texas Lottery Commission

Effective date: December 31, 2017

Proposal publication date: October 20, 2017

For further information, please call: (512) 344-5012


SUBCHAPTER D. LOTTERY GAME RULES

16 TAC §§401.301, 401.302, 401.304, 401.307, 401.308, 401.312, 401.316, 401.320, 401.322

The following amendments are adopted under Texas Government Code §466.015, which authorizes the Commission to adopt rules governing the operation of the lottery; and §467.102, which authorizes the Commission to adopt rules for the enforcement and administration of the laws under the Commission's jurisdiction.

This adoption is intended to implement Texas Government Code, Chapter 466.

§401.301.General Definitions.

The following words and terms, when used in this chapter, shall have the following meanings, unless the context clearly indicates otherwise.

(1) Caption--The letters appearing below the play symbols in the play area of a ticket that verify the correctness of the play symbols.

(2) Certified drawing--A drawing in which a lottery drawing representative and an independent certified public accountant attest that the drawing equipment functioned properly and that a random selection of a winning combination occurred.

(3) Claim center--A claims office of the commission at which a claimant may claim a prize.

(4) Claim form--The printed form authorized and provided by the commission that a claimant shall complete and submit to the commission when claiming a prize.

(5) Claimant--A player who has submitted a valid claim for payment within the required time frame.

(6) Commission--The Texas Lottery Commission. Unless the context clearly requires otherwise, "commission" includes authorized Texas Lottery commission staff members/employees.

(7) Current draw period--The period of time in which the player selections and Quick Pick selections are accumulated into a pool of plays eligible for winning in a drawing held at the end of the designated period.

(8) Director--The Director of the Texas Lottery Commission, Lottery Operations.

(9) Direct prize category contribution--A specified percentage of net sales allocated to the prize categories as described in the rules of the specific game being played.

(10) Division--Lottery Operations of the Texas Lottery Commission.

(11) Draw break--A period of time before a drawing for a draw game during which player selections for that drawing may not be entered into the lottery gaming system and during which no requests for Quick Pick selections for that drawing may be entered into the lottery gaming system.

(12) Draw game--A lottery game which utilizes a computer system to administer plays, the type of game, and amount of play for a specified drawing date, and in which a player either selects a combination of numbers or allows number selection by a random number generator approved by the commission, referred to as Quick Pick. The commission, or other authorized entity, will conduct a drawing to determine the winning combination(s) in accordance with the rules of the specific game being played and the draw procedures for the specific game. Sometimes, draw games are called "on-line games."

(13) Draw game ticket--A ticket issued to a player, by a retailer, and generated by a terminal provided by the commission or commission's vendor on official Texas Lottery paper stock, or, for third-party point-of-sale systems approved by the commission, printed on paper stock or otherwise issued in a manner approved by the commission to provide tangible evidence of participation in a lottery game. That ticket shall be the only acceptable evidence of the combination of digits, numbers, or symbols selected. Draw game tickets may be purchased only from retailers.

(14) Drawing--The procedure by which the commission randomly selects winning combinations of digits, numbers, or symbols in accordance with the rules of the game as set forth in the rules of the specific game being played and the draw procedures for the specific game.

(15) Drawing pool--The amount of money available for all prize categories for a specific drawing.

(16) Draw procedures--The written document approved by the executive director that specifies the draw procedures for a particular game, if a drawing is designed as part of the game.

(17) Duplicate ticket--A ticket produced by photograph, xerography, or any other method other than a ticket generated by a terminal.

(18) Executive director--The executive director of the Texas Lottery Commission.

(19) Game number--The number on the back of the scratch ticket which refers to the number associated with the particular scratch ticket game.

(20) Game procedures--The written document approved by the director that includes, among other things, the game name, how a prize is won, game prize structure, play style, and eligibility for a drawing, if any.

(21) High-tier prize--A prize of $600 or more.

(22) Indirect prize category contribution--Amounts allocated from the prize reserve fund, roll-over and prize breakage for a specific draw game drawing.

(23) Invalid ticket--Any ticket that fails to meet all validation requirements of the commission.

(24) Lottery gaming system--The commission or commission's vendor's computer system consisting of terminals, central processing equipment, and a communication network.

(25) Lottery retailer or retailer--A licensed sales agent, as contemplated by Chapter 466, Government Code.

(26) Low-tier prize--A prize of less than $25.

(27) Mid-tier prize--A prize of $25 or more but less than $600.

(28) Minor--An individual younger than 18 years of age.

(29) Pack number--The unique number on the back of the scratch ticket that designates the number of the pack within a specific scratch ticket game.

(30) Play area--The latex-covered area of a scratch ticket that when removed, reveals the ticket play symbols.

(31) Play style--The method of play to determine a winner for an individual game.

(32) Play symbol--The printed data under the latex on a scratch ticket that is used to determine eligibility for a prize. The symbols for individual games will be specified in individual scratch ticket game procedures.

(33) Present at the terminal--A player remains physically present at the terminal from the time the player's order for the purchase of draw game tickets is paid for and accepted by the retailer until the processing of the order is completed and the tickets are delivered to the player at the retailer terminal location.

(34) Prize amounts--The amount of money payable to each share in a prize category, the annuitized future value of each share in a prize category, or the net present cash value of each share in a prize category for each draw game drawing. Prize amounts are calculated by dividing the prize category contribution, the annuitized future value of the prize category contribution, or the net present cash value of the prize category contribution by the number of shares determined for the prize category.

(35) Prize breakage--The money which is left over from the rounding down of the pari-mutuel prize levels to the next lowest whole dollar amount or money which is in excess of the amount needed to pay a prize.

(36) Prize category--The matching combinations of numbers and their corresponding prize levels as described in rules for the specific game being played.

(37) Prize category contributions--Refers to contributions for each drawing to each prize category, including direct and indirect prize category contributions.

(38) Prize fund--The monies allocated to be returned to players in winning tickets within a specific scratch ticket game.

(39) Prize pool--In a draw game, the total amount of money available for prizes as a percentage of the total sales for the current draw period.

(40) Prize structure--The number, value, prize pay out percentage, and odds of winning prizes for an individual game as approved by the executive director.

(41) Promotion--One or more events coordinated or conducted by the commission at retail sites, fairs, festivals and other appropriate venues, or in conjunction with one or more particular Texas Lottery games, to educate players about Texas Lottery products and/or sell Texas Lottery games through a retailer in specific markets to maximize Texas Lottery sales and statewide awareness.

(42) Promotional drawing--A drawing in which qualified contestants are awarded prizes in a random manner in accordance with the procedures set forth for a specific promotional event.

(43) Quick Pick--A play option that generates random numbers in a manner approved by the commission.

(44) Roll-over--The amount in a specific draw game prize pool category resulting from no matching combinations and/or prize breakage from the previous drawing.

(45) Sales agent--A person licensed under the State Lottery Act to sell Texas Lottery tickets.

(46) Scratch ticket--A scratch ticket lottery game, developed and offered for sale to the public in accordance with commission rules, that is played by removing the latex covered play area on a scratch ticket to reveal the ticket play symbols. Sometimes, scratch ticket games are called "instant games."

(47) Shares--In a draw game, the total number of matching combinations within each prize category as determined for each drawing.

(48) Sign-on slip--The receipt produced by a dedicated lottery ticket terminal when the retailer signs on to the lottery gaming system.

(49) Terminal--A device authorized by the commission for the purpose of issuing draw game tickets and/or validating claims, including the commission or commission's vendor's computer hardware as well as commission-authorized third-party point-of-sale systems.

(50) Third-party point-of-sale systems--Self-contained computerized equipment (not owned or operated by the commission or lottery operator) that performs sales-related tasks at a licensed lottery ticket retailer's checkout counter and that has the sole Texas Lottery-related purpose of selling draw game tickets printed on paper. Third-party point-of-sale systems will only perform the same lottery-related tasks as terminals owned or operated by the commission or lottery operator and may not issue electronic tickets or display outcomes for draw games using casino-style graphics of any kind. Third-party point-of-sale systems do not include any gambling device.

(51) Ticket--Any tangible evidence issued to provide participation in a lottery game or activity authorized by the State Lottery Act.

(52) Ticket bearer--The person who has signed the ticket or who has possession of an unsigned ticket.

(53) Ticket number--The number on the back of the scratch ticket that refers to the ticket sequence within a specific pack of a scratch ticket game.

(54) Validation number--The unique number sequence printed on a ticket that provides for the verification of the ticket as a valid winner.

(55) Valid ticket--A ticket which meets all specifications and validation requirements and entitles the holder to a specific prize amount.

(56) Void ticket--Any ticket that is stolen, unissued, illegible, mutilated, altered, counterfeit in whole or part, misregistered, defective, incomplete, printed or produced in error, multiply printed, fails any of the commission's confidential validation tests, or is a ticket produced by or for the commission for education and training purposes.

(57) Winning combination--One or more digits, numbers, or symbols randomly selected by the commission in a drawing which has been certified.

§401.316."Daily 4" Draw Game Rule.

(a) Daily 4. The executive director is authorized to conduct a game known as "Daily 4." The executive director may issue further directives and procedures for the conduct of Daily 4 that are consistent with this rule. In the case of conflict, this rule takes precedence over §401.304 of this title (relating to Draw Game Rules (General)).

