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 5   
 6                 BINGO ADVISORY COMMITTEE 
 7                          MEETING
 8                             
 9                     FEBRUARY 15, 2006
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11   * * * * * * * * * * * * * * * * * * * * * * * * * * * 
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19             BE IT REMEMBERED that the BINGO ADVISORY 
20   COMMITTEE meeting was held on the 15th of FEBRUARY, 
21   2006, from 10:05 a.m. to 1:25 p.m., before Shelley N. 
22   Jones, RPR, CSR in and for the State of Texas, 
23   reported by machine shorthand, at the Offices of the 
24   Texas Lottery Commission, 611 East 6th Street, Austin, 
25   Texas, whereupon the following proceedings were had: 
0002
 1                        APPEARANCES
 2   
 3   Chairperson:
              Ms. Suzanne Taylor - Corpus Christi, Texas
 4   
     Committee Members:
 5            Mr. Daniel Moore - Houston, Texas
              Mr. Larry Whittington - Dallas, Texas
 6            Mr. Mario Manio - Garland, Texas 
              Mr. Jack Dougherty - Austin, Texas
 7            Ms. Kimberly Rogers - San Antonio, Texas
              Ms. Rosie Lopez - Odessa, Texas
 8            Mr. Thomas Weekley - McAllen, Texas
 9   Charitable Bingo Director:
              Mr. Billy Atkins
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22   
23   
24   
25   
0003
 1                           INDEX
 2   Appearances.......................................   2
 3   AGENDA ITEMS
 4   ITEM NUMBER 1....................................    4
 5   ITEM NUMBER 2....................................    4
 6   ITEM NUMBER 3....................................    5
 7   ITEM NUMBER 4....................................   17
 8   ITEM NUMBER 5....................................   20
 9   ITEM NUMBER 6....................................   27
10   ITEM NUMBER 7....................................   46
11   ITEM NUMBER 8....................................  105
12   ITEM NUMBER 9....................................  107
13   ITEM NUMBER 10...................................  108 
14   ITEM NUMBER 11...................................   96 
15   ITEM NUMBER 12...................................  138
16   ITEM NUMBER 13...................................  140
17   ITEM NUMBER 14...................................  143
18   ITEM NUMBER 15...................................  151
19   ITEM NUMBER 16...................................  154
20   ITEM NUMBER 17...................................  155
21   
22   Errata Sheet.....................................  156
23   Reporter's Certificate...........................  157
24   
25   
0004
 1                     February 15, 2006
 2             Bingo Advisory Committee Meeting
 3                 CHAIRPERSON TAYLOR:  It's 10:05.  We do 
 4   have a quorum, so we're going to call the meeting to 
 5   order.
 6                 Before I start, I would like to welcome 
 7   two very special guests.  We have Commissioner Clowe 
 8   here with us and Anthony Sandberry, and we have to 
 9   welcome both of them.  We really appreciate you coming 
10   to the meeting and putting this in your busy schedule.
11                 Item Number 1 on the agenda, we have 
12   done that.  We've called us to order.
13                 Item Number 2, consideration of and 
14   possible discussion and/or action on minutes of the 
15   November 2nd, 2005, Bingo Advisory Committee meeting.
16                 Those were posted on line.  Is there a  
17   motion to approve those posted?  
18                 MS. ROGERS:  I motion.
19                 CHAIRPERSON TAYLOR:  Kim has made a 
20   motion.  Is there a second?  
21                 MR. DOUGHERTY:  I will second.
22                 CHAIRPERSON TAYLOR:  Seconded by Jack.
23                 MR. DOUGHERTY:  Yes.
24                 CHAIRPERSON TAYLOR:  All in favor.
25                 THE COMMITTEE MEMBERS:  Aye.
0005
 1                 CHAIRPERSON TAYLOR:  Opposed.
 2                 It carries.
 3                 Item Number 3, report and possible 
 4   discussion and/or action on the proposed amendments to 
 5   16 TAC 402.600 pertaining to bingo reports.
 6                 Good morning.
 7                 MS. JOSEPH:  Good morning.  For the 
 8   record, my name is Sandy Joseph, assistant general 
 9   counsel in the legal division.  I have several rule-
10   making efforts to report to you on this morning.
11                 This is the first one, and this rule 
12   pertains to rule 16 TAC Section 402.600, regarding 
13   payment of taxes, prize fees, and bonds.  This rule-
14   making was published in the Texas Register on February 
15   3rd for public comment, in a response to a petition 
16   from Stephen Fenoglio.  Mr. Fenoglio petitioned the 
17   commission asking they consider this rule-making.
18                 Just for your general information, when 
19   we receive a petition for rule-making, by law, we 
20   have -- or excuse me -- the commissioners have 30 days 
21   to either grant the petition for consideration of 
22   rule-making or for denying the petition.
23                 So because of that short time frame, it 
24   was not possible to present this in motion or acted at 
25   one of your meetings beforehand, just in case you were 
0006
 1   wondering about that.  Usually you do know about rule-
 2   makings a little earlier than the time they appear in 
 3   the Texas Register.
 4                 But what this rule will do if adopted 
 5   is modify the requirement that an application or a 
 6   renewal application be denied at times when the 
 7   quarterly reports have been filed late.
 8                 This will actually ease the -- the 
 9   burden on folks and provides that that will only be 
10   revoked if they're -- if an organization has been late 
11   three times within previous 12 months or within 12 
12   consecutive months and also if there's been a jeopardy 
13   determination made.  The current rule does not have 
14   that provision about a jeopardy determination being 
15   made.
16                 There was a public hearing held on this 
17   rule last Wednesday.  Mr. Fenoglio appeared and 
18   offered comments in support of the rule.  We have 
19   noted that there is one clerical error in the rule as 
20   proposed in Section L.  There is a citation to the 
21   Texas Government Code and that should have been the 
22   Texas Occupation Code.  And, of course, we would 
23   change that prior to any adoption.
24                 The comment deadline for this rule is 
25   March 5th.  So there is still an opportunity for you 
0007
 1   or anyone else to provide public comments on this rule 
 2   if they so choose.
 3                 Do you have any questions?  
 4                 I don't know if you may wish to 
 5   consider whether you would like to provide comments on 
 6   this as a group.
 7                 CHAIRPERSON TAYLOR:  Okay.  Any 
 8   comments from the members at this time?  
 9                 MS. LOPEZ:  I think this clearly 
10   identifies that, you know, you must file your reports 
11   on a timely manner within a 12-month period.  So I 
12   think that pretty much says it.
13                 MS. JOSEPH:  Yes.
14                 CHAIRPERSON TAYLOR:  Well, Sandy, 
15   previously what -- what did it actually read?  It was 
16   less amount of time or...
17                 MS. JOSEPH:  Previously if you were one 
18   day late that would count as one of, quote, the 
19   strikes against you.  I have with us today -- or we 
20   have with us Terry Shankle who is manager of the area 
21   that is responsible for this, and I think she would be 
22   the expert on addressing any technical questions.
23                 MS. SHANKLE:  Good morning.  My name is 
24   Terry Shankle, T-e-r-r-y S-h-a-n-k-l-e.
25                 The time line in the previous rule or 
0008
 1   the rule as it is today says that we will deny or 
 2   revoke a license for someone that files their 
 3   quarterly -- pays their prize fees late three times 
 4   within a 12-month period.  As Sandy was saying, yes, 
 5   that does mean one day late.  It does mean ten days 
 6   late, whatever.
 7                 So what the rule does now, as she was 
 8   saying, 12 months, the -- the rule as it is proposed 
 9   says that we will deny or revoke a license if you're 
10   late three times with -- within four quarters and a 
11   jeopardy determination has become final.  So long as 
12   that jeopardy determination becomes final, then that 
13   is when we would go to hearing to revoke or deny the 
14   license.  And it must be three jeopardy determinations 
15   becoming final within those three consecutive 
16   quarters.
17                 CHAIRPERSON TAYLOR:  And what is the 
18   definition of a jeopardy determination.
19                 MS. SHANKLE:  A jeopardy determination 
20   is defined in the Bingo Enabling Act.  It states that 
21   if a state verifies their money is in jeopardy, we can 
22   move forward.  It gives us the ability to start our 
23   collection actions.  It is 20 days after the date of 
24   the notice, that we've given the organization or the 
25   lessor, at the time money is due.
0009
 1                 CHAIRPERSON TAYLOR:  Okay.  So what -- 
 2   I had read this, but I didn't have a set of rules to 
 3   be able to -- to read exactly what it -- so what 
 4   exactly is the change?  
 5                 MS. SHANKLE:  Well, the change is:  
 6   Again, we're going from a 12-month period to four 
 7   quarters.  Also --
 8                 CHAIRPERSON TAYLOR:  Okay.  So we're 
 9   just now starting from January to December.  It's 
10   just -- 
11                 MS. SHANKLE:  It's based on four 
12   quarters.
13                 CHAIRPERSON TAYLOR:  Okay.
14                 MS. SHANKLE:  That's right.
15                 CHAIRPERSON TAYLOR:  Okay.  I get it.
16                 MS. SHANKLE:  And, again, that if we 
17   give the organization or the licensee an opportunity 
18   to file more than -- well, to have more of a time in 
19   which to file and pay the prize fees than if they were 
20   just one day late.  We would look at them if they were 
21   one day late over a 12-month period.  If it was three, 
22   it would start a clock. There's nothing that could be 
23   done other than to deny or revoke the license.
24                 MR. ATKINS:  And I think that's 
25   probably -- if I can jump in -- the essence of what 
0010
 1   drove Mr. Fenoglio's petition is the fact that there 
 2   were organizations that were filing one, two, three, 
 3   days late.  They were paying the penalty associated 
 4   with late filing and there were even instance where we 
 5   would go to hearing, the license would be revoked, and 
 6   the organizations would come before the commission, 
 7   which -- with an explanation, which I believe, without 
 8   speaking for the commissioners, they found to be 
 9   plausible in terms of activities that occurred within 
10   their organization, such as an individual being ill or 
11   whatever that caused this late filing.
12                 So with the amendments to this rule, it 
13   would, as Terry said, the -- the, I guess, drop dead 
14   requirement under the rule for going to hearing on an 
15   organization is if in that 12-month period that Terry 
16   is talking about, the organizations have three 
17   jeopardy determinations becoming final.  And, again, 
18   there is a -- a 20-day period after the filing of a 
19   deadline before that jeopardy determination becomes 
20   final.
21                 Now, just for the advisory committee's 
22   information, at least one of the commissioners did 
23   raise the issue about what I think he referred to as 
24   kind of gamesmanship in organizations that would, you 
25   know, continually, you know, file late knowing that 
0011
 1   they wouldn't be subject to this rule unless a 
 2   jeopardy determination became final and, you know, we 
 3   did point out to the commissioner that actually under 
 4   statute the organization -- the agency, you know, can 
 5   go to hearing for, you know, a one-time occurrence.
 6                 So I think that that answered the 
 7   commissioners question, but I -- I do want the 
 8   advisory committee to have the benefit of that 
 9   conversation.
10                 MS. JOSEPH:  Just in general, I would 
11   like to add when you look at rules that have been 
12   published in the Texas Register -- you were asking if 
13   we can -- how do you tell what the old language was, 
14   and I should have quickly pointed out to you that new 
15   language is underlined and old language is bracketed.  
16   So language that's proposed to be deleted from the 
17   rule has brackets around it.  The new language is 
18   underline.  So that can -- that can help you figure 
19   out what's going on.
20                 CHAIRPERSON TAYLOR:  Thank you.
21                 MR. DOUGHERTY:  Do I -- as I understand 
22   it, following up on Suzanne's comment about late, one 
23   day was a penalty before.  Now it is covered by timely 
24   paying.  Is that correct?  In other words, there's no 
25   so many days late, no specific days late.
0012
 1                 MS. JOSEPH:  Right.  And there were not 
 2   specific days before, but the effect of it was even if 
 3   it's one-day late.
 4                 MR. DOUGHERTY:  There's no specific 
 5   deadline on this kind of stuff.
 6                 MS. JOSEPH:  Well, the -- the deadline 
 7   is the 15th -- the 25th.  The 25th.
 8                 MR. DOUGHERTY:  All right.  That's good 
 9   enough.
10                 CHAIRPERSON TAYLOR:  Are we looking for 
11   a consensus with the BAC, or is this just 
12   information?  
13                 MR. ATKINS:  It is for the BAC, if they 
14   would like to comment.  Again, there was a public 
15   hearing that was held on February 8th.  And if that's 
16   correct, the only commenter was Mr. Fenoglio.
17                 MS. JOSEPH:  That's correct.
18                 MR. ATKINS:  The rule is ripe for 
19   between until, I believe, March 5th.  So if it's the 
20   advisory committee's preference to make or not make a 
21   comment as a whole, they can do that in this meeting.  
22   Or individual members can, of course, comment on the 
23   rule and that can even be done on line through the 
24   agency's website.
25                 MS. LOPEZ:  I have a question -- 
0013
 1                 MR. WEEKLEY:  Can I ask -- 
 2                 MS. LOPEZ:  I --
 3                 MR. WEEKLEY:  Can I ask a question?  
 4                 MS. LOPEZ:  I'm sorry.
 5                 MR. WEEKLEY:  This is basically a 
 6   loosening of the rule pertaining to payment is what I 
 7   hear.  Is there very much of that late payment?  Do 
 8   you -- as a matter of course, do the unit and the 
 9   charities pay late?  Is this a problem with your -- 
10   the collection of the taxes.