(b) Definitions. In addition to the definitions provided in §401.301 of this title (relating to General Definitions), and unless the context in this rule otherwise requires, the following definitions apply.

(1) Play--A Daily 4 play other than a Sum It Up play consists of:

(A) the selection of a play type;

(B) the selection of a Daily 4 base play amount of $.50, $1, $2, $3, $4 or $5;

(C) the selection of a draw date and time;

(D) the selection of numbers in accordance with subsection (d) of this section; and

(E) the purchase of a ticket evidencing those selections.

(2) Sum It Up Play--A Sum It Up play consists of:

(A) the selection of the Sum It Up play type in connection with a straight play, a box play, a straight/box play, a combo play, a front-pair play, a mid-pair play, or a back-pair play;

(B) the selection of a Sum It Up base play amount of $.50, $1, $2, $3, $4 or $5; and

(C) the purchase of a ticket evidencing those selections.

(3) Playboard--A panel on a playslip containing four fields of numbers for use in selecting numbers for a Daily 4 play, with each field of numbers containing the numbers 0, 1, 2, 3, 4, 5, 6, 7, 8 and 9.

(4) Playslip--An optically readable card issued by the commission for use in making selections for one or more Daily 4 plays.

(c) Play types.

(1) Daily 4 may include the following play types: straight, box, straight/box, combo, front-pair, mid-pair, back-pair, and Sum It Up.

(A) A "straight" play is a winning play if the player's four single-digit numbers match in exact order the four single-digit numbers drawn in the applicable drawing.

(B) A "box" play is a winning play if the player's four single-digit numbers match in any order the four single-digit numbers drawn in the applicable drawing.

(i) A box play may be a 4-way box play, a 6-way box play, a 12-way box play, or a 24-way box play.

(I) A box play is a 4-way box play when box play is selected as the play type in connection with a set of four single-digit numbers that includes three occurrences of one single-digit number and one occurrence of one other single-digit number. A 4-way box play involves four possible winning combinations.

(II) A box play is a 6-way box play when box play is selected as the play type in connection with a set of four single-digit numbers that includes two occurrences of one single-digit number and two occurrences of another single-digit number. A 6-way box play involves six possible winning combinations.

(III) A box play is a 12-way box play when box play is selected as the play type in connection with a set of four single-digit numbers that includes two occurrences of one single-digit number and one occurrence of two other single-digit numbers. A 12-way box play involves 12 possible winning combinations.

(IV) A box play is a 24-way box play when box play is selected as the play type in connection with a set of four single-digit numbers that includes a single occurrence of four different single-digit numbers. A 24-way box play involves 24 possible winning combinations.

(ii) Box play is not permitted in connection with a set of numbers that includes four occurrences of one single-digit number.

(C) A "straight/box" play is a winning play either if the player's four single-digit numbers match in exact order the numbers drawn in the applicable drawing or if the player's four single-digit numbers match in any order the numbers drawn in the applicable drawing. The prize amount is greater if the player's four single-digit numbers match in exact order the numbers drawn in the applicable drawing.

(i) A straight/box play may be a 4-way straight/box play, a 6-way straight/box play, a 12-way straight/box play, or a 24-way straight/box play.

(I) A straight/box play is a 4-way straight/box play when straight/box play is selected in connection with a set of four single-digit numbers that includes three occurrences of one single-digit number and one occurrence of one other single-digit number. A 4-way straight/box play involves four possible winning combinations.

(II) A straight/box play is a 6-way straight/box play when straight/box play is selected in connection with a set of four single-digit numbers that includes two occurrences of one single-digit number and two occurrences of another single-digit number. A 6-way straight/box play involves six possible winning combinations.

(III) A straight/box play is a 12-way straight/box play when straight/box play is selected in connection with a set of four single-digit numbers that includes two occurrences of one single-digit number and one occurrence of two other single-digit numbers. A 12-way straight/box play involves 12 possible winning combinations.

(IV) A straight/box play is a 24-way straight/box play when straight/box play is selected in connection with a set of four single-digit numbers that includes a single occurrence of four different single-digit numbers. A 24-way straight/box play involves 24 possible winning combinations.

(ii) Straight/box play is not permitted in connection with a set of numbers that includes four occurrences of one single-digit number.

(D) A "combo" play combines into a single play all of the possible straight plays that can be played with the four single-digit numbers selected for the play.

(i) A combo play may be a 4-way combo play, a 6-way combo play, a 12-way combo play, or a 24-way combo play.

(I) 4-way combo play is a combo play in connection with a set of four single-digit numbers that includes three occurrences of one single-digit number and one occurrence of one other single-digit number. A four-way combo play involves four possible winning combinations.

(II) 6-way combo play is a combo play in connection with a set of four single-digit numbers that includes two occurrences of one single-digit number and two occurrences of another single-digit number. A six-way combo play involves six possible winning combinations.

(III) 12-way combo play is a combo play in connection with a set of four single-digit numbers that includes two occurrences of one single-digit number and one occurrence of two other single-digit numbers. A 12-way combo play involves 12 possible winning combinations.

(IV) 24-way combo play is a combo play in connection with a set of four single-digit numbers that includes a single occurrence of four different single-digit numbers. A 24-way combo play involves 24 possible winning combinations.

(ii) Combo play is not permitted in connection with a set of numbers that includes four occurrences of one single-digit number.

(E) Pair play.

(i) A "front-pair" play is a winning play if the player's two single-digit numbers match in exact order the first two single-digit numbers drawn in the applicable drawing.

(ii) A "mid-pair" play is a winning play if the player's two single-digit numbers match in exact order the second and third single-digit numbers drawn in the applicable drawing.

(iii) A "back-pair" play is a winning play if the player's two single-digit numbers match in exact order the last two single-digit numbers drawn in the applicable drawing.

(F) A Sum It Up play is a winning play if the sum of the player's two or four single-digit numbers, as applicable, is the same as the sum of the four single-digit numbers drawn in the applicable drawing. A Sum It Up play must occur in connection with a play of some other play type.

(2) The executive director may allow or disallow any type of play described in this subsection.

(d) Plays and tickets.

(1) A ticket may be sold only by a retailer and only at the location listed on the retailer's license. A ticket sold by a person other than a retailer is not valid.

(2) The selection of numbers for a straight play, a box play, a straight/box play, or a combo play involves the selection of four single-digit numbers, with each selected from the numbers 0, 1, 2, 3, 4, 5, 6, 7, 8, and 9.

(3) The selection of numbers for a front-pair play, a mid-pair play, or a back-pair play involves the selection of two single-digit numbers, with each selected from the numbers 0, 1, 2, 3, 4, 5, 6, 7, 8, and 9.

(4) The cost of a play varies according to the play type selected for the play and the base play amount selected for the play.

(A) The cost of a straight play is the same as the base play amount selected for the play.

(B) The cost of a box play is the same as the base play amount selected for the play.

(C) The cost of a straight/box play is:

(i) $1 if the base play amount selected for the play is $.50;

(ii) $2 if the base play amount selected for the play is $1;

(iii) $4 if the base play amount selected for the play is $2;

(iv) $6 if the base play amount selected for the play is $3;

(v) $8 if the base play amount selected for the play is $4; or

(vi) $10 if the base play amount selected for the play is $5.

(D) The cost of a combo play is determined by multiplying the base play amount selected for the play by the number of winning combinations possible with the four single-digit numbers selected for the play.

(E) The cost of a front-pair, mid-pair, or back-pair play is the same as the base play amount selected for the play.

(F) The cost of a Sum It Up play is the same as the Sum It Up base play amount selected for the Sum It Up play. The cost of a Sum It Up play is in addition to the cost of the Daily 4 play with which the Sum It Up play is connected.

(5) The cost of a ticket is determined by the total cost of the plays evidenced by the ticket.

(6) A player may complete up to five playboards on a single playslip.

(7) Acceptable methods to select numbers for a play may include:

(A) using a self-service terminal;

(B) using a playslip;

(C) requesting a retailer to use Quick Pick;

(D) requesting a retailer to manually enter numbers;

(E) using a previously-generated "Daily 4" ticket provided by the player; or

(F) using a QR code generated through a Texas Lottery Mobile Application offered and approved by the commission.

(8) Acceptable methods to select the play type, base play amount, and draw date and time for a play may include:

(A) using a self-service terminal;

(B) using a playslip;

(C) requesting a retailer to manually enter the selections;

(D) using a previously-generated "Daily 4" ticket provided by the player; or

(E) using a QR code generated through a Texas Lottery Mobile Application offered and approved by the commission.

(9) Playslips must be completed manually. A ticket generated from a playslip that was not completed manually, or using a selection method that is not approved by the commission, is not valid.

(10) A retailer may only accept a request for a play using a commission-approved method of play, and if the request is made in person.

(11) A player may purchase one or more plays for any one or more of the next 24 drawings after the purchase and may purchase up to 24 consecutive plays for a drawing time.

(12) A retailer shall issue a ticket as evidence of one or more plays. A ticket must show the numbers, play type and base play amount selected for each play; the number of plays, the draw date(s) for which the plays were purchased; and the security and transaction serial numbers. Tickets must be printed on official Texas Lottery paper stock, or, for third-party point-of-sale systems approved by the commission, printed on paper stock or otherwise issued in a manner approved by the commission to provide tangible evidence of participation in a lottery game.

(13) A playslip has no monetary value and is not evidence of a play.

(14) The purchaser is responsible for verifying the accuracy of the numbers and other selections shown on a ticket.

(15) An unsigned winning ticket is payable to the holder or bearer of the ticket if the ticket meets all applicable validation requirements.

(e) Cancellation of plays. A retailer may cancel a Daily 4 play only in accordance with the following provisions:

(1) The ticket evidencing the play must have been sold at the retail location at which it is cancelled;

(2) The retailer must have possession of the ticket evidencing the play;

(3) All Daily 4 plays evidenced by a single ticket must be cancelled;

(4) Cancellation must occur no later than 60 minutes after sale of the ticket evidencing the play;

(5) Cancellation must occur before the beginning of the next draw break after the sale of the ticket evidencing the play; and

(6) Cancellation must occur before midnight on the day the ticket evidencing the play was sold.

(f) Drawings.

(1) Daily 4 drawings shall be held four times a day, Monday through Saturday, at 10:00 a.m., 12:27 p.m., 6:00 p.m., and 10:12 p.m. Central Time. The executive director may change the drawing schedule, if necessary.

(2) At each Daily 4 drawing, four single-digit numbers shall be drawn. Each single-digit number will be drawn from a set that includes a single occurrence of all ten single-digit numbers (0, 1, 2, 3, 4, 5, 6, 7, 8, and 9).

(3) Numbers drawn and the order in which the numbers are drawn must be certified by the commission in accordance with the commission's draw procedures.

(4) The numbers selected in a drawing and the order of the numbers selected in the drawing shall be used to determine all winners for that drawing.

(5) Each drawing shall be witnessed by an independent certified public accountant. All drawing equipment used shall be examined by a lottery drawing representative and the independent certified public accountant immediately before each drawing and immediately after each drawing.

(g) Prizes.

(1) Prize payments shall be made upon completion of commission validation procedures.

(2) A person may win only one prize per play per drawing. A player who holds a valid ticket for a winning play is entitled to the highest prize for that play.

(3) A Sum It Up play is a separate play from the play with which it is connected.

(4) The executive director may temporarily increase any prize set out in this subsection for promotional or marketing purposes.

(5) A person who holds a valid ticket for a winning straight play is entitled to a prize as shown.

Figure: 16 TAC §401.316(g)(5) (No change.)

(6) A person who holds a valid ticket for a winning 4-way box play is entitled to a prize as shown.

Figure: 16 TAC §401.316(g)(6) (No change.)

(7) A person who holds a valid ticket for a winning 6-way box play is entitled to a prize as shown.

Figure: 16 TAC §401.316(g)(7) (No change.)

(8) A person who holds a valid ticket for a winning 12-way box play is entitled to a prize as shown.

Figure: 16 TAC §401.316(g)(8) (No change.)

(9) A person who holds a valid ticket for a winning 24-way box play is entitled to a prize as shown.

Figure: 16 TAC §401.316(g)(9) (No change.)

(10) A person who holds a valid ticket for a winning straight/4-way box play is entitled to a prize as shown.

Figure: 16 TAC §401.316(g)(10) (No change.)

(11) A person who holds a valid ticket for a winning straight/6-way box play is entitled to a prize as shown.

Figure: 16 TAC §401.316(g)(11) (No change.)

(12) A person who holds a valid ticket for a winning straight/12-way box play is entitled to a prize as shown.

Figure: 16 TAC §401.316(g)(12) (No change.)

(13) A person who holds a valid ticket for a winning straight/24-way box play is entitled to a prize as shown.

Figure: 16 TAC §401.316(g)(13) (No change.)

(14) A person who holds a valid ticket for a winning combo play is entitled to a prize as shown.

Figure: 16 TAC §401.316(g)(14) (No change.)

(15) A person who holds a valid ticket for a winning front-pair, mid-pair, or back-pair play is entitled to a prize as shown.

Figure: 16 TAC §401.316(g)(15) (No change.)

(16) A person who holds a valid ticket for a winning Sum It Up play is entitled to a prize as shown. A Sum It Up prize is in addition to a prize, if any, for a straight play, a box play, a straight/box play, or a combo play.

Figure: 16 TAC §401.316(g)(16) (.pdf)

(h) The executive director may authorize promotions in connection with Daily 4.

(i) Announcement of incentive or bonus program. The executive director shall announce each incentive or bonus program prior to its commencement. The announcement shall specify the beginning and ending time, if applicable, of the incentive or bonus program and the value for the award.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on December 11, 2017.

TRD-201705042

Bob Biard

General Counsel

Texas Lottery Commission

Effective date: December 31, 2017

Proposal publication date: October 20, 2017

For further information, please call: (512) 344-5012


SUBCHAPTER E. RETAILER RULES

16 TAC §§401.353, 401.361, 401.364, 401.370

The following amendments are adopted under Texas Government Code §466.015, which authorizes the Commission to adopt rules governing the operation of the lottery; and §467.102, which authorizes the Commission to adopt rules for the enforcement and administration of the laws under the Commission's jurisdiction.

This adoption is intended to implement Texas Government Code, Chapter 466.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on December 11, 2017.

TRD-201705043

Bob Biard

General Counsel

Texas Lottery Commission

Effective date: December 31, 2017

Proposal publication date: October 20, 2017

For further information, please call: (512) 344-5012


CHAPTER 402. CHARITABLE BINGO OPERATIONS DIVISION

It is the Order of the Texas Lottery Commission (Commission) that amendments to 16 TAC §§402.400 (General Licensing Provisions), 402.401 (Temporary License), 402.402 (Registry of Bingo Workers), 402.404 (License and Registry Fees), 402.405 (Temporary Authorization), 402.407 (Unit Manager), 402.410 (Amendment of a License- General Provisions), 402.411 (License Renewal), 402.413 (Military Service Members, Military Veterans, and Military Spouses), 402.420 (Qualifications and Requirements for Conductor's License), 402.422 (Amendment to a Regular License to Conduct Charitable Bingo), 402.424 (Amendment of a License by Electronic Mail, Telephone or Facsimile), and 402.603 (Bond or Other Security) are adopted with changes to the proposed text as published in the October 20, 2017, issue of the Texas Register (42 TexReg 5786). The adopted version of the rule conforms language in §402.404(d)(3) regarding renewal fees to match the license language in §402.404(a)(2)(A), and corrects a rule reference in §402.411(b).

The purpose of the rule amendments is to implement statutory changes required by newly-enacted HB 2578, SB 549, and SB 2065 from the Regular Session of the 85th Texas Legislature. The amendments remove all references to bingo conductor and worker fees, while revising the license application and renewal process. In addition, the amendments facilitate the HB 2578 requirement that the Commission retain a portion of the bingo prize fees otherwise allocable to counties and municipalities to fund the administration of the charitable bingo regulatory program. Further, the amendments allow commercial lessors, distributors, and manufacturers to recover up to half of their application fee if they withdraw their application before a license is issued or if their application is denied. The amendments also remove the licensing requirements for bingo unit managers while maintaining those managers' reporting and notification requirements. Last, the amendments correct typographical errors and make non-substantive conforming changes to the rules.

A public comment hearing was held on Wednesday, November 8, 2017, at 10:00 a.m., at 611 E. 6th Street, Austin, Texas 78701. The Department of Texas, Veterans of Foreign Wars (Texas VFW), and Texas Charity Advocates (TCA) provided comments at the hearing. The Commission also received written follow-up comments on the proposed amendments from the Texas VFW. The public comments and the Commission's responses are summarized below:

COMMENT SUMMARY: Regarding the language in §402.400, both commenters stated that a general reference to "supplemental forms" or "accompanying supplements" does not cover, going forward, new forms or revisions to existing forms that impose new requirements on a license holder.

COMMISSION RESPONSE: The proposed amendments to the language in §402.400 regarding "supplemental forms" and "accompanying supplements" is a conforming change to the rule language and is not intended to be a substantive change to any requirement or form. Previously, the rule referenced "applicable schedules," which was changed to match current Commission terminology, and "accompanying supplements," which was moved from the now-deleted §402.400(n) to the proposed §402.400(f). Any additional forms or revisions to forms in the future will meet all applicable legal requirements. The Commission declines to make changes to the proposed amendments in response to these comments.

COMMENT SUMMARY: Both commenters requested changes to §402.400(f)(2), which relates to a step in an optional eligibility process. The commenters requested that a specific timeline be included for the documents to be filed. And the commenters requested that organizations should not be forced to purchase a bond until the last step of this application process.

COMMISSION RESPONSE: The optional eligibility process outlined in §402.400(f) offers an organization a different pathway to receive a license to conduct bingo, and specifically references the submission of an application without a bond or other security among the items that could be initially excluded from the submission of an application for review. Upon review of that submitted application, an organization would receive a determination of licensure eligibility. If eligible for a license, the remaining items needed for license issuance would be a bond or other security in addition to the intended playing location, days, times and starting date of the bingo occasions. Because the facts of each applicant present different issues, the rule language was drafted to give the organization and the Commission flexibility throughout this process; a specific timeline could limit organizations' ability to become eligible and then have to restart their application. The optional process may in many cases take longer than the typical application process, but already allows the organization flexibility in submitting its bond later than it would under the normal application process. Furthermore, an organization would already know whether it is eligible before being required to submit a bond, unlike with the typical application process. Section 402.400(f)(2) is, for most purposes, the last possible step in an application. The Commission declines to make changes to the proposed amendments in response to these comments.