11                 MS. JOSEPH:  I'll let Ms. Shankle 
12   respond to that.
13                 MR. ATKINS:  As -- as Terry is coming 
14   up, let me give you a little bit of background, Tom.
15                 When bingo came over to the Lottery 
16   Commission, I would say it was a significant problem 
17   in terms of organizations filing late.  And there was 
18   also a problem with the fact that organizations would 
19   wait until the agency had gone to a lot of effort to 
20   go through the administrative hearing process and 
21   would often times actually show up at the hearing with 
22   the check and want to stay the administrative hearing, 
23   or they would even come in after we had gone through 
24   the administrative hearing process and the 
25   organization -- and the judge had issued a decision to 
0014
 1   deny or revoke the license for failure to pay.
 2                 So that's what prompted the rule 
 3   originally when it was first developed.  I think -- 
 4   and Terry can correct me if I'm wrong -- but I think 
 5   that we've seen a decrease.
 6                 MS. SHANKLE:  Absolutely, we have.
 7                 And I want to point out, Jack, to you 
 8   is that even when we've loosened it now, they -- if 
 9   they do file late, there is a penalty.  One to 30 days 
10   is a 5 percent penalty.  So they are still being 
11   assessed that, but it's just that we're not moving 
12   forward to come to a hearing to deny or revoke their 
13   license.
14                 MR. DOUGHERTY:  Thank you.  That does 
15   help.
16                 MR. WEEKLEY:  Yeah.  That -- that makes 
17   a difference.  If they are still paying the penalty -- 
18                 MS. SHANKLE:  They certainly are.
19                 MR. WEEKLEY:  -- then I would have no 
20   objection to this.  It doesn't matter in my opinion.
21                 MR. DOUGHERTY:  So the hook is still 
22   there.
23                 MR. WEEKLEY:  Yeah.
24                 MR. DOUGHERTY:  It's just eased up a 
25   little bit.
0015
 1                 MS. SHANKLE:  Yes, sir.
 2                 MS. LOPEZ:  I just want to ask:  How is 
 3   this being made available so that all organizations 
 4   are aware of that, of course, the amended rule or the 
 5   proposed rule that all organizations know that we are 
 6   totally responsible for making sure that our reports 
 7   are filed in a timely manner within, you know, the 
 8   consecutive four months because if we filed late three 
 9   times consecutively, then that's what we would be 
10   faced with the possibility of having our license 
11   revoked.  
12                 How are we ensuring that all of the 
13   organizations throughout the state have received this 
14   information and know about it.
15                 MR. ATKINS:  Well, I think there are a 
16   number of ways we do that.  And, first of all, the 
17   possibility of an organization's license being revoked 
18   or denied is -- you know, can exist as the result of a 
19   failure to file one time.  And that's contained in the 
20   statute.
21                 And, as you know, every organization is 
22   required to have a member of their organization that 
23   has gone the operator training program.  And one of 
24   the things that those individuals do is they certify 
25   to us that their organization had read the act and 
0016
 1   rules in their entirety and that they understand them 
 2   and what they are responsibility for.  Plus, all the 
 3   organizations on the application that they submit 
 4   state that they read the act and rules and they 
 5   understand what they are responsible for.
 6                 Specific to this rule, as I mentioned 
 7   earlier, it has been posted on our website which is 
 8   available to organizations.  Prior to that even, 
 9   Rosie, there were different notifications that were 
10   provided to organizations prior to these amendments.  
11   And I would ask Ms.Shankle to point out exactly 
12   what -- what those were.
13                 MS. SHANKLE:  Well, we've also written 
14   articles and placed them in the Bingo Bulletin making 
15   everyone aware.  And even to the point when we send 
16   out a letter, if a -- if a licensee is delinquent in 
17   paying their prize fees, we were saying in the letter 
18   that if you -- if you're late two more times within a 
19   12-month period we're going to have to go forward.  So 
20   we were notifying them personally how many times they 
21   could file late before we revoked their license.
22                 MS. LOPEZ:  So it's a letter.
23                 MS. SHANKLE:  So we have it on our 
24   website.  We have it published in our Bingo 
25   Bulletins.  And also on our billings, we would say -- 
0017
 1   that we would cite that particular citation or that 
 2   rule that says that we will deny or revoke if you file 
 3   late three times within that 12-month period.
 4                 CHAIRPERSON TAYLOR:  Okay.  Is there a 
 5   motion?  
 6                 MR. MOORE:  Yeah, I can make a motion 
 7   to the BAC endorse the proposed amendment to TAC 
 8   402.600 pertaining to bingo reports.
 9                 CHAIRPERSON TAYLOR:  Is there a 
10   second?  
11                 MR. WEEKLEY:  (Raises hand.)
12                 CHAIRPERSON TAYLOR:  All in favor.
13                 THE COMMITTEE MEMBERS:  Aye.
14                 CHAIRPERSON TAYLOR:  Opposed?
15                 Thank you.
16                 Moving on to our next item, Item Number 
17   4, report and possible discussion and/or action 
18   pertaining to the progressive bingo work group.
19                 Sandy.
20                 MS. JOSEPH:  Again, I'm Sandy Joseph, 
21   assistant general counsel.
22                 I would like to give you just a quick 
23   look forward on what the work group that has been 
24   designated to work on styles of play, slash, 
25   aggressive bingo, possible rule amendments has done, 
0018
 1   that we held our first work group meeting on January 
 2   26th.  Rosily and Mario both participated in that work 
 3   group.  Danny Moore and also Joe Garcia are going to 
 4   be on that work group, but they had last minute -- 
 5   other concerns come up that prevented them from being 
 6   there.  So we had a very short initial first meeting, 
 7   but we did make some decisions on moving forward, I 
 8   think.
 9                 Everyone, both Mario and Rosily, were 
10   supportive of the idea of working on this possible 
11   rule-making.  And what the goal is essentially is to 
12   possibly amend the rule or come up with a new rule 
13   that would address different styles of play in order 
14   to make more organizations aware of other possible 
15   ways of playing bingo until you spell out or give more 
16   detail on how you would handle your bookkeeping, so to 
17   speak, on this.
18                 And Billy can expand on this, of 
19   course, if you would like.
20                 What we did at our first meeting was 
21   Mario agreed, and also Rosily, that they would start 
22   being on the lookout and thinking about other styles 
23   of play that might be worth while to look at besides 
24   progressive bingo.  The staff is going to go ahead and 
25   do a first draft of a possible rule amendment on 
0019
 1   progressive bingo.
 2                 We are going to be looking at what 
 3   other states have done on this, possibly as a starting 
 4   point.  And once the staff has the draft completed 
 5   they will be circulating that and getting comments 
 6   back from the work group and we'll be just continuing 
 7   on that effort.
 8                 I don't know if Rosily or Mario would 
 9   like to add anything at this time.
10                 MS. LOPEZ:  No.  Again, I think that we 
11   had a telephone -- 
12                 MR. MANIO:  No.
13                 MS. JOSEPH:  And Rose and I have been 
14   working via telephone.
15                 MS. LOPEZ:  And I think it's been real 
16   informative on my part to really understand a lot of 
17   the different types of rule-makings that it takes to 
18   be able to conduct charitable bingo so it's been real 
19   informative to me.
20                 MS. JOSEPH:  All right.  And as for the 
21   working on this, it -- you know, we came back -- it 
22   came back into my awareness, at least, that we already 
23   had a work group on other possible styles of play that 
24   Danny was chairing.  And so there has been some 
25   discussion about possibly combining our two groups.
0020
 1                 Billy, would you like to comment on 
 2   that?  Or Dan.
 3                 MR. ATKINS:  -- I --
 4                 MR. MOORE:  Go ahead.
 5                 MR. ATKINS:  Okay.  I did.  And, Madam 
 6   Chair, if it's okay if we also take up Item 5 at the 
 7   same time.
 8                 CHAIRPERSON TAYLOR:  Absolutely.
 9                 MR. ATKINS:  Part of how to stand out 
10   is -- if you'll recall from the last meeting what 
11   staff was seeking to do was look at the development of 
12   the progressive bingo rule that fits within the 
13   current statutory requirements and limitations of the 
14   Bingo Enabling Act.
15                 So with Sandy and the work group and 
16   their meeting, that did evolve to a discussion of just 
17   different types of bingo games that are out there, 
18   some of which may already be being conducted, some of 
19   which we may not be aware of.  And what we did was we 
20   went back and we actually looked at an existing rule, 
21   the bingo paper rule 402.301.  And some members may 
22   recall that shortly after the work was done on the 
23   pull-tab rule, we looked at bingo paper and getting 
24   additional type of paper games that could be 
25   authorized for use in the State of Texas also.  And we 
0021
 1   began with a -- what I think is a very rough beginning 
 2   of kind of these alternative types of games in 
 3   addition to progressive bingo games.
 4                 If you go back and look when you get a 
 5   chance at 402.301, it references, you know, wild-ball 
 6   games and odd-even games.  And so what we started 
 7   talking with Sandy about is the possibility of, like 
 8   she says, expanding this progressive bingo work group 
 9   to include some of those additional types of games 
10   that -- you know, our first idea was to put all those 
11   games in one rule so that they would be available to 
12   all organizations throughout the state.
13                 I know there has been some discussions 
14   about doing rules specific to certain types of games.  
15   I think that that's something that the work group, you 
16   know, can flesh out as they -- as they get into it a 
17   little deeper.  But I know, Rosie, you and Mario were 
18   going to go back and see if there additional games 
19   that could also be included in there.  And so that's 
20   why we had put it on there, on this agenda, Number 5, 
21   alternative styles work group, to raise the 
22   possibility of combining these two work groups and 
23   what they are doing.
24                 MS. JOSEPH:  Danny, do you have any 
25   comment?  
0022
 1                 MR. MOORE:  Well, we -- we noticed an 
 2   increase in all of us using double action paper, which 
 3   is a type of paper where there's two numbers on each 
 4   square.  I've seen more halls using that.  U pick'em 
 5   games have become a little more popular over the last 
 6   couple of years.  And they are available right now.  
 7   You just need to contact your distributors for those 
 8   things.
 9                 MR. ATKINS:  And those were some of the 
10   games that were addressed through the revised paper 
11   rule.
12                 MR. MOORE:  That's correct.
13                 MR. ATKINS:  And those are -- those are 
14   the type things that we like to somehow publicize more 
15   for non-organizations as possible for alternatives or 
16   additions to their existing games.
17                 MR. MOORE:  Right.  And also, Billy, I 
18   think probably a year and a half or so ago, I think 
19   there's been a couple of states that have actually 
20   brought in progressive bingo.  I think, if you want to 
21   look, Mario, Michigan, I think, is one of them.  And 
22   it's become kind of popular up there.  But it's got an 
23   expanded pay-out too I think.  So I don't know.  You 
24   could probably look at that also.
25                 MR. ATKINS:  Well, what I envision this 
0023
 1   work group doing so far is focusing on progressive 
 2   within the current statutory limitations.
 3                 MR. MOORE:  Okay.
 4                 MR. ATKINS:  And then if there, you 
 5   know, there are other private interests that want to 
 6   take that before the legislature, you know, and look 
 7   at -- I believe previous legislation has addressed 
 8   this.  What it's done specifically is exempt 
 9   progressive games from current prize limitations.
10                 MR. MOORE:  That's correct.
11                 MR. ATKINS:  I think that would be a 
12   matter for a legislature to take up.  What we wanted 
13   to look at again was the options that we could afford 
14   given current statutory limitations.  So we recognize 
15   that to a large degree, for example, this progressive 
16   game, may be something that's of more interest to 
17   smaller halls, you know, maybe to give away smaller 
18   prizes in the twenty-five to seventy-five hundred 
19   dollar category.  But it may be something that, if 
20   necessary, we can point to if the idea of progressive 
21   bingo game does come in front of the legislature 
22   again, we can point to this -- hopefully we can point 
23   to it with some success.
24                 MS. JOSEPH:  I guess my question would 
25   be:  Would you like to combine those two groups?  
0024
 1                 CHAIRPERSON TAYLOR:  Is that something 
 2   we need to have a motion from the BAC for or the two 
 3   groups can agree on that?  
 4                 MR. ATKINS:  I don't think you need a 
 5   formal motion and vote.  I think if the group just 
 6   through a consensus can agree to it.
 7                 CHAIRPERSON TAYLOR:  So groups, do you 
 8   want to combine?  
 9                 MS. LOPEZ:  Sure.
10                 CHAIRPERSON TAYLOR:  And -- and how 
11   many does that make on a group then or if it's on the 
12   list, who's on the groups?
13                 MS. JOSEPH:  I'm not sure of who all 
14   was on Danny's group just off the top of my head.  
15   I'm --
16                 MR. MOORE:  I think Suzanne was on 
17   there.
18                 MS. JOSEPH:  Okay.
19                 CHAIRPERSON TAYLOR:  I don't know if I 
20   was on Danny's, but I'm just worrying that it might 
21   make too many total numbers so it would be a quorum so 
22   that's why I'm kind of saying we might need to -- 
23                 MS. JOSEPH:  Rosily, Mario, Danny.
24                 CHAIRPERSON TAYLOR:  I'll remove 
25   myself.