COMMENT SUMMARY: The Texas VFW commenter asked why §402.400(f)(3) requires an organization that had previously submitted certified meeting minutes stating that the organization voted to conduct bingo at the licensed location to repeat the task.

COMMISSION RESPONSE: The optional eligibility process outlined in §402.400(f) offers an organization a different pathway to receive a license to conduct bingo. The optional process may, in many cases, take longer than the typical application process. The Commission requires updated meeting minutes, current as of the supplemental submission, to ensure that the application requirements are still met and all required information is up to date. The Commission declines to make changes to the proposed amendments in response to this comment.

COMMENT SUMMARY: The TCA commenter requested that language in §402.400(n) be changed to allow a licensed attorney to represent an applicant or licensee by filing a letter with the Commission.

COMMISSION RESPONSE: As noted in the preamble, the primary purpose of the proposed amendments is to enact statutory changes required by newly-enacted HB 2578, SB 549, and SB 2065. The requested change is outside the scope of the proposed amendments. The Commission declines to make changes to the proposed amendments in response to this comment, but will take this comment under advisement as it considers future process changes.

COMMENT SUMMARY: The Texas VFW commenter stated that a proposed sentence in §402.402(s) (stating that payment for the employment of a non-registered worker is not an authorized bingo expense) is outside the scope of the current rulemaking.

COMMISSION RESPONSE: This sentence was moved from §402.402(g) as a non-substantive conforming change as outlined in the scope of rulemaking in the preamble. In revising §402.402 to remove all references to fees, this language was moved to make the rule more clear about its applicability. There is no substantive change. The Commission declines to make changes to the proposed amendments in response to this comment.

COMMENT SUMMARY: Both commenters stated that the references to conductor license classes by gross receipts identified in §402.404(a)(2)(A) are unnecessary given the absence of any license fee for conductors. While license classes for conductors are needed for bond purposes, the gross receipts attributed to conductor license classes should be removed from §402.404. Specifically, HB 2578 repealed the license fees for conductors. The license classes in Subsection (a)(2)(A) have nothing to do with the calculation of prize fees for which Commission staff has indicated that they will use this license class information. The Commission should use internal accounting to track this information and not require the organizations to provide the information.

COMMISSION RESPONSE: As both commenters noted, the Commission has indicated that the information contained in §402.404(a)(2)(A) is necessary for calculations related to the Bingo Division's operating budget. While the license-class-related information is not directly relevant to conductors after the changes in HB 2578, the amounts that the Commission is using to determine the Bingo Division's operating budget are relevant to the cities and counties that will have their prize fee share reduced. The Commission believes it is more transparent, and will provide fair and reasonable notice to affected persons, including local jurisdictions whose prize fee allocations are affected by HB 2578, to retain these totals in the rules. In addition, as at least one commenter acknowledged, this information is still required from the conductors for bond purposes. By keeping the information where it was already located, in §402.404, the proposed amendments are more understandable and smaller in scope. The commenters' suggested changes would require larger revisions to more rules. The Commission declines to make changes to the proposed amendments in response to these comments.

SUBCHAPTER D. LICENSING REQUIREMENTS

16 TAC §§402.400 - 402.402, 402.404, 402.405, 402.407, 402.410, 402.411, 402.413, 402.420, 402.422, 402.424

The rule amendments are adopted under the Texas Occupations Code §2001.054, which authorizes the Commission to adopt rules to enforce and administer the Bingo Enabling Act; Texas Government Code §467.102, which authorizes the Commission to adopt rules for the laws under the Commission's jurisdiction; and Section 13 of HB 2578 from the Regular Session of the 85th Texas Legislature, which required the Commission to adopt rules for its implementation.

The adopted amendments implement the Texas Occupations Code, Chapter 2001.

§402.400.General Licensing Provisions.

(a) Any person who wants to engage in a bingo related activity shall apply to the Commission for a license. The application must be on a form prescribed by the Commission and all required information must be legible, correct and complete. The initial submittal of an application is incomplete if the following information is not provided:

(1) All information requested on the application form and supplemental forms;

(2) All supplemental information requested during the pre-licensing investigation period;

(3) The applicable license fee for a lessor, distributor, or manufacturer; and

(4) Authorized signatures as required by the Commission.

(b) Information submitted by an applicant on an applicable form shall be considered to be part of the application. Supplemental information should be submitted on a form prescribed by the Commission and all information required must be correct and complete.

(c) Information submitted by an applicant in a format other than an applicable form must be legible and must include the following:

(1) the name and address of the organization as it appears on the application;

(2) the Texas taxpayer identification number; or, if sole owner, the individual's social security number;

(3) a statement identifying the information submitted;

(4) the signature, printed name and telephone number of the person authorized to submit the information; and

(5) all supplemental information requested during the pre-licensing investigation period.

(d) Within 21 calendar days after the Commission has received an original application, the Commission will review the application and notify the applicant if additional information is required.

(e) If an application is incomplete, the Commission will notify the applicant. The applicant must provide the requested information within 21 calendar days of such notification. Failure to provide the requested information within the 21 calendar day time line or providing incomplete information may result in the denial of the license application.

(f) For an application to conduct bingo, an organization may choose to submit the application form without including a bond or other security; information regarding previously held licenses; justice precinct, city or county certification; and information on intended playing location, days, times, and starting date.

(1) All other information requested on the application and the accompanying supplements must be complete and in compliance with all other requirements of the Bingo Enabling Act and the Charitable Bingo Administrative Rules.

(2) Within a number of calendar days required by the Commission on the applicable forms, the organization must remit the required bond or other security to the Commission and inform the Commission on the applicable supplemental forms of the intended playing location, days, times, and starting date of the occasions. If the organization fails to provide the required bond or other security as well as complete and accurate supplement forms within the required timeframe, the Commission will deny the application.

(3) An organization that has submitted the appropriate bond or other security and a complete application, including all applicable supplemental forms, must also submit updated, certified meeting minutes, current as of the submission of the applicable supplemental information, stating that the organization voted to conduct bingo at the licensed location.

(g) Prior to the issuance of a license, the Commission may require an applicant to attend a pre-licensing interview. The Commission will identify the person or persons for the applicant who must attend the pre-licensing interview. The pre-licensing interview will consist of, at a minimum, the following:

(1) review of the Bingo Enabling Act;

(2) review of the Charitable Bingo Administrative Rules;

(3) licensee responsibilities;

(4) process pertaining to the different types of license application;

(5) bookkeeping and record keeping requirements as it involves bingo; and

(6) a statement from the person or persons attending the pre-licensing interview that they are aware of and will comply with the provisions of the Bingo Enabling Act and the Charitable Bingo Administrative Rules.

(h) The Commission may deny an application based on information obtained that indicates non-compliance with the provisions of the Bingo Enabling Act and/or the Charitable Bingo Administrative Rules in connection with a pre-licensing interview and/or location inspection.

(i) Each licensed authorized organization issued a temporary authorization is required to file timely and complete required reports, as applicable to the type of licensing activity requested.

(j) A license applicant may withdraw an application at any time prior to the approval or denial of the application. Once the written request for withdrawal is received by the Commission, all processing of the application will cease and the withdrawal is considered final. License application fees for withdrawn license applications will be refunded, as provided for in the Bingo Enabling Act. If the organization wants to reapply for a license, a complete new application and new license fee, if applicable, are required.

(k) Voluntary surrender of a license.

(1) A licensee may surrender its license for cancellation provided it has completed and submitted to the Commission the prescribed form.

(2) If surrendering a license to conduct bingo, the prescribed form must be signed by the bingo chairperson.

(3) If surrendering any other type of license, the prescribed form must be signed by the sole owner, or by two officers, directors, limited liability corporation members, or partners of the organization.

(4) The cancellation of the license shall be final and effective upon receipt by the Charitable Bingo Operations Division of a copy of the resolution, or other authoritative statement of the licensee, requesting cancellation of the license and providing a requested effective date.

(A) The cancellation is effective as of the date identified in the letter provided that the date has not passed.

(B) If no date is identified in the letter, or the date has passed, the effective date shall be the date the Commission receives the letter.

(5) Notwithstanding cancellation of the license, the licensee must file all reports, returns and remittances required by law.

(6) The licensee shall surrender the license to the Commission on the effective date of the surrender.

(7) The Commission will send the licensee a letter confirming the surrender and resulting cancellation of the license.

(l) Administrative Hold. A licensed authorized organization or commercial lessor, other than an association of licensed authorized organizations, may request to place its regular license in administrative hold, but only at the time of license renewal, as provided in §402.411 of this Chapter.

(1) The placement of a license in administrative hold shall be effective on the first day of the license period for which the administrative hold is requested.

(2) The licensee shall submit the license in administrative hold, or a certified statement that the license is not available, to the Commission no later than seven (7) calendar days after the effective date of the placement of the license in administrative hold.

(3) Once the license has been placed in administrative hold, all bingo activity (i.e. leasing, conducting bingo) must cease until the licensee files an amendment and the amended license is issued by the Commission and received by the licensee. A licensed authorized organization with its regular license in administrative hold may not conduct bingo under a temporary license.

(4) Notwithstanding placement of the license in administrative hold, the licensee must file with the Commission:

(A) all applicable reports, returns and remittances required by law; and

(B) a timely and complete application for renewal of the license each time the license is ripe for renewal.