0025
 1                 MR. ATKINS:  I see Shane Woodard in the 
 2   audience.  Were you on the alternative style of bingo 
 3   play work group?  
 4                 MR. WOODARD:  (Nods head.)
 5                 MR. ATKINS:  He's indicated that he 
 6   was.  Do you recall who else was on that group?  
 7                 MR. WOODARD:  Jamie McNally, I think.  
 8   Was Fenoglio on there?  I think he was.
 9                 CHAIRPERSON TAYLOR:  Is having four 
10   members too many -- I mean, I know that -- 
11                 MS. JOSEPH:  Not -- not -- well, not 
12   necessarily.
13                 CHAIRPERSON TAYLOR:  Since there are 
14   only eight, would that make the 50 percent?  Or 
15   because there's supposed to be nine that's still -- 
16                 MS. JOSEPH:  Well, this isn't voting.
17                 CHAIRPERSON TAYLOR:  Okay.  As along as 
18   there is enough.
19                 MR. ATKINS:  What -- what Sandy could 
20   do is she could follow up with members of each -- 
21                 MS. JOSEPH:  We could --
22                 MR. ATKINS:  -- and look back and 
23   see --
24                 MS. JOSEPH:  -- I'll look back through 
25   the list provided and see how many we have for sure.  
0026
 1   I'd be happy to do that.
 2                 MR. ATKINS:  And make sure those 
 3   individuals can still serve.
 4                 CHAIRPERSON TAYLOR:  Okay.  So you were 
 5   going to go ahead and contact the individual members 
 6   and also the -- I mean, like Shane and Jamie and 
 7   Steve?  You were going to contact all those people?
 8                 MS. JOSEPH:  Right.  Anybody who had -- 
 9   originally had volunteered to be on either group.
10                 CHAIRPERSON TAYLOR:  Okay.  Okay.  That 
11   will work.
12                 MS. JOSEPH:  That's all I have for that 
13   item.
14                 CHAIRPERSON TAYLOR:  Public 
15   discussion -- we have -- is this -- I don't want to 
16   make you sit down if you were going to say something.
17                 MS. JOSEPH:  No, that's all right. I 
18   was just ready for the next item.
19                 CHAIRPERSON TAYLOR:  Okay.  Great.
20                 Knowles Cornwell.
21                 MR. CORNWELL:  Ladies and gentlemen, 
22   Knowles Cornwell.  Your work study group for 
23   alternative plays in progressive bingo.  I would like 
24   to add a person to that committee, if possible, 
25   Suzanne and committee members.
0027
 1                 Glenn Goulet is probably one of the 
 2   best game design and knowledgeable people in -- in the 
 3   gaming industry, former marketing manager for 
 4   Multimedia Games, has -- is willing to sit on the 
 5   committee with you guys and lend his expertise to 
 6   bingo and other games that are played in the United 
 7   States and foreign countries.  And I -- I think you 
 8   ought to consider letting Glen sit on the committee 
 9   with you if possible.
10                 CHAIRPERSON TAYLOR:  I would be glad to 
11   add Glenn's name on here if you will just spell his 
12   last name for me.
13                 MR. GOULET:  It's Glenn Goulet.  
14   G-o-u-l-e-t.
15                 CHAIRPERSON TAYLOR:  Okay.  We'll go 
16   ahead and add Glen Goulet to that committee.
17                 Sandy.
18                 Are there any other comments from the 
19   BAC members on these two items?
20                 MS. JOSEPH:  If you could get me some 
21   contact information later.
22                 MR. GOULET:  Certainly.
23                 MS. JOSEPH:  Thank you.
24                 CHAIRPERSON TAYLOR:  Item Number 6, 
25   report and possible discussion and/or action 
0028
 1   pertaining to the prize fixing work group.
 2                 Sandy.
 3                 MS. JOSEPH:  We've got a lot of 
 4   potential rule-making in the works as can you tell 
 5   from these reports.
 6                 The third one that I'm reporting on 
 7   today relates to the price fixing possible rule 
 8   amendment.  The work group did meet for several hours 
 9   at a time on at least two occasions.  We tossed around 
10   a lot of ideas, a lot of philosophy, et cetera.  Where 
11   we ended up is that I asked members of the work group 
12   if they would submit any suggestions or comments that 
13   they had on possible first draft of an attempt at a 
14   rule amendment or -- or a rule-making upon price 
15   fixing.  The deadline for that was January 30th.
16                 We received one comment or suggestion 
17   that was from Jamie McNally, and he had agreed during 
18   one of the meetings that he would take on trying to 
19   draft something pertaining to horizontal price 
20   fixing.  It would -- it seemed to be the consensus of 
21   the work group that horizontal price fixing was 
22   clearly prohibited by the statute.  This is my sense 
23   of what was said at the meeting.  So Jamie agreed that 
24   he would attempt to put something in the -- a draft 
25   rule language.
0029
 1                 I will be distributing that language to 
 2   members of the work group to see if other members have 
 3   any comment on that.
 4                 In addition, staff will begin to draft 
 5   a rule.  And after we have a draft, we will, again, go 
 6   back to the work group for comments and continue to 
 7   work through the process.
 8                 Are there any questions about that?  
 9                 CHAIRPERSON TAYLOR:  Yeah.  What is 
10   horizontal price fixing?  
11                 MS. JOSEPH:  Horizontal would be like 
12   manufacturers working with other manufacturers, in 
13   other words, the same level, on a horizontal basis to 
14   fix prices.  Vertical price fixing would be more the 
15   manufacturer with the distributor down -- down the 
16   chain, so to speak.
17                 CHAIRPERSON TAYLOR:  Any other 
18   questions?
19                 And who -- who was on the work group 
20   again?  
21                 MS. JOSEPH:  I didn't bring my list.  
22   Yeah.  If some folks can help me remember.  Rosily, 
23   Danny.
24                 MR. MOORE:  Yeah.
25                 MS. JOSEPH:  Larry, but he wasn't able 
0030
 1   to participate because of other personal issues that 
 2   came up for him.  We also had Steve Bresnen, Stephen 
 3   Fenoglio, Jamie McNally.
 4                 MR. WHITTINGTON:  Jane Thompson.
 5                 MS. JOSEPH:  Do y'all remember anybody 
 6   else?
 7                 Who?
 8                 MR. ATKINS:  Jane Thompson.
 9                 MS. JOSEPH:  Yes, Jane Thompson.  And 
10   Jane Thompson did send me an e-mail last week saying 
11   that she wanted to withdraw from the group because of 
12   other demands of her time, but she does participate in 
13   our meetings.
14                 CHAIRPERSON TAYLOR:  And also Trace 
15   Gray.
16                 MS. JOSEPH:  Trace Gray also, but he 
17   was not able to make our meeting, but he stays on our 
18   work group.  Mostly there are -- well, in case you 
19   know where are meetings are actually.  There are some 
20   people who actually attend our meetings and then 
21   others who participate by telephone conference.
22                 MR. ATKINS:  And has that been working 
23   out, Sandy?  
24                 MS. JOSEPH:  Yes.  Uh-huh.  Yes, it 
25   has.  You lose something when you are not able to look 
0031
 1   somebody in the eye and kind of, you know, communicate 
 2   other ways than just verbally.  Yeah, but it works 
 3   well.
 4                 Any other questions for me?  We will 
 5   report back as we move along on all of these.
 6                 CHAIRPERSON TAYLOR:  Thank you.
 7                 Item number 7.  Oh, wait.  I'm sorry.  
 8   We did have public comment on that.  Steve Bresnen.
 9                 MR. BRESNEN:  Thank you.  My name is 
10   Steve Bresnen.  I'm here on behalf of the Bingo 
11   Interest group.  I want to say thanks first to Sandy 
12   Joseph for doing that little job in keeping us on 
13   track when we discuss these very difficult issues.
14                 And, Sandy, when I get Jamie's draft, 
15   I've got some specific language that I will tailor to 
16   go with it.
17                 MS. JOSEPH:  Good.
18                 MR. BRESNEN:  And the language that, I 
19   think, needs to go with it, we need to be careful not 
20   to interfere with conduct that can result in a lower 
21   price for charities, what they pay for their -- to the 
22   supplies that they purchase from distributors and 
23   indirectly from manufacturers.
24                 I want to be certain that the -- in the 
25   normal course of business a distributor can discuss 
0032
 1   with a manufacturer the price that the manufacturer 
 2   charges the distributor.  When a charity or a group of 
 3   charities approaches the distributor to obtain a lower 
 4   price and the distributor, knowing that they are going 
 5   to have to cut their margin in order to meet that 
 6   price, adjust their relationship back up the stream 
 7   with the manufacturer in order to do something that 
 8   makes economic sense and is also beneficial to the end 
 9   customer.
10                 I think if we draw the noose too tight 
11   on this, we are going on the -- particularly on the 
12   vertical.  Everything I am talking about here is on 
13   the vertical chain.  Then I think we are going to 
14   squelch behavior that's ultimately beneficial to the 
15   charities; and I don't think by any stretch of the 
16   imagination, the statute was intended to drive the 
17   price up for the charities to pay for products.  I 
18   think the entire legislative history of the Bingo 
19   Enabling Act and, you know, the things that we've 
20   thought about here and the legislature and the Sunset 
21   Commission, all of that has been about trying to see 
22   that the charities make a reasonable return for their 
23   efforts and to be anything less than very careful and 
24   to state specifically in the rule that that kind of 
25   conduct that I've described is okay and not a 
0033
 1   violation would be throwing the baby out with the bath 
 2   water.
 3                 Having said that, I do think that you 
 4   can have a situation where a manufacturer and 
 5   distributor, in essence, price a product so low that 
 6   it drivers other manufacturers and distributors out of 
 7   the marketplace, what's known as predatory pricing 
 8   in -- in the world out there.  So I think the rule has 
 9   to clearly delineate that predatory pricing can't be 
10   engaged in because that ultimately adds to higher 
11   prices for the charities and an unfair competitive 
12   situation.  And we have some manufacturers that have 
13   enough help to be able to wreak havoc on the 
14   marketplace out there.  But at the same time I think 
15   we have to avoid people horizontally, a few 
16   manufacturers setting the price so they protect 
17   themselves or keep other players out of the market and 
18   engage in anti-competitive behavior.
19                 So I'll be trying to come up with some 
20   language that captures what I believe would be 
21   consistent with statutory intent and it has the effect 
22   of driving the price lower for the charities.
23                 Yes, sir?  
24                 MR. WHITTINGTON:  Would there be a 
25   minimum price that they can go over or max?  I mean, 
0034
 1   because if you say a manufacturer might go down too 
 2   low and be -- and just price -- price everything out 
 3   of the market, would there be a minimum price that the 
 4   manufacturers would charge?
 5                 MR. BRESNEN:  I wouldn't envision it 
 6   that way because I don't know of any way to get to 
 7   that to reach that price.  I think it's a question of 
 8   fact.  I mean, you -- you would have to take the 
 9   behavior over a period of time and know a lot about 
10   the market conditions and see other people fleeing the 
11   marketplace or complaining that somebody is pricing 
12   below cost, for example.  Usually predatory pricing 
13   involves pricing below cost.
14                 MR. WHITTINGTON:  So what is cost?
15                 MR. BRESNEN:  Yeah.  Doing -- pardon 
16   me?
17                 MR. WHITTINGTON:  I'm asking what's 
18   cost?
19                 MR. BRESNEN:  Well, you could probably 
20   drive that a lot better than you could figure out 
21   what's like a reasonable price in the marketplace.  
22   Cost can certainly be determined.  I mean, you look at 
23   their books and determine that.  You know, the -- what 
24   supply and demand is doing in the market to set a 
25   price I don't know that you would ever get there.
0035
 1                 I -- I met the chairman when I was 
 2   working on de-reging on the trucking industry with 
 3   Governor Bullock, and we fought those battles year 
 4   after year to trying to get to this -- a pricing 
 5   regimen.  And I just don't -- I think the government 
 6   is a very poor price setter, but I do think you can 
 7   rules in place that if the totality of the 
 8   circumstances shows that somebody engaged in predatory 
 9   conduct, that you can then punish them.  But it's a 
10   hard case to make.  It's a real hard case to make.  
11   That's why phone companies and electric companies and 
12   other people have been -- I mean, as they have been 
13   deregulated, it's been done very carefully over the 
14   years.
15                 Yes, sir?  
16                 MR. WEEKLEY:  Will this reduce 
17   competition among your manufacturers or distributors?
18                 MR. BRESNEN:  Well, it shouldn't if 
19   it's done right.  I mean, I'm a -- I've been a 
20   vocal -- very vocal proponent -- 
21                 MR. WEEKLEY:  Of competition.
22                 MR. BRESNEN:  -- of competition.  And 
23   as we've tried to produce new games, get the 
24   legislature to authorize new game, we had provisions 
25   to say you can't -- the first guy doesn't get into the 
0036
 1   market until everybody gets into the market at once 
 2   and that sort of thing.
 3                 So what I have in mind, I think, would 
 4   facilitate competitive behavior because it allows 
 5   people to talk amongst themselves about what their 
 6   relationship is.  Basically I -- the way I envision 
 7   it, anyway, is the distributor is going to have to 
 8   say, you know, your price is too high manufacturer 
 9   because in order to get this customer, I have got to 
10   meet the price that my competitor is charging out 
11   there.  And if I do that, then I'm not going to have 
12   enough margin to make my business go.  And so that's 
13   what I have in mind, that sort of give and take.
14                 MR. WEEKLEY:  Would it reduce the 
15   possibility of loss leaders?  
16                 MR. BRESNEN:  I don't think so.  I 
17   don't think so.  I think you can use loss 
18   leaders with -- for example, I mean, you know, 
19   Wal-Mart uses loss leaders all the time.
20                 MR. WEEKLEY:  We all do.
21                 MR. BRESNEN:  Right.  But it didn't -- 
22   it doesn't put Target out of business.  But if -- but 
23   if Wal-Mart engaged its entire, you know, 5,000 items 
24   or 100,000 items in its inventory was a loss leader, 
25   it would probably inflict a pretty heavy cost on 
0037
 1   Target, right?  
 2                 MR. WEEKLEY:  And its the greed you're 
 3   talking about.
 4                 MR. BRESNEN:  Yes, sir.  Sure.  Yeah, 
 5   that's what I answering Larry on.  I don't think you 
 6   can set a hard and fast number.  As a rule, I think 
 7   you have to have a legal basis for the commission to 
 8   act against predatory pricing but not have it -- 
 9   frankly, they don't come up very -- they won't come up 
10   very much, if at all.  But I think you have to have it 
11   there; otherwise, you are just disarmed, and everybody 
12   is at the mercy of some -- of a mad guy.
13                 Yes, sir?  
14                 MR. WHITTINGTON:  If it's high or low?  
15   If the manufacturer and distributor set a price, 
16   not -- and fixed it at that price, isn't that price 
17   fixing no matter what it is?  
18                 MR. BRESNEN:  If the manufacturer -- 
19   well, the -- the -- this is the difficulty in this 
20   statute.  If the manufacturer talks to his competitor 
21   and fixes the price to where people are paying a 
22   higher price than they would if there was competition, 
23   that's clearly the kind of price fixing I think that 
24   the statute was -- I don't think anybody disagrees 
25   that that's the kind of price fixing that effects the 
0038
 1   statute.
 2                 If through the normal course of 
 3   business a manufacturer and distributor adjusts the 
 4   margins as between them in order to facilitate the 
 5   distributor making a price to the charity, then I 
 6   don't consider that -- I would not consider that to be 
 7   price fixing.  A price -- certainly a price results 
 8   from it.  There's no doubt about that.  But it's also 
 9   to the benefit of the charity that can command that 
10   price.  
11                 MR. WHITTINGTON:  What if the 
12   manufacturer set it too low?  It's going to based on 
13   what's there now because the charity is going to get a 
14   low price.  Is that basically -- is that price fixing 
15   too?
16                 MR. BRESNEN:  Well, if a manufacturer 
17   charged a price to the -- let me see if I can follow 
18   you.  If the manufacturer sets a very low price to the 
19   distributor.
20                 MR. WHITTINGTON:  Right.
21                 MR. BRESNEN:  Such that there is no 
22   room for the distributor -- 
23                 MR. WHITTINGTON:  Right.
24                 MR. BRESNEN:  -- to -- I don't -- I 
25   don't know.  If it resulted in no margin for the 
0039
 1   distributor, such that the distributor was a straw 
 2   man, then I would say that's probably not a good -- 
 3   that's certainly not what the statute contemplates 
 4   because it has manufacturers and distributors because 
 5   they can play real roles in it.  I don't know if you 
 6   can -- I don't know if that would happen, but 
 7   conceptually I would think that's not consistent with 
 8   the three-tiered system that's this statute.  I hope I 
 9   answered that right.
10                 Thanks a lot for letting me talk.
11                 CHAIRPERSON TAYLOR:  Thank you.  Is 
12   there any other discussion?  
13                 MR. FENOGLIO:  Madam Chair.
14                 CHAIRPERSON TAYLOR:  Yes.
15                 MR. FENOGLIO:  Sorry.  I --
16                 CHAIRPERSON TAYLOR:  Steve.
17                 MR. FENOGLIO:  My name is Stephen 
18   Fenoglio.  I had a family emergency this morning, so I 
19   apologize for being late.  Someone brought me up to 
20   speed on what the discussion topic is, and I would 
21   like to lay out a few items on this matter.
22                 And I'm giving you, Madam Chair, my 
23   witness affirmation and several documents and I 
24   know -- I'm assuming this is a moving target on the 
25   issue.
0040
 1                 The first document I'm handing out -- 
 2   and I had asked for a copy of what is in the notebook, 
 3   and I was told there was nothing in there on this 
 4   issue -- is a copy -- I brought 15 copies, Madam 
 5   Chair -- of what the statute is on prohibitive price 
 6   fixing.  The next document is a two-page memo that I 
 7   sent Ms. Joseph on November 29 and Ms. Joseph's memo 
 8   back to me.  I'm a member of the work group on this 
 9   issue.
10                 This isn't the first time that I've 
11   commented on this issue at the commission.  There's a 
12   lot of discussion in the business world and in the 
13   political world about the transparency of -- and I'm 
14   sorry, Ms. Joseph, I did bring copies for you but...  
15   Sandy has seen everything that is being circulated, 
16   Sandy Joseph.
17                 There is a lot of discussion about the 
18   transparency of issue and in sum and substance what 
19   that -- what that means is that everyone is on the 
20   same page.  Everyone has the same information so they 
21   can make decisions based upon their unique set of 
22   circumstances.  I think the process we have is flawed 
23   because there's only one party to the rule-making 
24   process that has the -- well, I guess maybe two 
25   parties that has the information that gives -- that 
0041
 1   leads us to where we are today.  And where we are 
 2   today is obviously there was a investigative complaint 
 3   issue and a exhaustive discussion and termination by 
 4   the staff that led to the filing of a price fixing 
 5   complaint against a manufacturer that led to -- I'm 
 6   assuming -- intense negotiations resulting in a 
 7   quarter of a million-dollar fine that the commission 
 8   adopted.  And that brought us to the process of should 
 9   there be a rule.
10                 Well, I'll grant you that the area of 
11   price fixing is extremely complicated and only a few 
12   lawyers in the city of Austin, or perhaps the state, 
13   really understand it, on either a Federal law level or 
14   a Texas law level.  And then transplanted into that is 
15   the Bingo Enabling Act provision that I handed out, 
16   which is two sets, separate subparagraphs, and it's 
17   different regulatory prohibition than what's contained 
18   in either Federal price fixing prohibitions or very, 
19   very similar state price fixing prohibitions.  So you 
20   have a traditional Federal analysis, and then you have 
21   the Bingo Enabling Act that applies to bingo.
22                 Well, my analysis -- and I think I've 
23   served with almost everyone on the rules on the BAC on 
24   different rules.  What I've always tried to start from 
25   is what are the underlying facts and what's the 
0042
 1   underlying law that leads us to the conclusion that we 
 2   need a rule because I'm not one that says let's go 
 3   ahead and write a rule if there is no perceived harm.  
 4   And even if there is a perceived harm, I would like 
 5   and I think most of the BAC members would like to 
 6   understand what the facts are that lead you to 
 7   conclude you need a rule.
 8                 And the only two people who know the 
 9   facts are the commission staff.  And you see 
10   Ms. Joseph's response to my memo, not trying to rehash 
11   a settled case but trying to understand the basic 
12   facts.  And the staff's response is we're not going to 
13   tell you -- I'm paraphrasing -- it's subject to open 
14   records.
15                 Well, I filed a number of open records, 
16   but I have yet to see all of the stuff that was in 
17   that GameTech file and I have yet to request it.  In 
18   the first meeting, each of the subcommittee members 
19   shouldn't have to learn from the staff what's in the 
20   staff's analysis if the staff has it.  And, again, I'm 
21   not trying to regurgitate or reargue a settled case, 
22   but if the basis is reached in part to settle a case, 
23   is the issue that the commission has very recent, the 
24   division ought to be able and the staff ought to be 
25   able to tell us what those basic facts are that lead 
0043
 1   the staff to conclude that perhaps a rule is 
 2   necessary.  And I think Mr. Atkins testified to that 
 3   extent in the legislature.
 4                 And that's why I'm reluctant to try to 
 5   propose much language until I know what those 
 6   transparent, quote, unquote, facts are.  And for the 
 7   life of me I can't figure out why we can't get to 
 8   everyone on the same factual basis so that we can move 
 9   forward and have an intelligent discourse.  I 
10   understand why Mr. McNally with the law firm of Clark, 
11   Thomas & Winters has proposed the new language.  He 
12   represented GameTech.  I bet you he still does.  He 
13   may have a particular ax to grind.
14                 But until I'm on the same page as far 
15   as the factual basis, then I understand the GameTech 
16   documents, quote, unquote, are boxes and boxes and 
17   boxes of documents.  And I don't think my charitable 
18   organization is wanting to pay me to go through any of 
19   the thousands of pages of documents particularly if 
20   there is a staff person who has seen them and I'm 
21   assuming there are or else they wouldn't have settled, 
22   then they would be aware of what some of those basic 
23   facts are.
24                 I did bring a draft rule on price 
25   fixing.  It's five lines long, and I will circulate 
0044
 1   that in just a moment.  But it only regurgitates what 
 2   the law is today, and I think we lawyers at least know 
 3   and anyone who has read the two attorney general's 
 4   opinions knows what the attorney general has already 
 5   ruled what the law is and that's the lawyer for the 
 6   Lottery Commission, so I think they are probably bound 
 7   by their lawyer's opinions.
 8                 And if anyone wants copies, I did bring 
 9   copies of those attorney general opinions with me.  I 
10   don't know that I brought enough but I can certainly 
11   get them.  For the record, it's opinion number JC-0296 
12   issued by John Cornyn October 17th, 2000, and opinion 
13   number JC-0450 issued January 14, 2002.
14                 So my sense is, based on what I've read 
15   in newspapers and basically what I've heard in this 
16   room with discussions between commissioners and staff 
17   and some of the documents that have crossed my fax 
18   machine, that there may be a need for a rule.  
19   Ultimately obviously the charities are going to pay if 
20   there is prohibitive price fixing.  If a manufacturer 
21   and distributor conspire and trade price data to 
22   establish a price that may not be a truly market 
23   competitive price -- and I think we both -- all of us 
24   know if that's going on, they're not trying to price 
25   it too cheap but trying to price it higher.  And the 
0045
 1   charities are the ones that are paying the freight on 
 2   that, to follow up on a comment from Mr. Bresnen on 
 3   the trucking de-reg.
 4                 But I don't think anyone on the 
 5   subcommittee other than the staff and Jamie McNally 
 6   have knowledge of what's gone on about what clearly 
 7   was a harm.  Mr. Atkins testified that, you know, 
 8   there were several hundreds of thousands of dollars, 
 9   testified at the commission and, I believe, at the 
10   legislature on this issue, that charities have been 
11   overcharged.  So it's not a -- a trivial matter.  But 
12   until everyone knows what the same facts are, it's 
13   hard for me to say I know exactly what a proposed rule 
14   that digs into the details of 2001.556, subparagraph 
15   (a) and (b) then comes forth with a rule that a 
16   salesperson, who is not an attorney or a distributor 
17   or a manufacturer and the charity who's obviously not 
18   an attorney either, a charity rep, can look at it and 
19   say, oh, I got it.  I understand.
20                 Now, mister -- if it's a charity 
21   talking to the distributor rep salesperson, this price 
22   you're quoting, now, okay, I got you, and what you're 
23   telling me is you haven't set that price with your 
24   manufacturer, et cetera.  I don't think we are at that 
25   point yet.
0046
 1                 And I'll be happy to answer your 
 2   questions.  And while I'm doing it, I will circulate 
 3   the proposed draft rule on price fixing, which again I 
 4   believe merely restates what the statute is, which I 
 5   never as a lawyer -- if you have a statute that's 
 6   clear, why do you need a rule that's any clearer.  I 
 7   don't think if does anyone any good to just have a 
 8   rule that merely regurgitates what a statute says.
 9                 So I'd be happy to answer any 
10   questions.  Thank you, Madam Chair.  I know I gave 
11   y'all a lot of grief on this issue.
12                 CHAIRPERSON TAYLOR:  Are there any 
13   questions for Stephen Fenoglio by the committee?  
14                 MR. FENOGLIO:  Thanks.
15                 CHAIRPERSON TAYLOR:  Thank you.
16                 Any other comment on this subject?  
17                 Then I guess the committee will 
18   continue to meet and come forward with a proposed rule 
19   to the BAC.
20                 Item Number 7 report and possible 
21   discussion and/or action on third quarter 2005 bingo 
22   statistics.  And Billy Atkins was going to tell us 
23   about this.  
24                 MR. ATKINS:  Thank you -- thank you, 
25   Madam Chairman.
0047
 1                 Phil Sanderson is going to be giving 
 2   the presentation, but what I did want to do real 
 3   quickly is draw your attention to the cover letter 
 4   that's included with this item.  Specifically, this 
 5   item has been provided to our commissioners also at 
 6   their commission meeting.  And as a result of the 
 7   presentation that was both given to the BAC and to the 
 8   commission, on the second quarter 2005 figure as well 
 9   as third quarter 2005 figures, Commissioner Cox has 
10   raised an issue as it relates to the fact that 
11   reported figures over a period of time have shown a 
12   continued decline in the number of organizations 
13   conducting bingo as well as declines in the number of 
14   bingo occasions held, as well as decline in 
15   attendance.  However, we're seeing an increase in 
16   gross receipts.