(5) If at the time of license renewal a licensed authorized organization does not have a designated playing location, that license will be placed in administrative hold.

(6) Except for licensed commercial lessors subject to §2001.152(b) of the Occupation Code, a license may not be in administrative hold for more than twelve (12) consecutive quarters.

(7) The fee for a license in administrative hold is set in §402.404(d)(3) of this Chapter.

(8) A license may be removed from administrative hold at any time during a license period. To remove a license from administrative hold, the licensee must file a license amendment application as provided in §2001.306 of the Occupations Code and §402.410 of this Chapter.

(m) Each person required to be named in an application for license under the Bingo Enabling Act other than a temporary license will have a criminal record history inquiry at state and/or national level conducted. Such inquiry may require submission of fingerprint card(s). FBI fingerprint cards are required for an individual listed in an application for a distributor or manufacturer's license and for an individual listed on an application who is not a Texas resident. A criminal record history inquiry at the state and/or national level may be conducted on the operator and officer or director required to be named in an application for a non-annual temporary license under the Bingo Enabling Act.

(n) Representation; personal receipt of documents. For purposes of this subsection, an individual shall be recognized by the Commission as an applicant or licensee's authorized representative only if the applicant or licensee has filed with the Commission a form prescribed by the Commission identifying the individuals currently listed as directors, officers, or operators, or if they are identified on the completed Authorization of Representation for Bingo Licenses form. A person is not an authorized representative of the applicant or licensee unless specifically named on a form prescribed by the Commission as part of the application, or on the Authorization of Representation for Bingo Licenses form that is on file with the Commission. Only those persons specifically named on a form prescribed by the Commission or on the Authorization of Representation for Bingo Licenses form as an authorized representative shall be recognized by the Commission concerning any matter relating to the licensing process or license. Only the applicant or licensee or its authorized representative may receive from the Commission documents relating to the application or license without being required to submit a request under the Public Information Act.

§402.401.Temporary License.

(a) Definitions. The following words and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise:

(1) Bingo liability--Includes, but is not limited to, any applicable license fee, late license renewal fee, prize fee, penalty, interest, or administrative penalty.

(2) Regular license--A license to conduct bingo that is effective for a period of one year unless revoked or suspended by the Commission. A regular license may be referred to as an annual license.

(3) Temporary license--A license to conduct bingo that is in effect for a single bingo occasion.

(b) General.

(1) Requirements. The Commission may not issue a temporary license if the applicant has failed to file a required report, failed to pay a bingo liability, has not distributed the proceeds calculated on the quarterly report for a charitable purpose, or has a regular license in administrative hold.

(2) Duration. A temporary license is valid for no more than four consecutive hours during any day.

(3) Display. The licensed authorized organization must conspicuously display during a temporary bingo occasion at the licensed bingo premises a temporary license, and, if applicable, verification of notification as referred to in subsection (d)(3)(D) of this section.

(4) Voluntary surrender of regular license.

(A) An authorized organization that no longer holds a regular license to conduct bingo may conduct any remaining designated temporary occasions so long as the total number of occasions does not exceed six per calendar year. If over six previously specified occasions remain, the licensed authorized organization must provide to the Commission written notification of no more than six of the dates of the temporary licenses that will be utilized. This notification must be provided within ten days of surrender of the regular license. The Commission will automatically revoke all temporary licenses in excess of the six per year.

(B) If the Commission denies or revokes a regular license by final and unappealable order, any temporary license held by the regular license holder that stated the specific date and time of any bingo occasion will likewise be denied or revoked.

(5) All records that are required to be maintained under a regular license must be maintained for a temporary bingo license.

(c) The playing time of a temporary bingo occasion may not conflict with the playing time of any other license at the bingo premises on that date unless otherwise provided by law.

(d) Regular license holder.

(1) A regular license holder must apply for a temporary license at least seven calendar days prior to the bingo occasion.

(2) Quarterly reports filed by a regular license holder must include proceeds from all licensed temporary occasions held during the quarter.

(3) The Commission may issue a temporary license to a regular license holder without listing the specific date or time of a bingo occasion. The temporary bingo occasion must be conducted at the same location as shown on the organization's regular license.

(A) The regular license holder must submit an application on the prescribed form that indicates the number of temporary licenses requested for the license period.

(B) The regular license holder must notify the Commission of the date and time the temporary license will be used by submitting a form prescribed by the Commission.

(C) Any temporary license issued without the specific date or time identified must be used prior to the expiration date of the regular license in effect at the time the temporary license application was filed.

(D) The Commission shall provide a verification of receipt of notification that must be posted adjacent to the applicable temporary license during the bingo occasion.

(4) In accordance with Occupations Code, §2001.108(e), the Commission may issue to a regular license holder additional temporary licenses in excess of the number of temporary licenses specified under Occupations Code, §2001.103(e) if the following conditions are met:

(A) The regular license holder submits a completed application on the form prescribed by the Commission;

(B) The date and times stated on the application are consistent with the day and times licensed to the organization that has ceased or will cease to conduct bingo as provided in Occupations Code, §2001.108; and

(C) The Commission has not acted on an amendment application filed under Occupations Code, §2001.108(a).

(5) If the organization is issued the amendment license filed under Occupations Code, §2001.108 prior to being issued the temporary license, the temporary license application shall be discontinued.

(e) Non-regular license holder. A non-regular license holder that wishes to conduct a bingo occasion must file a complete application for a temporary license on a form prescribed by the Commission at least 30 calendar days prior to the bingo occasion.

(1) If an organization has never received a temporary license or 3 years have elapsed since the organization last held a temporary bingo occasion, the organization must submit a Texas Application for Temporary Bingo Occasions for Non-Licensed Organization - Section 2.

(2) Organizations who have held a temporary license occasion in the past three years may submit Texas Application for a Temporary Bingo Occasions for Non-Licensed Organization - Section 1 to apply for a temporary license.

§402.402.Registry of Bingo Workers.

(a) Definitions. The following words and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise:

(1) Bingo Chairperson--an individual named in accordance with Texas Occupations Code §2001.002(4-a) and §2001.102(b)(6).

(2) Bookkeeper--an individual ultimately responsible for the preparation of any financial records for information reported on the Texas Bingo Conductor's Quarterly Report or for preparation and maintenance of bingo inventory records for a licensed authorized organization.

(3) Caller--an individual who operates the bingo ball selection device and announces the balls selected.

(4) Cashier--an individual who sells and records bingo card and pull-tab sales to bingo players and/or pays winners the appropriate prize.

(5) Completed Application--A registry application or renewal form prescribed by the Commission which is legible and lists at a minimum the applicant's complete legal name, address, social security number or registry number, date of birth, race, gender and signature.

(6) Manager--an individual who oversees the day-to-day operation of the bingo premises.

(7) Operator--means an active bona fide member of a licensed authorized organization that has been designated on a form prescribed by the Commission prior to acting in the capacity as the organization's operator.

(8) Provisional Employee--an individual who is employed by a licensed authorized organization as an operator, manager, cashier, usher, caller, or salesperson while awaiting the results of a background check, whether paid or not.

(9) Salesperson--an individual who monitors bingo players, sells bingo cards and pull-tabs, verifies winning cards and pull-tabs and/or delivers the prize money to the winners; may be referred to as an usher, floor worker, or runner.

(10) Usher--an individual who monitors bingo players, sells bingo cards and pull-tabs, verifies winning cards and pull-tabs and/or delivers the prize money to the winners; may be referred to as a salesperson, floor worker or runner.

(b) Who must be listed on the Registry of Approved Bingo Workers. Any individual who carries out or performs the functions of a caller, cashier, manager, operator, usher, salesperson, bookkeeper, or bingo chairperson as defined in subsection (a) of this section must be listed on the Registry of Approved Bingo Workers prior to being involved in the conduct of bingo.

(c) Each individual must submit a completed Texas Application for Registry of Approved Bingo Workers as prescribed by the Commission to remain on the Registry of Approved Bingo Workers.

(d) The registrant will be added to the registry as soon as possible after the Commission has determined that the individual is eligible to be involved in the conduct of bingo or act as an operator.

(e) For purposes of the Registry of Approved Bingo Workers, each operator, bookkeeper, and bingo chairperson must be designated on the licensed authorized organization's license to conduct bingo application.

(f) A licensed authorized organization must submit the name of a registered operator, bookkeeper, or bingo chairperson on a form prescribed by the Commission prior to the individual's acting in that capacity.

(g) A registered worker who fails to timely submit the prescribed form to renew listing on the registry may not be involved in the conduct of bingo until the individual is again added to the registry. It is the responsibility of the licensed authorized organization to review the registry to confirm that the individual's registration is current.

(h) How to be listed on the Registry of Approved Bingo Workers. For an individual to be listed on the Registry of Approved Bingo Workers, an individual must:

(1) submit a completed Texas Application for Registry of Approved Bingo Workers form as prescribed by the Commission;

(2) submit a verifiable FBI or DPS fingerprint card if at the time of registration:

(A) the individual is residing outside of Texas; or

(B) the individual maintains a driver's license or registration in another state; and

(3) be determined by the Commission to not be ineligible under Texas Occupations Code, §2001.105(a)(6) or the Commission's Rules.