17                 So what I did was I copied from -- I 
18   believe, that that quote is from the September 28th, 
19   2005, commission meeting where Commissioner Cox is 
20   asking specifically for input from the bingo advisory 
21   committee based on this situation, continued decline 
22   in organizations, conducting, number of occasions 
23   held, decline in attendance but a increase in gross 
24   receipts.  But it's Commissioner Cox's position, I 
25   think -- and I think we can all agree he has some 
0048
 1   pretty significant experience in the gaming area -- 
 2   that that's not an overall healthy situation, really, 
 3   for any kind of industry.
 4                 So what he has done in his statement is 
 5   he has asked for three things, and I think that the 
 6   committee may want to spend some time discussing that 
 7   after Phil's presentation.  And it may be something 
 8   that Suzanne can provide in their report to the 
 9   commission at their meeting on the 27th.
10                 But, first of all, he's asking for the 
11   reaction of the industry to that fact.  You know, he's 
12   interested if there is any type of concern.  And 
13   finally he would be interested in any type of plan to 
14   address those concerns.  So I wanted to put that 
15   information out there so you would have the benefit of 
16   it as Phil goes through his presentation.
17                 MR. SANDERSON:  Thank you, Billy.
18                 Madam Chair, members, my name is Phil 
19   Sanderson, assistant director of the Charitable Bingo 
20   Operations Division.  And I'm here to present to you 
21   the first quarter financial information as reported by 
22   the licensed authorized organizations.  This is the 
23   same report that we gave to the commissioners at their 
24   January 13th meeting.
25                 As previously presented by the members 
0049
 1   of the Office of the Controller, this analysis covers 
 2   the years 2000 through 2005 for gross receipts, 
 3   prizes, net revenue, expenses, and reported charitable 
 4   distributions.  Further analysis has been completed on 
 5   the quarterly trends for gross receipts, attendance, 
 6   occasions, and the conductor's reporting.
 7                 As shown in this graph, gross receipts 
 8   for any given year are the highest in the first 
 9   quarter.  The gross receipts for the first three 
10   quarters of 2005 are the highest for each quarter of 
11   this five-year period and gross receipts are on track 
12   to be the highest during this five-year period, in 
13   fact, the highest since 1995.
14                 We should have the final numbers for 
15   2005 and the fourth quarter of 2005 on February the 
16   22nd, and we'll start analyzing those.  Right now we 
17   are expecting gross receipts to exceed $630 million.
18                 Attendance is also the highest in the 
19   first quarter of each year; however, unlike gross 
20   receipts, 2005 will be the lowest reported attendance 
21   during this five-year period.  The average amount 
22   spent by the player has been continually increasing 
23   during this five-year period.  Like gross receipts and 
24   attendance the average number of players per occasion 
25   is the highest in the first quarter of each year 
0050
 1   during that five-year period.
 2                 The number of occasions has been 
 3   decreasing relatively each quarter over the past five 
 4   years.  For this particular year the first three 
 5   quarters remain constant, then there is a drop in the 
 6   fourth quarter.  The number of occasions per 
 7   conductors remain fairly constant each quarter with 
 8   the first quarter also being the highest.  You'll see 
 9   that the number of conductors reporting tends to 
10   increase each quarter throughout each year, but it is 
11   decreasing year to year.
12                 Now, if you'll look in your notebook, 
13   this information that I'm providing is part of the 
14   packet that was in your notebook.  To get to the 
15   specific information that was reported for the third 
16   quarter of 2005, as you can see, gross receipts were 
17   reported to be 155,000,000; prizes, 117,000,000 or 75 
18   percent of gross receipts.  Adjusted gross receipts 
19   were 30.7 million.  And net revenue for the quarter of 
20   6.4 million or 4.1 percent of gross receipts.  The 
21   amount that was required to be distributed during the 
22   fourth quarter was 6.1 million while actual reported 
23   distributions totaled 7.4 million.
24                 Now comparing the third quarter of 2005 
25   to the third quarter of each of the preceding years, 
0051
 1   gross receipts are up 9.5 percent over the third 
 2   quarter of 2001.  Prizes are up 15.8 percent; however, 
 3   adjusted gross receipts are down 5.2 percent.  And 
 4   that revenue is down 1.8 million or 25.76 percent.  
 5   Charitable distributions are down 7.62 percent.  Prize 
 6   pay outs for regular bingo reached 76.2 percent in the 
 7   third quarter of 2005, which is the highest since 
 8   1996.  The prize pay out percentage for Instant Bingo 
 9   was 73.5 percent, which is the highest ever for a 
10   particular quarter.
11                 Here's a chart that indicates 
12   disbursements other than prizes as a percentage of 
13   gross receipts.  Highest being rent payments of 7.2 
14   percent; salaries for callers, cashiers, and ushers of 
15   5.8 percent; distributions at 4.7 percent; lease 
16   payments to distributors of 3.2 percent; while the 
17   remainder of the other expenses were all under 2 
18   percent each.
19                 This pie chart is a graphical imitation 
20   of what percent each expense is as it relates to the 
21   total expenses, once again not including prize 
22   pay outs.  Salaries for janitorial, callers, cashiers, 
23   ushers, security, legal, and accounting, was down for 
24   more than 50 percent of the total expenses.  When you 
25   include rent payments the amount represents over 92 
0052
 1   percent of total expenses.
 2                 That concludes this presentation, and I 
 3   believe there are some additional graphs in your -- in 
 4   your notebook.  And I'm available to answer any 
 5   question that you may have about this presentation or 
 6   any of the graphs in your notebook.  Thank you.
 7                 MS. TAYLOR:  Any comments by the 
 8   committee?  
 9                 MS. LOPEZ:  I have a question.
10                 When we look at gross receipts -- in 
11   fact, when nonprofit organizations are in the 
12   charitable bingo industry, what's important to us is 
13   net profit, not gross receipts.  Gross receipts, you 
14   take into consideration all of the prize fees that are 
15   paid out and all of the expenditures.  At the end the 
16   nonprofit organization is actually looking for a net 
17   profit or a net proceed.
18                 We see a decrease of, what, 25 percent 
19   just in quarters of net profit for the year.  I think 
20   that the questions that Mr. Cox has addressed here are 
21   important questions because we see that there is a big 
22   change in the bingo industry, and there's numerous 
23   factors that have contributed to that being the change 
24   in the industry.
25                 I think that we need to look at 
0053
 1   something.  For example, I'm looking here at the 
 2   amount of calculations that were allocated to local 
 3   jurisdictions in the third quarter.  When I look at -- 
 4   particularly in Ector County and Odessa, they raked in 
 5   over $88,000 in allocations.  But I can assure you 
 6   that our charities in Ector County and Odessa did not 
 7   have $88,000 worth of distributions to our 
 8   organization.  So something is wrong here.  The 
 9   picture is wrong.  I mean, I'm just looking at it as 
10   far as the proceeds are being identified in our 
11   statewide report.  Those are my comments.
12                 MR. ATKINS:  I guess, I'm -- I'm not 
13   sure I follow.  I'm -- I'm just not sure I follow what 
14   you're --
15                 MS. LOPEZ:  I guess my question is when 
16   we get, you know, reports that tell us that obviously 
17   bingo is a shrinking industry because we all know 
18   that, that there is a problem here.  We know that 
19   there are several issues of why there are problems 
20   with the industry.  We need to, I think, as a whole 
21   figure out what we need to do to fix some of those 
22   problems so that bingo can remain as a charitable 
23   organization's fundraising mechanism.  Because at this 
24   point, I think that there is a lot of -- there is 
25   decrease in charities being involved in bingo.
0054
 1                 There are many reasons for that.  It 
 2   could be because there are not as many organizations 
 3   that have funding to be able to get started in bingo; 
 4   rules and regulations that organizations have to 
 5   follow that sometimes are very, you know, cumbersome 
 6   for some organizations to over -- you know, to take on 
 7   these responsibilities.
 8                 Expenses.  Again, I'm just speaking on 
 9   the charities in our particular county that we have -- 
10   you know, we face just an immense amount of 
11   expenditures that it takes an immense amount of time 
12   to be able to increase those revenues and so I think 
13   that we, as the Texas Lottery Commission and the Bingo 
14   Advisory Commission, need to really look at -- a hard 
15   look at a plan of what needs to be done at the 
16   statewide level to help really increase some of our 
17   net profits for the organizations.
18                 MR. ATKINS:  Well, and I think that's 
19   part of what's -- what's driving the questions that 
20   Commissioner Cox was asking.  And I don't know that 
21   Commissioner Cox automatically feels that it's the 
22   state's responsibility.  If -- you know, his response 
23   may be -- and I am, you know, not speaking for him, 
24   but I think it's in part, these aren't games that the 
25   Lottery Commission operates.  They are games that -- 
0055
 1   that individual organizations operate.
 2                 And I want to go back because I think 
 3   you made a good point when you were talking about the 
 4   net revenue.  And if you look, you know, particularly 
 5   on this chart, where we are comparing third quarters, 
 6   that's one of the things that we started to do in all 
 7   the information that we put together; and that is to 
 8   identify the adjusted gross where we are taking out 
 9   the prize payments as well as the -- we're taking 
10   something out, Phil.
11                 MR. SANDERSON:  Lease payments.
12                 MR. ATKINS:  Expenses?
13                 MR. SANDERSON:  Lease payments.
14                 MR. ATKINS:  Lease payments.  So that's 
15   given us an adjusted gross figure.  If you look again 
16   on the chart that's showing third quarter comparison, 
17   you are seeing that, again, even that figure is 
18   remaining pretty stagnant while we are experiencing 
19   some pretty significant increases in total gross.  And 
20   so, you know, it's just starting to beg the question, 
21   you know, why should there be a desire to increase 
22   gross receipts even more because it doesn't seem -- it 
23   doesn't appear to be showing up at that net level and 
24   resulting also in terms of what's going to charitable 
25   distributions.
0056
 1                 For example, the last time gross 
 2   receipts were $633 million was in 1994.  But that year 
 3   charitable distributions were almost $49 million, 
 4   about, you know, $19 million higher than they'll 
 5   probably be in 2005.
 6                 MR. WHITTINGTON:  Well, my take on that 
 7   is that, number one, is the reason why the gross is so 
 8   much higher is because of the bin tickets.  You don't 
 9   make as much with the bin tickets as you did the old 
10   pull-tabs, number one.  The computer and the card-
11   minders has gone crazy.  People are playing more with 
12   computers now than paper as compared to '99 and now.  
13   And that's a big difference because paper wasn't as 
14   much, and the charities made more on -- on the net 
15   level because of paper versus computer.
16                 Now, when you get computers, you've got 
17   the manufacturer, you've got the distributor, and 
18   everything is paid from that.  So that makes the net a 
19   lot less now compared to '95.  Okay.  The gross is 
20   going to always be higher.  The more pull-tabs we 
21   sell, the less net we get.  They still got to pay 
22   taxes on the pull-tabs; so, taxes are higher.  More 
23   taxes are coming in because of higher pull-tab sales.  
24   You've got to consider this stuff.  That's -- there's 
25   no other cause in my mind.  It's kicking the -- the 
0057
 1   average player that used to go in and play for $15, 
 2   now they buy a computer for 25.  So -- so the average 
 3   is -- it's almost double because of computers.  More 
 4   people play with computers than paper now.
 5                 So they're bringing the net down.  
 6   Pay out is more higher, and the gross is higher.  The 
 7   next one isn't any more because so much is taken from 
 8   that net.  And the pull-tabs net is lower than what it 
 9   used to be.
10                 CHAIRPERSON TAYLOR:  Let me go 
11   back to -- let me go back and -- so I have something 
12   when I go to the commission meeting, I would like to 
13   get the reaction.  Let me just physically as, what is 
14   our reaction, what is our reaction of industry to 
15   this.  So let me just get you to think -- I mean, and 
16   I'll start this by saying the reaction -- my reaction 
17   is we've been talking about this for years.  And we've 
18   watched the pattern.  It's a continuing problem that 
19   we are all aware of and that we've been discussing for 
20   a long time is that bingo has had a downfall since the 
21   Lottery Commission opened.
22                 Ever since they started the lottery, 
23   we've watched bingo go down.  And ever since we've 
24   seen the increase in gaming, we've watched bingo 
25   really go down.  And that's my reaction, but I would 
0058
 1   like to get the reaction from the rest of the 
 2   committee so I can put this in a report to the 
 3   Commissioners.
 4                 MR. ATKINS:  Well, can I -- can I 
 5   respond to that --
 6                 CHAIRPERSON TAYLOR:  Sure.  Yeah.
 7                 MR. ATKINS:  -- before you get your 
 8   reaction.  When you say bingo revenue going down, what 
 9   are you referring to, the bingo revenue -- 
10                 CHAIRPERSON TAYLOR:  Net.
11                 MR. ATKINS:  -- going down.
12                 CHAIRPERSON TAYLOR:  The net.  The 
13   net -- the distribution going down.
14                 MR. ATKINS:  So basically distribution 
15   going --
16                 CHAIRPERSON TAYLOR:  The distribution, 
17   the actual the bottom line.
18                 MR. ATKINS:  Okay.  So because again 
19   you're going to see other factors that are increasing.
20                 CHAIRPERSON TAYLOR:  Oh, absolutely.
21                 MR. ATKINS:  That was all pre-lottery.
22                 CHAIRPERSON TAYLOR:  Absolutely.  I 
23   didn't -- yeah.  I watched the net so --
24                 MR. ATKINS:  Yeah.
25                 CHAIRPERSON TAYLOR:  Yeah.  So let me 
0059
 1   just get some reaction from you-all so I can put this 
 2   in a report.
 3                 MS. LOPEZ:  And I have a question, you 
 4   know, in reference to Mr. Atkins.
 5                 You say this is not a state operated -- 
 6   approved -- well, it is approved, obviously the bingo 
 7   games that we conduct are bingo so...  But, in 
 8   essence, it's again the charity's responsibility, it's 
 9   our business, are we like basically a standalone?  
10   We've got to fight tooth and nail for everything we 
11   can do to make our business responsible throughout the 
12   state without having any kind of support system or a 
13   system, other than being governed by rules and 
14   regulations, again, dealing with, you know, the 
15   different industries that we need to deal with, which 
16   is the lessors and the manufacturers and 
17   distributors?  We are all in this together.  Everybody 
18   is in business.
19                 So I guess that's what I'm trying to 
20   find out, what is it that we as a collective unit can 
21   do to help either make this business more successful 
22   or keep it at least at the level that it's at where it 
23   does not compete with a creep and at some point  maybe 
24   nonexistent.
25                 MR. ATKINS:  Okay.  Let me -- that's a 
0060
 1   good question.  Let me try and -- and answer it, and 
 2   since -- since you are relatively new to -- to the 
 3   BAC, I'll just, you know, let you know that this is me 
 4   answering it again.
 5                 At its most base level, yes, the 
 6   responsibility of this commission is to regulate 
 7   bingo.  It's not to promote bingo.  It's not to 
 8   promote bingo the way the lottery promotes the 
 9   lottery.  The lottery is a product that the Lottery 
10   Commission creates, they market, they go out there, 
11   and, you know, they try and get every dollar they can 
12   without unduly influencing players, and that's their 
13   charge under state law to do that.
14                 The charge under state law for bingo is 
15   for the bingo division to regulate bingo.  That's 
16   why -- and, you know, this is -- Suzanne can attest to 
17   the fact, yeah, this is an issue that's been raised 
18   since the first advisory committee came along.  There 
19   has been a assumption in the bingo industry for some 
20   reason that no one quite seems to understand that the 
21   Lottery Commission is supposed to be advertising bingo 
22   games.  That's not what the Lottery Commission is 
23   charged to do under the Bingo Enabling Act.
24                 Now, can we assist?  Yeah, I think we 
25   can, and I think we have.  And I think that the 
0061
 1   Lottery Commission, more than any other agency that's 
 2   ever regulated charitable bingo, has done more for 
 3   charitable bingo.  And I might even go so far as to 
 4   say that this agency probably does more than any other 
 5   jurisdiction in the United States or anywhere in -- in 
 6   North America.
 7                 If you look at the things that, you 
 8   know, we've done and we've put on the website such as 
 9   how to talk to the media, the operations manual, the 
10   various press releases that we put out, the public 
11   service announcement that we are working on and we'll 
12   hear more about later on.  We look at how we regulate, 
13   and I think we look more to appropriate regulation.
14                 One case in point is the rule that came 
15   before you today.  And the fact is, you know, I 
16   wouldn't even refer to it as being more lenient; but I 
17   refer to it as, you know, giving the commission a 
18   little more discretion.  So, you know, but there are 
19   some organizations who, you know, probably had 
20   legitimate reasons for filing untimely.  Now instead 
21   of automatically taking those licenses, we are able to 
22   work more with the organization.
23                 But at the end of the day, it is going 
24   to be that organization's responsibility to make sure 
25   those reports get filed timely.
0062
 1                 MS. LOPEZ:  Sure.
 2                 MR. ATKINS:  And I think that the -- 
 3   that the question Commissioner Cox is asking -- and I 
 4   think, you know, a -- a question that has been asked 
 5   before is just, you know, what else is there.  You 
 6   know, for the people that were here, you know, we 
 7   remembered when everybody was advocating for card-
 8   minding devices.  You know, card-minding devices were 
 9   going to save the world.  Do you remember that?  It 
10   was going to be this huge influx of people and young 
11   people.  You know, the average appearance at the bingo 
12   hall was going to go up.  You know, players were going 
13   to be about 25 years old, and there was going to be a 
14   ton of them.  And, you know, I don't think that's 
15   occurred.
16                 Now, you know, we did see fortunately 
17   a -- some little benefit from the pull-tab rule, in 
18   terms of sales anyway; but I don't know that we've 
19   seen, you know, revenue going to charitable 
20   distributions, which I think we would agree would be 
21   the bottom line for the charities.  So I know that 
22   that's something that the commissioners are very 
23   mindful of.  And I know that whenever I go in front of 
24   the commissioner and, you know, even in the case of 
25   this progressive bingo rule, you know, they are going 
0063
 1   to be asking, okay, what do we expect that's going to 
 2   do to charitable distribution?  
 3                 So I don't know if I completely 
 4   answered your question.  I don't know if I, you know, 
 5   answered it to your satisfaction.  I can't tell you 
 6   that you're out there on your own and this agency 
 7   doesn't care because this agency does care.  But there 
 8   are certain limitations that we have and those 
 9   limitations are imposed on us by statute.
10                 MR. WHITTINGTON:  You know, I was 
11   sitting here listening to you, but when it comes to a 
12   charity that is actively playing bingo in a bingo 
13   hall, isn't that revenue to the state?  
14                 MR. ATKINS:  Uh-huh.
15                 MR. WHITTINGTON:  Okay.  I think there 
16   should be some reason that the -- like the three 
17   times.  If they're late three times they should be 
18   okay, blah, blah, blah, blah.  They want their license 
19   revoked because the license was revoked the first 
20   time.  That would be decreasing revenue to the state 
21   because they wouldn't be playing bingo.  So charities 
22   are regularly involved with the Texas Lottery 
23   Commission as well for revenue purposes as well as to 
24   help charities and kids or, et cetera, whatever it 
25   might be helping at that point.  So I can understand 
0064
 1   what you are saying.
 2                 The Texas Lottery Commission isn't 
 3   there to help us fix it.  So the Texas Lottery 
 4   Commission -- I mean, that's what it's all about is 
 5   the Texas Lottery Commission.  And we are an arm up 
 6   under the Texas Lottery Commission for -- only for 
 7   regulating purposes.  Okay.  And that's all we are 
 8   basically.  Yes, they have helped a lot.  Yeah.  
 9   What -- what organizations as well -- I -- I guess 
10   started a couple of years ago, but up until two years 
11   ago, I don't think there was too much help.  They are 
12   getting more involved in helping us.  And it's very 
13   much appreciated on our part, but still there's a lot 
14   of things that need to be changed.
15                 CHAIRPERSON TAYLOR:  Looking at the 
16   numbers, what I'm seeing is that we have been able to 
17   hold our gross receipts up to what they were 
18   pre-lottery, but it's cost us a lot to do that.
19                 MR. WHITTINGTON:  Oh, yes.
20                 CHAIRPERSON TAYLOR:  It's cost 
21   electronics.  Because we have added electronics, on 
22   the whole it just cost us $20 million last year in 
23   rent, which we used to have that 20 million left 
24   over.  We were able to bring in more people to spend 
25   as much money as they are spending now with fewer 
0065
 1   expenses.  The expenses have risen, but we've had to 
 2   pay the expenses to keep the numbers up there trying 
 3   to go on with our business.  We didn't have to pay out 
 4   more.  We were paying for --  approximately 35 
 5   percent, we were netting off of this.  And now we are 
 6   not off of our tab sales.  And now we are probably 
 7   mostly netting 25 to 27 percent off of the sales.
 8                 So although the sales have gone up to 
 9   increase the interest of the bingo hall, there has 
10   been a cost to that.  And the cost to that is that 
11   cost of increased pay outs and the cost of increased 
12   boxes of tabs you are paying for.  So everything is 
13   relative.
14                 I mean, when we -- Kim and I were going 
15   through these 2003 and 2004 numbers, what we seeing, 
16   although the numbers went up, the percentage of our 
17   expenses and everything almost stayed within one 
18   percent.  I mean, the rent stayed the same; the cost 
19   of the lease stayed the same.  Everything stayed about 
20   the same because everything is going up in relation to 
21   the income going up.  So the -- we would have had 
22   19 million more if we weren't doing lease-minders.  
23   But if we weren't doing lease-minders -- I mean, the 
24   electronic card-minders, we would be having low 
25   attendance in the hall or the hall would close down.
0066
 1                 You know, so it's like we're -- we're 
 2   paying the piper to try and save business.  I see the 
 3   numbers at our hall doing the same thing.  And we're 
 4   following the state right down to the tee with the 
 5   increased cost to stay in business.  We did it right 
 6   down to our bottom line.
 7                 MR. WHITTINGTON:  The other thing -- 
 8                 CHAIRPERSON TAYLOR:  I mean ultimately 
 9   we don't know.  We need to have more attendance in the 
10   bingo halls.  I mean, I'm running a commercial.  We 
11   run commercials, and there are certain people who say 
12   they saw the commercial, which is even nicer.  But I 
13   mean, that's another cost.  You know, they're trying 
14   get other people that haven't been in the hall, in the 
15   hall.  And until we get new people in our halls, it -- 
16   I mean, we are going to continue with this.
17                 And when we are in our halls operating  
18   750-dollar games, and the lottery is out at $350 
19   million, you know, it's hard to get people to come and 
20   spend their dollar there.  You know, we've got the 
21   increased gaming, I think, has given us a lot of 
22   roadblocks.  And a lot of the things that we have put 
23   in our halls have been because of the competition that 
24   we are trying to work against in ways that put us in a 
25   lull.
0067
 1                 MR. ATKINS:  That may be your answer.
 2                 MS. ROGERS:  I totally agree.  I 
 3   totally agree with Suzanne.  And now to answer the 
 4   Commissioner -- Commissioner Cox, his -- his question, 
 5   until we change and broaden, which is I think what we 
 6   do -- what we are trying to do, and I will admit the 
 7   short time I've been on here, the Lottery now has 
 8   begun to regularly give us more information and 
 9   helping us.  I don't -- I don't think we are totally 
10   standing on our own, but we have to understand the 
11   boundaries of where they are at and where we are.  
12   They can assist us, but we are going to have to stand 
13   up and holler and scream and fight for every bit of 
14   assistance that we get, you know; but I think we do 
15   get more.
16                 But until we change and become -- our 
17   world has changed in 20 years, you know.  The times 
18   have changed.  Kids who at 25 want different things 
19   than they did 20 years ago.  Individuals who are 60, 
20   you know, they want something different.  And we see 
21   proof on event tabs in the aspect of people are 
22   enjoying them.  Maybe that's why we kept our 
23   attendance not to totally fall off, you know.
24                 So all we can do is try to get a 
25   work group that's working on changing the games, 
0068
 1   progressive; to try and keep us up with somehow 
 2   Louisiana and Oklahoma and everybody else who has 
 3   these large gaming, you know, casinos.  They want to 
 4   play different things.  I know that, and we want to 
 5   hear that with our customers, not to sound like a 
 6   broken record, but, again, you know, I think we're 
 7   doing that as hard and fast as we can.
 8                 MR. MANIO:  I have some comments 
 9   about -- if I may.  First of all, I would like to say 
10   that it is very encouraging that Commissioner Cox 
11   asked these questions because as far as I can 
12   remember, we have been talking about this problem of 
13   profitability in bingo for the last three years, every 
14   single session, from every member of the committee to 
15   members of the public.
16                 One of the charts that was presented by 
17   Phil, quarterly average number of players per 
18   occasion, sum is up, the prospect of the -- of the 
19   bingo industry.  See our -- our average attendance has 
20   gone from 162 to 138.  That is almost a 15 percent 
21   drop in the market share.  And any business that has a 
22   drop of that much in market share will be in deep 
23   trouble.  And the corporate landscape is full of 
24   companies like that, that lost their market share and 
25   they have either merged or went out of business or 
0069
 1   sold their business.
 2                 For example, K-Mart is struggling today 
 3   to get with Wal-Mart.  We have A&W and Dairy Queen 
 4   fighting to remount from the impact of McDonalds and 
 5   Burger King.  Now, there are certain things that we 
 6   can do to either increase our attendance or maintain 
 7   what we have today.  Promotions for one thing, you 
 8   know, in bingo halls; we can do a lot of mailings; we 
 9   can do a lot of promotions; live ones, just to keep 
10   people playing bingo in our bingo halls, but there is 
11   a limit as to our activity.
12                 What has happened in bingo today really 
13   is we have stagnated.  We have -- we have not kept up 
14   with our competition, which is amusement places and 
15   other company establishments.  For example, the limits 
16   of the prices that we have today are the same as they 
17   were 15 years ago, and we cannot effectively compete 
18   with Louisiana or Oklahoma with what we have today.  