(i) Incomplete Applications. The Commission will notify the applicant at the address provided if the registry application or renewal form submitted is not complete and will identify what is missing. The original application will be returned to the applicant for correction and resubmission. It is the responsibility of the registry applicant to resubmit a completed application before it may be processed. Failure to submit an FBI or DPS fingerprint card, if required, is grounds for denial or removal of the registration.

(j) An individual listed on the registry must notify the Commission of any changes to information contained on the Texas Application for Registry of Approved Bingo Workers on file with the Commission within 30 days of the change in information. Such notification shall be in writing or other approved electronic means.

(k) Identification Card for Approved Bingo Worker.

(1) The Commission will issue an identification card indicating that the individual is listed on the registry. A registered worker and operator must wear his/her identification card while on duty.

(2) The identification card worn by the registered worker or operator while on duty must be visible.

(3) The identification card shall list the individual's name, unique registration number and registry expiration date as issued by the Commission. An individual may obtain the unique registration number and registry expiration date from the Registry of Approved Bingo Workers on the Commission's website or by requesting the registration number and registry expiration date from the Commission.

(4) An identification card is not transferable and may be worn only by the individual identified on the card.

(5) Upon request by a Commission employee, an individual described in subsection (a) of this section shall present personal photo identification in order to verify the identification card is that individual's card.

(l) How to Obtain Additional Approved Identification Cards.

(1) A completed identification card may be obtained from the Commission by submitting the required form.

(2) An individual who has been approved to work in charitable bingo may complete an identification card form provided by the Commission for use while on duty. Blank identification card forms may be obtained from the Commission. The individual requesting the identification card form(s) must submit any required fee and the required form for the blank identification card form.

(3) The identification card prepared by the individual may only be on a prescribed Commission card form and must be legible and include the individual's name, unique registration number, and registry expiration date.

(m) A licensed authorized organization which is reporting conduct where there is a substantial basis for believing that the conduct would constitute grounds for removal or refusal to list on the registry shall make the report in writing to: Bingo Registry, Texas Lottery Commission, P.O. Box 16630, Austin, Texas 78761-6630.

(n) The provisions of the Texas Occupations Code §2001.313, related to the registry of bingo workers, do not apply to an authorized organization that does not have a regular license to conduct bingo who receives a temporary license to conduct bingo.

(o) If the Commission proposes to refuse to add or proposes to remove the individual from the Registry of Approved Bingo Workers consistent with Texas Occupations Code §2001.313, the Commission will give notice of the proposed action as provided by Government Code, Chapter 2001.

(p) An individual receiving notice that the Commission intends to refuse to add to or intends to remove the individual from the Registry of Approved Bingo Workers may request a hearing. Failure to submit a written request for a hearing within 30 calendar days of the date of the notice will result in the denial of the application or removal of the registered worker from the registry.

(q) An individual who has been denied or removed from the registry because of a conviction for an offense listed under Occupations Code §2001.105(b) will not be eligible to reapply to be listed. An individual who has been denied or removed from the registry because of a disqualifying criminal conviction not listed under Occupations Code §2001.105(b) may reapply to be listed no earlier than five years after the commission of the offense, or as otherwise allowed under the Commission's Rules.

(r) A provisional employee must:

(1) indicate the playing location(s) where the individual is provisionally employed on the Texas Application for Registry of Approved Bingo Workers form submitted to the Commission.

(2) immediately stop working:

(A) after 14 days if the individual is not listed on the registry and is a resident of this state.

(B) after 45 days if the individual is not listed on the registry, not a resident of this state, and submitted a fingerprint card for a background investigation. If the fingerprint cards are returned by the law enforcement agency as unclassifiable, the Commission will notify the individual, and the individual may continue to be provisionally employed by submitting a written request and new fingerprint cards within 14 days of the notification.

(C) if found to be ineligible on the basis of the background investigation.

(3) wear an identification card while on duty with the registry applicant's name, "Provisional Employment" as the unique registration number, and the submission date of the registry application as the expiration date.

(s) A licensed authorized organization who employs a provisional employee must maintain a copy of the registry applicant's completed Texas Application for Registry of Approved Bingo Workers form submitted to the Commission until the individual is listed on the registry or the licensed authorized organization is notified that the individual is not eligible to be listed. Payment for the employment of a provisional employee as outlined in subsection (a)(8) of this section is an authorized bingo expense; however, payment for non-registered workers is not an authorized bingo expense.

§402.404.License Classes and Fees.

(a) Definitions.

(1) License period--For purposes of Texas Occupations Code §2001.104 and §2001.158, the term "license period" means the four full calendar quarters immediately preceding the license end date.

(2) Regular License Classes and Applicable Fee Amount:

(A) There is no annual fee for a license to conduct bingo. The license-class-related amount used solely by the Commission to estimate the pro rata local share of prize fees related to licenses to conduct bingo shall be as follows:

(i) Class A (annual gross receipts of $25,000 or less) - $132;

(ii) Class B (annual gross receipts of more than $25,000 but not more than $50,000) - $264;

(iii) Class C (annual gross receipts of more than $50,000 but not more than $75,000) - $396;

(iv) Class D (annual gross receipts of more than $75,000 but not more than $100,000) - $528;

(v) Class E (annual gross receipts of more than $100,000 but not more than $150,000) - $792;

(vi) Class F (annual gross receipts of more than $150,000 but not more than $200,000) - $1,188;

(vii) Class G (annual gross receipts of more than $200,000 but not more than $250,000) - $1,584;

(viii) Class H (annual gross receipts of more than $250,000 but not more than $300,000) - $1,980;

(ix) Class I (annual gross receipts of more than $300,000 but not more than $400,000) - $2,640;

(x) Class J (annual gross receipts of more than $400,000) - $3,300.

(B) The annual fee for a commercial lessor license shall be as follows:

(i) Class A (annual gross rentals from licensed organizations of not more than $12,000) - $132;

(ii) Class B (annual gross rentals from licensed organizations of more than $12,000 but not more than $20,000) - $264;

(iii) Class C (annual gross rentals from licensed organizations of more than $20,000 but not more than $30,000) - $396;

(iv) Class D (annual gross rentals from licensed organizations of more than $30,000 but not more than $40,000) - $528;

(v) Class E (annual gross rentals from licensed organizations of more than $40,000 but not more than $50,000) - $792;

(vi) Class F (annual gross rentals from licensed organizations of more than $50,000 but not more than $60,000) - $1,188;

(vii) Class G (annual gross rentals from licensed organizations of more than $60,000 but not more than $70,000) - $1,584;

(viii) Class H (annual gross rentals from licensed organizations of more than $70,000 but not more than $80,000) - $1,980;

(ix) Class I (annual gross rentals from licensed organizations of more than $80,000 but not more than $90,000) - $2,640;

(x) Class J (annual gross rentals from licensed organizations of more than $90,000) - $3,300.

(C) Manufacturer's License. The annual fee for a manufacturer's license shall be $3,000.

(D) Distributor's License. The annual fee for a distributor's license shall be $1,000.

(b) Original License Application.

(1) Commercial License to Lease Bingo Premises.

(A) License fees for an original license to lease bingo premises submitted by an authorized organization licensed to conduct bingo must be paid from the organization's bingo bank account.

(B) An applicant may be required to submit additional license fees if the estimated gross rental income used to calculate the license fee is not reasonable when compared to the gross rental income at similarly situated bingo premises. These comparative amounts are used to establish the gross rental income amount upon which the applicant's license fee is based and must be submitted.

(2) Understating the anticipated gross receipts or rental income from a licensed activity for any purpose by an applicant or licensed entity may be grounds for administrative disciplinary action against the licensee.

(c) An organization shall re-estimate its annual gross rental income and submit any balance due in license fee amount if there is an increase within six months of the issuance of the original lessor license in:

(1) the number of organizations conducting bingo at a licensed location; and

(2) the number of bingo occasions conducted at the licensed location.

(d) License Renewal Fee.

(1) The amount of license fee to be paid upon renewal of a license to lease bingo premises is the recalculated license fee amount calculated for the preceding license period.

(2) If the recalculation of the license fee amount for the previous license period reflects an underpayment of the license fee amount for that license period, the incremental difference must be submitted by the organization within 30 days of the license expiration date and before the license may be renewed.

(3) Upon written request by an organization to renew its license to lease bingo premises that is in or going in administrative hold, the organization shall pay a Class A license renewal fee, plus any amount due under paragraph (2) of this subsection, in lieu of the recalculated fee amount from the preceding license period. There is no renewal license fee for an organization renewing its license to conduct bingo that is in or going in administrative hold, but the license-class-related amount used solely by the Commission to estimate the pro rata local share of prize fees related to a license to conduct bingo for such an organization is a Class A fee amount.

(4) The Commission may require an amount of license fee in addition to the recalculated fee at renewal if there is a change in:

(A) playing location; or

(B) rental amount per occasion.

(5) If a commercial lessor or a licensed authorized organization which leases bingo premises requests its license be placed in administrative hold upon the renewal of its lessor license and submits the requisite fee as set in paragraph (3) of this subsection, the Commission may require the commercial lessor to submit an additional license fee when it files the application to amend a commercial license to lease bingo premises, if the commercial lessor amends its license to begin leasing bingo premises within the first six months of the license term.

(e) Two-Year License Fee Payments. An applicant for a commercial lessor license that is effective for two years must pay an amount equal to two times the amount of the annual license fee, as set in §402.404(a)(2).