19   Obviously this is not a function of the Lottery 
20   Commission.  We need help from the state to give us 
21   the tools to compete with other amusement places.
22                 And the -- the pull-tab that was 
23   approved about three and a -- three years ago.  That 
24   was a wonderful innovation.  It increased our 
25   revenue.  On the whole, it increased expenses; but it 
0070
 1   didn't bring more people into the bingo halls.  What 
 2   it has done is it has kept a large number of 
 3   conductors in business.  But if you look at the 
 4   number, even the number of conductors has reduced 
 5   since three years ago.  There was still some 
 6   casualties along the way because of a lot of 
 7   fatalities.  Either they quit bingo, or they could not 
 8   pay their prize fees and their license was revoked.
 9                 So it's innovation that we need in the 
10   industry, something that will bring people back into 
11   our bingo halls, something that will bring people back 
12   into our bingo halls, something that will make it more 
13   attractive to the public.  And that's my 10 cents 
14   worth.
15                 MS. ROGERS:  I just want to add one 
16   quick comment before we let the commissioner talk.  
17   You know, we -- we say that how the event tabs brought 
18   up, you know, the revenue and everything, but I would 
19   also -- and I'm making an assumption here -- that 
20   there are halls that don't play the event tabs.  Are 
21   they somehow going to stay down, you know?  So 
22   sometimes I think that has to be looked at also.  Do 
23   you understand what I'm saying, my comment?  
24                 MR. MANIO:  Well, I don't know if we 
25   have -- we can analyze the numbers.
0071
 1                 MS. ROGERS:  Well, I don't know if we 
 2   can analyze that.
 3                 MR. MANIO:  Probably not.
 4                 MS. ROGERS:  But we...
 5                 CHAIRPERSON TAYLOR:  Commissioner, 
 6   please.
 7                 COMMISSIONER COX:  May I make a 
 8   comment, ma'am?
 9                 CHAIRPERSON TAYLOR:  Yeah.
10                 COMMISSIONER CLOWE:  My name is Tom 
11   Clowe.  I'm chairman of the Lottery Commission.  
12   You-all have come such a long way from where we 
13   started.  You know, we've been really talking about 
14   this since I've been on this board.  And I think 
15   Suzanne, Kimberly, Mario, you have absolutely 
16   identified what the situation is and what the problem 
17   is.  And it is so interesting that the bingo 
18   operations -- and it's different from the lottery.
19                 We talked about the obligation of the 
20   commission is to regulate bingo.  It's not the state's 
21   business.  But as Billy said, and I think it was well 
22   stated, this commission does care about it.  It cares 
23   about the distribution to the charities and it has 
24   tried to demonstrate support for that in every way 
25   that it can within the statute that governs.
0072
 1                 On the other hand, with lottery, the 
 2   state owns that.  The proceeds go to the state and we 
 3   have been trying to do the things that you are talking 
 4   about trying to do in bingo, in lottery:  be 
 5   innovative, be creative, freshen it, make it 
 6   attractive to the players, whether they be 25 or in 
 7   their 70's.  The problem is that there is a statute 
 8   that we must follow in both cases and we must be 
 9   guided by that.  And it is an issue that is not 
10   universally agreed upon relative to the things that 
11   you would like to do to freshen, to make it 
12   attractive.
13                 There are those which I have always 
14   said you must be respectful of who don't want gaming 
15   of any kind in the state.  And that applies to bingo 
16   as well as to lottery.  And so when you attempt to do 
17   the things that you see as a person will increase the 
18   contribution to charities or increase contribution to 
19   the Foundation School Fund, there is that group that 
20   says, no, don't do that.  We don't want that.  And at 
21   the same time in a difference from when the lottery 
22   started -- and bingo started a long before that -- but 
23   when the bingo -- lottery started in '92, we now have 
24   eight-liners.  We now have internet gaming.  We now 
25   have the casinos across the state borders, and you've 
0073
 1   got lotteries across the state borders that you didn't 
 2   have in '92.  And Power Ball surrounds us.  I've been 
 3   an advocate to try to get in Power Ball and Mega 
 4   Millions, and I haven't been successful in that.  That 
 5   was just along the lines that you-all were talking 
 6   about.
 7                 Your discussion here this morning is so 
 8   intelligent.  It's point on.  You've identified what 
 9   the real problem is; and it's one that the 
10   commissioners, I think, have identified.  And we just 
11   recently put up a rule, if you're aware of what's 
12   going on in the lottery, where the staff wants to move 
13   the on-line games from a rules to a procedural type of 
14   thing, similar to the instant scratch-off tickets.  
15   And we've had a lot of comment from the people in the 
16   state about that, and the commissioners are going to 
17   deal with that on the 27th.  And I suggest that maybe 
18   you listen in on that meeting on the 27th because it 
19   might reflect to you what the commission is dealing 
20   with in regard to lottery and trying to refresh and 
21   make the games more attractive.  It might show you 
22   some of the things that the commission is dealing with 
23   that might be applicable with what you are dealing 
24   with in the bingo industry.
25                 I think the need that we are dealing 
0074
 1   with here is the one that by the Bingo Act and the 
 2   progressive rule that you-all are working on is right 
 3   within that.  Billy and I had a discussion this 
 4   morning.  I said is it within the Act?  Are you 
 5   confident that what we are working on here lies within 
 6   the limitations of the law.  He said, yes, I am.  
 7   Well, then I think that's a good thing to be working 
 8   on.
 9                 Commissioner Cox is in the building, 
10   and I think it would be good for me to excuse myself 
11   now and for him to come in so that you can hear from 
12   him on this subject of your agenda what his questions 
13   were and what his intent was and then you can compare 
14   any comment that he might make to those comments that 
15   I've made.
16                 Is there any question for me?  Larry?  
17                 MR. WHITTINGTON:  Well, basically, I'm 
18   going to say most of you guys are ready as far as 
19   gross and that would probably be the same because of 
20   the different styles of play people right now.  If we 
21   get more people in the bingo halls, the revenue -- the 
22   gross revenues will go up -- go up even more, but like 
23   I said, the same net as far as equal what we are now 
24   because of the situation that the charity is paying 
25   higher expenses, higher electrical bills, everything 
0075
 1   else, pull-tabs are making less than what they used 
 2   to.  So even if we had more people in the hall and the 
 3   revenue skyrocketed, we are going to see the same 
 4   percentage we are now.  Basically, I bet.
 5                 CHAIRMAN CLOWE:  You see that's exactly 
 6   what the lottery is dealing with because the scratch-
 7   off tickets which have a higher percentage in payoff 
 8   are now, oh, about 72 or 73 percent of total gross 
 9   revenue.  So the -- the lottery is struggling, really 
10   struggling with increased sales to keep that one 
11   billion dollars a year return to the Foundation School 
12   Fund.
13                 The situation is -- is peril.  That's 
14   what I mean when I say we're -- in both of these 
15   industries, we are going down the same road.  And it's 
16   not the expenses that are rising with lottery, it's 
17   the pay out that is rising.
18                 MR. WHITTINGTON:  But we'll take that 
19   net as our net with more people.
20                 CHAIRMAN CLOWE:  In both -- actually I 
21   think the bingo net is going down a little bit where 
22   the lottery has been able to kind of keep it even.  
23   But I'm not -- I'm not real optimistic about the 
24   future because you have all these competitive 
25   entities, eight-liners, casinos, internet gaming.
0076
 1                 I -- I got a solicitation over my 
 2   computer.  I don't know how they got my e-mail 
 3   address, but they invited me to open an account and 
 4   gamble on the internet, and I saw a debate on CNBC 
 5   whether it was legal or not.  One guy was saying, 
 6   absolutely, it's illegal.  And the other guy was 
 7   saying, absolutely, it's legal.
 8                 MR. WHITTINGTON:  But please don't 
 9   leave out poker because poker is really getting pretty 
10   intense.  
11                 MS. LOPEZ:  It's real big.
12                 MR. WHITTINGTON:  Underground kids are 
13   playing.  They had a big add on TV about the 
14   teenagers, a bunch of them playing underground where 
15   the kids were betting on it.  And they finally shut 
16   that down in Dallas.
17                 CHAIRMAN CLOWE:  I had a reunion, 
18   Larry, of my high school graduating class last Friday 
19   in Dallas, and I asked them, how many of them played 
20   the lottery and how many of them played bingo and more 
21   of them -- these are all people in the 70's -- more 
22   people play bingo than play the lottery.  I mean, 
23   that's your age group.
24                 Well, let me -- let me excuse myself 
25   and ask Commissioner, while you are on this agenda 
0077
 1   item, to come in and give you his view because he 
 2   asked some good questions.
 3                 And, Sandy, I don't think anything I've 
 4   said -- as our lawyer -- precludes anything 
 5   Commissioner Cox wanted -- would want to say because 
 6   we both commented on this individually.  And when he 
 7   gets here, we are not in violation of the act, are we? 
 8                 MS. JOSEPH:  That's correct.  I agree.
 9                 COMMISSIONER CLOWE:  Okay.  Let me -- 
10   let me leave so that Commissioner Cox can come.
11                 CHAIRPERSON TAYLOR:  Okay.  Thank you, 
12   Commissioner.
13                 COMMISSIONER CLOWE:  Okay.  Billy, will 
14   you e-mail -- 
15                 MR. ATKINS:  I just did.
16                 COMMISSIONER CLOWE:  Good.  Thank you.
17                 CHAIRPERSON TAYLOR:  I have one small 
18   disagreement with what you said, Larry.
19                 A lot of the expenses on a session are 
20   fixed.  I mean, we're going to have the same 
21   expenses.  And I think if the attendance goes up, 
22   we're still going to pay the same rent.  We're going 
23   to have the same electric bill, the same bills, the 
24   same employees.  Attendance is where we need to get it 
25   up.  There some expenses if they play more electronics 
0078
 1   or, you know, the event tabs.  But I think overall 
 2   attendance is what we've got to get in the hall 
 3   because that's -- that's our bottom line is getting 
 4   more people in that door.
 5                 MR. WHITTINGTON:  I know, but my 
 6   electric bill will change too.
 7                 CHAIRPERSON TAYLOR:  But it's still not 
 8   going to -- it's not to go up any more if you have 
 9   more people in it.  
10                 MR. WHITTINGTON:  No, I'm not -- I'm 
11   not talking about --
12                 CHAIRPERSON TAYLOR:  Not significantly 
13   but --
14                 MR. WHITTINGTON:  Like I said, it will 
15   be expense-wise.  
16                 MS. ROGERS:  The expenses.
17                 MR. WHITTINGTON:  The expenses are 
18   where it goes.
19                 CHAIRPERSON TAYLOR:  Not that much 
20   though.
21                 MS. ROGERS:  Yeah.  Mine -- mind did 
22   too.  I was paying eight point something, and my 
23   contract expired and now I'm not paying the same thing 
24   on the electric bill.
25                 MS. LOPEZ:  Again, one other comment 
0079
 1   I'll just make again, you know, lack of attendance.  
 2   But that's an important thing because the attendance 
 3   is the public awareness.  Without that public 
 4   awareness, without that publicity, you know, to get 
 5   people excited about coming to play bingo, that's 
 6   where the biggest -- biggest need is.
 7                 MR. WHITTINGTON:  They need exciting 
 8   things happening, more exciting things.
 9                 MS. ROGERS:  The younger -- younger 
10   generations have not -- don't appreciate it, I don't 
11   think.  For some reason they don't see -- advertising 
12   I guess -- they don't know the fun, what you can win 
13   and what you can do at a bingo hall.  But that again 
14   in lies on us to get it out there which we are trying.
15                 CHAIRPERSON TAYLOR:  When we are 
16   talking about young people, every gas station they 
17   stop to put gas in their car, has the lottery sitting 
18   right there advertising to them.  If we could have 
19   bingo advertising to everybody, the same way 
20   they'll -- you know, they see the lottery, then we can 
21   get young people in the hall.  But young people will 
22   draw young people.  If we can start getting young 
23   people in there, they will bring their friends.
24                 MS. ROGERS:  That's right.  They will.
25                 CHAIRPERSON TAYLOR:  But when they walk 
0080
 1   in the hall and they are the only one there, you know, 
 2   under 40, chances are they're not going to come back 
 3   again.  But if we can get a group, I mean, starting 
 4   with those younger people to replace our older 
 5   players, that, you know, can't make it to the hall 
 6   anymore -- 
 7                 MR. ATKINS:  I think, in part, also 
 8   part of the attraction to a younger crowd is also, in 
 9   part, a result of where you are actually located.  For 
10   example, we did -- or I did an interview -- it's 
11   probably been about a year ago with the publication 
12   here in Austin called The Austin Chronicle and the 
13   reporter was, I would say, probably in her mid 20's 
14   and what got her interested in doing the article was 
15   because she had a group of friends who would go out on 
16   a Friday and Saturday night and their first stop would 
17   be the Bingo Net.  And then they would go to a club, 
18   go dancing, whatever.
19                 But, you know, in her case, kind of -- 
20   kind of her question was:  Why don't more young people 
21   do that.
22                 MS. ROGERS:  We don't have a younger 
23   crowd at our bingo hall.