(f) Regular License Class Recalculation.

(1) For the purpose of determining the license class recalculation for a license to conduct bingo or license to lease bingo premises, the annual gross receipts or gross rental income, as applicable, shall be based on the four consecutive quarterly returns due immediately prior to the license expiration date.

(2) For the purposes of determining the license class recalculation for a two year license to lease bingo premises, each year of the license period shall be recalculated separately. The final recalculated fee will be the total of the yearly license classes and their associated fees. The annual gross rental income shall be based on the four consecutive quarterly returns due immediately prior to the first year period and the four consecutive quarterly returns due immediately prior to the license expiration date of the second year period.

(3) For accounting units, gross receipts used to recalculate the license class apportioned to a unit member will be calculated by dividing the unit's gross receipts by the total number of members during the quarter.

(4) If an organization fails to file a report for one or more quarter(s) of the license period, or if there are not four quarters available for any other reason, the Commission shall average the quarterly gross receipts or gross rental income for the quarter(s) reported to determine the organization's license class.

(5) License no longer exists.

(A) Notwithstanding the fact that an organization which leased bingo premises under a license that ceased to exist for whatever reason, the organization must submit the recalculated license fee for the period that the organization leased the premises and collected gross rental income.

(B) If an organization ceases to be licensed for whatever reason, all gross receipts or gross rental income collected (from the period after the last quarterly return used to recalculate the license class for the prior year) is used to recalculate the final license class, and if appropriate, any fee due. If the organization fails to file a return for any required period(s), an estimated return will be used. The organization shall submit any balance due after license class recalculation.

(6) The Commission may recalculate license classes for up to four consecutive immediately preceding license periods if a change in an organization's reported gross receipts or gross rental income occurs as a result of an audit, or if the original recalculation was determined by using estimated gross receipts or gross rental income.

(7) If there is a change in an organization's reported gross receipts or gross rental income, the organization may submit a written request to the Charitable Bingo Operations Division to recalculate its license class for up to four immediately preceding license periods.

(g) Overpayment of License Fee.

(1) An overpayment of a commercial lessor's annual license fee may occur either through a recalculation of the license fee pursuant to subsection (f) of this section, or if a licensee mistakenly submits more money than is actually required for the license fee(s). An overpayment of a manufacturer's or distributor's annual license fee occurs if a licensee mistakenly submits more money than is actually required for the license fee(s). The Commission will determine whether an overpayment has occurred on a case by case basis.

(2) Upon a determination that an overpayment of an annual license fee has occurred, the Charitable Bingo Operations Division shall credit the overpayment to the licensee. Overpayments credited to a licensee may be used for the licensee's outstanding bingo liabilities, including subsequent license fees, but the credits must be used within four years of the latest date on which the annual license fee was due. Overpayments credited to a licensee remain eligible for refund under subsection (h) of this section until the credits are used or the four year refund period expires, whichever comes first.

(3) Overpayments of annual license fees must either be used as credit or claimed for refund within four years of the latest date on which the annual license fees were due. If a licensee fails to use the credits or request a refund within this time period, the overpayments will be retained by the Commission.

(h) Refunds.

(1) An applicant or licensee may request a refund of the fee for an initial or renewal commercial lessor's license, initial or renewal distributor's license, or initial or renewal manufacturer's license if they request withdrawal of the application before the license is issued. Upon such a request, the Commission will retain the lesser of 50 percent of the fee or $150 and refund the rest of the fee within 30 days of receiving the request.

(2) If the Commission denies an initial or renewal commercial lessor license application, initial or renewal distributor's license application, or initial or renewal manufacturer's license application, it will retain the lesser of 50 percent of the fee or $150 and refund the rest of the fee within 30 days of denying the application.

(3) A current or former licensee that submits an overpayment of a regular license fee may be eligible to receive a refund of that overpayment, provided that the licensee or former licensee:

(A) submits a complete written request for a refund to the Commission within four years of the latest date the regular license fees were due;

(B) does not have any other outstanding bingo liabilities to the State; and

(C) if applicable, files all necessary quarterly reports.

(4) Upon the receipt and review of a timely and sufficient refund request, the Commission may either deny the refund request or certify to the Comptroller of Public Accounts that a refund is warranted. Pursuant to Government Code §403.077, if the Commission certifies to the Comptroller of Public Accounts that a refund is warranted, the ultimate decision on whether to grant the refund will still be made by the Comptroller of Public Accounts.

(i) Transfer of Commercial License to Lease Bingo Premises.

(1) All gross rental income collected in connection with a license to lease bingo premises that has been transferred during the term of the license shall be used to recalculate the license fee.

(2) A license fee credit in connection with a license to lease bingo premises that was transferred during the term of the license shall be credited to the current license holder at the time of license renewal.

(3) A license fee balance due for a license to lease bingo premises that was transferred during the term of the license shall be the liability of the current license holder at the time of license renewal.

(j) Temporary Authorization to Conduct Bingo.

(1) The amount of gross receipts collected in connection with a temporary authorization is used to calculate the regular license class.

(2) An organization conducting bingo pursuant to a temporary authorization must comply with the same statutory and administrative rule requirements and quarterly return filing requirements as an organization which has a regular license to conduct bingo.

§402.405.Temporary Authorization.

(a) A temporary authorization shall be issued only to a person who is not licensed by the Commission but who has filed a complete application for an original license to conduct a charitable bingo activity.

(b) Upon the applicant's request, the Commission will issue a temporary authorization for the activity requested on the license application by the 31st calendar day after the Commission's receipt of an application that is complete in accordance with §402.400(a) of this chapter if the following are in compliance with the Act and the Rules.

(1) For all licenses: eligibility of all persons listed on the application requiring criminal background investigations.

(2) For a commercial lessor license: eligibility of applicant as provided by Texas Occupations Code, §2001.152.

(3) If an applicant asserts in writing that its application is complete, the Commission will grant or deny the application, or make a determination on temporary authorization.

(c) A temporary authorization to conduct a bingo-related activity may only be issued to a person who will conduct a bingo-related activity at the same location for which the person has a pending original application to conduct a bingo-related activity.

(d) A temporary authorization shall be issued for a stated period of time not to exceed 60 days. A temporary authorization may be extended upon written request by the person to whom the temporary authorization was issued. Such request must be filed with the Commission at least seven working days prior to the time the temporary authorization expires. Extensions shall be for a period of time not to exceed 60 days. No more than two extensions may be issued.

(e) A request for an extension shall include:

(1) the complete name of the organization requesting the extension;

(2) the Texas taxpayer identification number of the organization requesting the extension;

(3) a complete explanation of the basis for the request; and

(4) the specific reason(s) supporting the need for an extension.

(f) An organization that is not in compliance with the Bingo Enabling Act and the Charitable Bingo Administrative Rules will not be granted an extension unless the organization becomes compliant during the period of the original temporary authorization.

(g) An organization conducting bingo under a temporary authorization that desires to obtain a temporary license shall be subject to the same requirements in §402.401(e) of this chapter regarding an organization not holding a regular license to conduct bingo.

(h) A temporary authorization is not a license.

(i) A temporary authorization may not be amended.

(j) A regular license that has been issued to an applicant shall expire one year from the date of the first issuance of any temporary authorization under this section.

(k) For the purposes of Texas Occupations Code, §2001.304(a), an application for an activity is considered issued or denied on the date the Commission issues a license or notice of denial to the applicant.

§402.407.Unit Manager.

Notification.

(1) An individual shall not provide services as a unit manager to licensed authorized organizations that have formed a unit until the following occurs:

(A) the Commission receives the unit accounting agreement executed by all members of the unit with the name of the unit manager designated therein; and

(B) the individual provides information to the Commission relating to the location where the unit manager services will be performed and where the records will be maintained.

(2) A unit manager shall provide written notification to the Commission of any change in the information in the unit manager's most recent notification to the Commission. The unit manager shall notify the Commission of the change in the information not later than the 15th day after the date of the change.

§402.410.Amendment of a License- General Provisions.

(a) The Commission will not approve a license amendment application with an effective date that is not within the licensed authorized organization's or commercial lessor's current license period.

(b) A licensee may amend a license renewal application prior to its approval.

(c) The term "effective date", when used in this section, means the first day that the amended changes are to begin.

(d) A licensee may not begin activities under the amended license until the following have occurred:

(1) the effective date; and

(2) licensee's receipt and display at the playing location of official written notification or the amended license authorizing the change.

(e) The fee to amend any commercial lessor, manufacturer, or distributor license issued under the Bingo Enabling Act shall be $10. The fee to amend a license to conduct bingo is $0.

(f) A licensee may request a refund of any license amendment fee paid if the licensee requests withdrawal of the amendment application before an amended license is issued. Upon such a request, the Commission will refund half of any fee paid within 30 days of receiving the request. If the Commission denies an amendment application, it will refund half of any fee paid within 30 days of that denial.

§402.411.License Renewal.

(a) Any license issued under the Bingo Enabling Act expires one calendar year or two calendar years from the first date of the license period, as specified on the license.

(b) In order to renew a license issued under the Bingo Enabling Act, a licensee must timely file an application for renewal with the Commission. The renewal application must be on a form prescribed by the Commission. The Commission will not approve a renewal application until the application is complete and the licensee submits the requisite fee pursuant to §402.404 of this title (relating to License Classes and Fees). A licensee is solely responsible for the timely filing of an application for renewal of its regular license.

(c) The Commission may notify licensees regarding the expiration of their license(s) and the potential for renewal. Failure of the licensee to receive the renewal notice(s) mailed by the Commission is not a mitigating circumstance for untimely filing of a renewal application.

(d) To be timely filed:

(1) the renewal application and payment, if applicable, of the estimated license fee must be received by the Commission no later than the license expiration date; or

(2) the renewal application's envelope postmarked date must clearly show a date that is no later than the license expiration date, unless the expiration date is a Saturday, Sunday, or legal holiday, in which event the application is due the next day which is not a Saturday, Sunday, or legal holiday; or

(3) an application bearing no legible postmark, postal meter date, or date of delivery to the common carrier shall be considered to have been sent seven calendar days before receipt by the Agency, or on the date of the document if the document date is less than seven days earlier than the date of receipt.

(e) Notwithstanding subsection (b) of this section, if a renewal application is not timely filed, a licensee may renew their license by filing a complete application for renewal with the Commission and, if applicable, submitting the requisite license fee and late license renewal fee. The late license renewal fee is based on the estimated license fee for the renewal period. Penalty amounts are calculated as follows:

Figure: 16 TAC §402.411(e) (.pdf)

(f) Any required late license renewal fee is due within 14 calendar days of the date of the written notification by the Commission of the amount due.

(g) The Commission will not issue a temporary license to a licensed authorized organization that has not filed its renewal application.

(h) A late license renewal fee is not refundable.

(i) License renewal applications received more than 60 days after the license expiration date will be returned unprocessed by the Commission to the sender.

(j) To be complete, an application for renewal must contain all information that is required to be provided in or with the initial license application, as well as any other information required by the Commission.

(1) All information submitted to the Commission must be legible, correct, and complete.

(2) If any information previously submitted to the Commission with the licensee's initial license application or a previous renewal application has not changed since the information was last submitted to the Commission, the renewal applicant need not provide that information again. The applicant must certify on the renewal application that no changes have been made to the specific information since it was last submitted to the Commission.

(k) Unless otherwise provided by law or rule, the general licensing provisions in §402.400 of this title (relating to General Licensing Provisions) shall govern the license renewal process, including the submission and review of the renewal application, as if the renewal application was an initial license application.

(l) Except as authorized by the Charitable Bingo Operations Director, or their designee, license renewal applications received by the Commission more than 60 days prior to the current license expiration date will be returned unprocessed by the Commission to the sender.

§402.413.Military Service Members, Military Veterans, and Military Spouses.

(a) The following terms used in this section are defined in §55.001 of the Occupations Code as follows:

(1) "Active duty" means current full-time military service in the armed forces of the United States or active duty military service as a member of the Texas military forces, as defined by §437.001, Government Code, or similar military service of another state.

(2) "Armed forces of the United States" means the army, navy, air force, coast guard, or marine corps of the United States or a reserve unit of one of those branches of the armed forces.

(3) "Military service member" means a person who is on active duty.

(4) "Military spouse" means a person who is married to a military service member.

(5) "Military veteran" means a person who has served on active duty and who was discharged or released from active duty.

(b) As soon as practicable after a military service member, military veteran, or military spouse applies in his or her individual capacity for a commercial lessor license, distributor license, manufacturer license, or listing on the bingo worker registry, the Commission will process the application and, if warranted, issue the license or list the applicant on the bingo worker registry. A military service member or military veteran must provide the Commission with definitive proof of his or her current or prior military service. A military spouse must provide the Commission with:

(1) definitive proof of his or her spouse's current military service; and

(2) his or her official marriage certificate or other definitive proof of his or her marriage to a military service member.

(c) The Commission will waive the license fee for a military service member or military veteran that applies in his or her individual capacity for a commercial lessor license, distributor license, or manufacturer license. The applicant must provide the Commission with definitive proof of the applicant's current or prior military service.

(d) The Commission will waive the license fee for a military spouse that applies in his or her individual capacity for a commercial lessor license, distributor license, or manufacturer license, provided that the applicant holds a current license issued by another state or jurisdiction that is substantially equivalent to the license for which the applicant is applying. The applicant must provide the Commission with:

(1) definitive proof of his or her spouse's current military service;

(2) his or her official marriage certificate or other definitive proof of his or her marriage to a military service member; and

(3) a photocopy of his or her current out-of-state license that is substantially equivalent to the license for which the applicant is applying.

(e) An individual licensed in his or her individual capacity as a commercial lessor, distributor, or manufacturer is exempt from the late license renewal fee provided for in §402.411(e) of this chapter if the individual can demonstrate, to the satisfaction of the Commission, that the individual failed to renew his or her license in a timely manner because the individual was serving as a military service member.

§402.420.Qualifications and Requirements for Conductor's License.

An applicant must provide with its application documentation demonstrating that it meets all qualifications and requirements for a license to conduct bingo based on the type of organization it is. The qualifications, requirements, and necessary documentation for different types of organizations are shown in the chart below.

Figure: 16 TAC §402.420 (.pdf)

§402.422.Amendment to a Regular License to Conduct Charitable Bingo.

(a) A licensed authorized organization must file a form prescribed by the Commission to amend its licensed:

(1) playing days;

(2) playing times;

(3) playing location;

(4) bingo chairperson;

(5) organization name; or

(6) primary business office.

(b) Playing days or playing times.

(1) An organization amending its playing day(s) or playing time(s) must specify on the form each playing occasion day and time that the organization intends to conduct bingo at the location.

(2) The playing day(s) or time(s) specified on the form may not:

(A) conflict with the playing day(s) or time(s) of any other application or license issued for that location;

(B) exceed the maximum number of bingo occasions per day allowed under Texas Occupations Code, §2001.419(c) and (d); or

(C) exceed three occasions during a calendar week or four hours per occasion.

(c) Playing location.

(1) An organization amending its playing location must return:

(A) its current bingo license if available, or a certified statement signed by the bingo chairperson indicating that the license is not available, unless the license is currently in administrative hold status or its renewal application is pending; and

(B) a copy of the meeting minutes recording that the organization voted to move the bingo playing location and indicating the exact playing location address and name of the location, if applicable.

(2) A licensee shall display a copy of its license at the current playing location if the license was surrendered upon application for an amendment.

(d) Organization name. An organization amending its organization name must submit a copy of the following:

(1) all amended organizing instruments reflecting the name change;

(2) written notice sent to the Internal Revenue Service updating the organization's record if the organization is required to maintain a 501(c) exemption;

(3) meeting minutes recording that the organization voted to change its name; and

(4) letter approving the name change from the parent organization, if applicable.

(e) Primary business office location.

(1) An organization may not relocate its primary business office to a different county solely for the purpose of relocating its bingo playing location. If the new location is not adjacent to the current county of its primary business office, the organization must have at least 20 percent of its members' residences located in the county to which the organization is moving.

(2) An organization changing its primary business office location must submit a copy of the following:

(A) meeting minutes recording that the licensed authorized organization voted to move its primary business office to the proposed location and the reason for the move;

(B) if moving to a non-adjacent county, the licensed authorized organization's membership list showing names and county of residence with at least 20 percent of the members' residences located in the non-adjacent county to which the organization is moving; and

(C) letter approving the organization's primary business office relocation to another county from the parent organization, if applicable.

(f) Meeting minutes submitted in accordance with subsections (c)(1)(B), (d)(3), and (e)(2)(A) of this section must be signed and certified as true and correct by an officer of the organization.

§402.424.Amendment of a License by Electronic Mail, Telephone or Facsimile.

(a) The term "effective date," when used in this section, shall mean the first day that the changes to the day(s) or time(s) bingo is conducted by the organization are to begin.

(b) A licensed authorized organization may change the day(s) or time(s) it conducts bingo by electronic mail, telephone or facsimile. The request should be received no later than noon the business day before the requested effective date of the amended license.

(1) To change by telephone the day(s) or time(s) the organization conducts bingo, an authorized requestor must speak directly to a License and Permit Specialist in the Licensing Services Department of the Charitable Bingo Operations Division, who will verify the caller's authority to request an amendment.

(2) To change by facsimile the day(s) or time(s) the organization conducts bingo, the Commission must receive a complete application at the facsimile number provided on the prescribed application form.

(3) To change by electronic mail the day(s) or time(s) the organization conducts bingo, the Commission must receive a complete application at the bingo service electronic mail address provided on the prescribed application form.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on December 11, 2017.

TRD-201705039

Bob Biard

General Counsel

Texas Lottery Commission

Effective date: December 31, 2017

Proposal publication date: October 20, 2017

For further information, please call: (512) 344-5392


SUBCHAPTER F. PAYMENT OF TAXES, PRIZE FEES AND BONDS

16 TAC §402.603

The following rule amendments are adopted under the Texas Occupations Code §2001.054, which authorizes the Commission to adopt rules to enforce and administer the Bingo Enabling Act; Texas Government Code §467.102, which authorizes the Commission to adopt rules for the laws under the Commission's jurisdiction; and Section 13 of HB 2578 from the Regular Session of the 85th Texas Legislature, which required the Commission to adopt rules for its implementation.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on December 11, 2017.

TRD-201705040

Bob Biard

General Counsel

Texas Lottery Commission

Effective date: December 31, 2017

Proposal publication date: October 20, 2017

For further information, please call: (512) 344-5392