24                 MR. WHITTINGTON:  We do.
25                 MS. ROGERS:  Yeah.  You do?.
0081
 1                 CHAIRPERSON TAYLOR:  At this time we 
 2   would like to recognize Commissioner Cox.  We 
 3   appreciate you being here.  We are discussing a topic 
 4   that you discussed at the last meeting and we did have 
 5   a concern as to the decline in attendance and the 
 6   decline in games and how did we -- what was our 
 7   reaction.  So did you want to give us any input on 
 8   this?  It's what we've been discussing.
 9                 COMMISSIONER COX:  Let me listen for a 
10   while.
11                 CHAIRPERSON TAYLOR:  Thank you.
12                 MR. ATKINS:  I'm -- I'm afraid they -- 
13   they may have gotten all talked out before you got 
14   here, Commissioner Cox.
15                 COMMISSIONER COX:  That's okay.
16                 MR. ATKINS:  They had -- they had a -- 
17   I think, a very engaged conversation and this is Item 
18   Number 7 in the notebook.  And what I did was I took 
19   your question from the September, 2005, commission 
20   meeting where we had provided a presentation on, at 
21   that time, the second quarter 2005 financial data for 
22   bingo.  And you had commented on the fact there 
23   appeared to be a continuing decline in the number of 
24   organizations conducting, the number of occasions that 
25   bingo held, and the number of attendants while there 
0082
 1   was an increase -- while gross receipts were 
 2   increasing.  And you had expressed a concern that 
 3   that, in general, was not a healthy business situation 
 4   really, for, anyone.
 5                 So your question was if it was 
 6   something the BAC had looked at it, that they had any 
 7   reaction to it, if they had any concerns about it, and 
 8   if they had any plans about it.  So I think that's 
 9   what the group has been discussing.  And I think kind 
10   of if -- if I can say in a consensus -- and if I 
11   misspeak, you know, hopefully anyone will -- will -- 
12   will correct me -- yeah they do have a reaction to it, 
13   and they have a concern about it.
14                 I think so far what I've heard is that 
15   their plan or any plan for that is limited by the 
16   Bingo Enabling Act, that primarily what the industry 
17   is experiencing is a progressive increase in 
18   competition for those discretionary dollars as 
19   particularly in the area of gaming, both within this 
20   state and the surrounding states, and on the internet, 
21   and that barring any type of legislative relief, I 
22   don't know if there is any degree of certainty of any 
23   type of significant improvements that can be made.
24                 Now apart from that, there still are 
25   things that are being looked at such as the 
0083
 1   progressive bingo rule that is still within the 
 2   parameters of the existing statute.  If that is 
 3   something that offers any relief, it would much likely 
 4   be to smaller organizations.  But it may be something 
 5   that organizations can point to in future legislative 
 6   sessions, if it's an issue that comes up again.  But I 
 7   think where the conversation was finally leading off 
 8   was a real concern about attendance and the lack of 
 9   growth in attendance.  And hopefully that's a fair 
10   assessment of what happened.
11                 MR. WEEKLEY:  I believe that loss of 
12   attendance, increase in revenues and loss of 
13   attendance.
14                 MS. ROGERS:  Also, again -- and I just 
15   want to be sure what Billy said my comment was that 
16   basically until we -- we realize until we change it 
17   and we change the games for today, that our attendance 
18   will continue to drop off, you know; and we won't be 
19   able to bring up our net.  So we understand that, but 
20   I think we also are moving that way.   We are trying 
21   to at least.
22                 MR. MOORE:  I'll add something to that 
23   too.  I think what you find here, we've seen it year 
24   after year.  Our initial reaction is somebody is going 
25   to say, the TLC needs to help us.  And they can't do 
0084
 1   it.  And we know we need to do it outside of here in 
 2   lobbying efforts and things like that.  And 
 3   unfortunately with an industry that's slowly 
 4   crippling, there's no monies to do that.  And to get 
 5   the 1300 charities together to put money into an 
 6   effort is nearly impossible.  So it -- it falls on 
 7   very few shoulders.  And we've tried outside of this 
 8   room here to do it.  And it's frustrating, I think, 
 9   for a lot of people, to work hard day after day in 
10   bingo halls.  And, you know, it would be great if the 
11   Lottery Commission could help, but that's not the way 
12   the Bingo Enabling Act was designed.  I personally 
13   think that maybe that's what we need to look at.  
14   Okay?
15                 You know, it does say that you enforce 
16   bingo, but maybe it should be changed to promote 
17   bingo.  You know, and maybe that's something that's 
18   looked at.  But I think the frustration in the 
19   trenches, in the bingo halls, is at the end of the 
20   day, the deposit isn't adding up to what the expenses 
21   are.  That's what it is.  And you look out in these 
22   bingo halls -- when I walk in and I'm wondering how in 
23   the hell they are open honestly.
24                 MS. ROGERS:  Well, I have a question.  
25   To change it from regulating, slash -- putting slash 
0085
 1   promotion in there, that's the legislation, correct?  
 2                 MR. WHITTINGTON:  Oh, yeah.
 3                 MS. ROGERS:  Okay.  I just want to make 
 4   sure.
 5                 CHAIRPERSON TAYLOR:  One of the other 
 6   things that we were discussing is that in order for 
 7   the bingo halls to remain competitive, we all agree 
 8   that we've had to increase expenses because we've had 
 9   to pay for the electronic rental.  We've had to pay a 
10   higher pull-tab pay out, but those are the things that 
11   have kept us in this business, with the decrease in 
12   attendance.  But unfortunately the expenses are rising 
13   even with the decrease in attendance because it's 
14   costing us more just getting business to remain a bit 
15   competitive and a bit interesting to the players who 
16   have so many options now.
17                 But ultimately I think we all know 
18   legislatively is where it's going to need to be 
19   because we need legislative changes.  And I absolutely 
20   agree.  I would love to see that, it changed to also 
21   promote bingo, the same -- the same wording it has for 
22   the lottery.  If we can have that --
23                 MR. WHITTINGTON:  Yes.
24                 CHAIRPERSON TAYLOR:  -- and -- and have 
25   a little bit of money for an advertising campaign.  
0086
 1   And I know we've talked before.  I mean, if each of 
 2   the charities in the state -- the same way we had to 
 3   kick in for the computer system -- if each of the 
 4   charities could put into an advertising fund and that 
 5   fund was used the same way that the lottery 
 6   advertising was used, I mean, ultimately, I think 
 7   that's when we can see our attendance numbers going 
 8   up.
 9                 I always dread selling advertising on 
10   TV because I know I'm not just advertising my hall.  
11   I'm advertising every hall in the town because they're 
12   going to the hall that's close to them initially, if 
13   they're going to play.  They might get the idea of 
14   going to bingo, but I've paid for the ad and somebody 
15   else is receiving, you know, the -- the money from the 
16   customers.
17                 It's very hard trying to get other 
18   halls in to try to do a joint advertising campaign, 
19   and one other hall in town is willing to go in on that 
20   campaign with me because everybody else is, like, 
21   we're doing okay now.  We're doing okay.  Well, you're 
22   not doing okay.  I see that you've got less than 100 
23   people sitting in your hall.  You know, you might be 
24   easing by, but you're not doing okay.  Anyone and 
25   everybody else is doing okay.
0087
 1                 All these pre-numbers, I mean, oh, my 
 2   gosh.  Ten years ago our average attendance in the 
 3   hall was 280 people.  I mean, we would drop dead now 
 4   if 280 people came to our hall.  We would all be on 
 5   our knees thanking the Lord.  I mean, the fact is I 
 6   can't remember the last time I've seen 280 people in 
 7   the bingo hall.  You know, now 180 is the maximum 
 8   attendance.  You know, but 180 we can do okay but only 
 9   because we are paying an additional cost to draw more 
10   money out of their pocket.
11                 MS. ROGERS:  And I -- and I think 
12   seeing advertising, that is -- that is a huge, huge 
13   part of it.  But it also needs to go together, you 
14   know, like Billy said.  Computers are going to save 
15   everything.  Well, they didn't.  Pull-tabs.  But they 
16   all did help if you bring all that together.  But we 
17   do to have to get together.
18                 MS. LOPEZ:  And I just want to comment.  
19   You know, we talked about all the things, about 
20   charities putting in money to a national cause -- to a 
21   statewide advertising campaign and I don't know if 
22   this is something that can be legally be done, but 
23   it's a question.  You know, how our -- each one of our 
24   counties in our cities receive monies every quarter.  
25   Maybe some of those monies could be earmarked for the 
0088
 1   advertising campaign and so directly going to that 
 2   particular city where it be like Odessa and Ector 
 3   County, take some off the top of that for your 
 4   advertising campaign.  And that makes everybody happy.  
 5   The city and the county still get money.  Charities 
 6   get the benefit.
 7                 MR. WHITTINGTON:  You would have to 
 8   change the law to do that.
 9                 MR. ATKINS:  I don't think so.
10                 MS. LOPEZ:  Yeah.  I don't know.
11                 MR. ATKINS:  There is no -- there is no 
12   statutory limitation that I'm aware of on those local 
13   municipalities.  You know, we -- you know the state 
14   issues -- it's just like a -- the -- the tax refunds 
15   that they get from the comptrollers.  Local 
16   jurisdictions are free to do with it as -- as they 
17   wish.
18                 CHAIRPERSON TAYLOR:  They can't be 
19   guided by the Lottery Commission as to what they want 
20   to do with it.  Is that correct?
21                 MR. ATKINS:  I think that with all of 
22   the organizations in this state, those local 
23   jurisdictions would be least interested in what the 
24   Lottery Commission has to suggest that they do.
25                 MR. SANDERSON:  There -- there may be 
0089
 1   just one -- there is one provision that says only a 
 2   licensed authorized organization, commercial lessor, 
 3   or the commission may advertise bingo.  It's in the 
 4   statute.
 5                 MR. ATKINS:  That's correct.
 6                 CHAIRPERSON TAYLOR:  So, I know that's 
 7   not a change in the statute.  The lottery commission 
 8   can hold on to some of that money to advertise bingo.
 9                 MR. ATKINS:  No.  For attendant -- from 
10   the allocation?
11                 CHAIRPERSON TAYLOR:  Yeah.
12                 MR. ATKINS:  No.
13                 MS. ROGERS:  Because they get a certain 
14   percentage, that's written in the statute.
15                 MR. ATKINS:  That's correct.
16                 MR. WHITTINGTON:  Well, let me just 
17   add, I want to say in Dallas any freeway you've got 
18   now, no matter where you're going, you've got 
19   Oklahoma, 45 minutes to go, versus Freeport, 
20   Louisiana.  Which one you want to go to?  So that -- 
21   that's what's really killing us as well as the Texas 
22   Lottery, that advertising in Dallas.  That's all you 
23   see, every major freeway and every highway, you know, 
24   Oklahoma versus Louisiana casinos, nothing about 
25   bingo.  And it's hurts a lot because they are just 45 
0090
 1   minutes a way.
 2                 MR. WEEKLEY:  The entertainment 
 3   business. 
 4                 CHAIRPERSON TAYLOR:  I think even --  I 
 5   mean, we're not on the border but we've got the Texas 
 6   Treasure 15 minutes, not hard to walk.  Or you can 
 7   pass the greyhound race track seven minutes from my 
 8   mall and come over there.  So, I mean, we all -- 
 9   either we're at the border or... we're facing the same 
10   thing.  Once again, it's the competition.
11                 MS. ROGERS:  And unfortunately we 
12   cannot make them go away.
13                 MR. WHITTINGTON:  Right.
14                 MS. ROGERS:  We've got to make us 
15   better.
16                 MR. WHITTINGTON:  Right.
17                 MS. ROGERS:  We've got to become better 
18   than them because they are going to be there.
19                 MS. LOPEZ:  But, again, you know, 
20   casinos have lots of money.  We are faced with Hobbs 
21   being 45 minutes away from Odessa, Midland.  If we get 
22   in our car, drive over there, spend a day or two.  
23   They have all these huge, you know, promotions and 
24   giveaways.  And they advertise on our local television 
25   stations all the time.  We can't compete with that.
0091
 1                 MR. WHITTINGTON:  The only thing about 
 2   visiting bingo, you're going to want to pay -- play 
 3   more.  You're going -- you're going to want more.  If 
 4   you play bingo one time, oh, I like this.  I want to 
 5   play more.
 6                 MS. ROGERS:  Well, it's a proven fact 
 7   that people who like to play bingo, go to play --
 8                 MR. WHITTINGTON:  Yes.
 9                 MS. ROGERS:  -- games of chance.
10                 CHAIRPERSON TAYLOR:  And you know, 
11   I'm -- I'm going to bring this right here in the 
12   middle of it also.  Right now the lottery is talking 
13   about video lottery terminals at the race tracks.  If 
14   that happens, I mean, there's already been a study 
15   done on what they are supposed to do, and it's going 
16   to desecrate bingo.  Unless, of course, bingo is 
17   included in that, I have yet to understand why you 
18   would bring in a race track, if you have not even 
19   considered when we have bingo halls that already have 
20   been licensed and we are all -- we are all within your 
21   umbrella at this time.  I mean, it would be the 
22   perfect marriage.  It might help save both entities.
23                 MS. LOPEZ:  And also -- 
24                 MR. ATKINS:  Well, let me -- wait.  
25   Before you say anything -- 
0092
 1                 COMMISSIONER COX:  I want to say that 
 2   there are folks that the Lottery Commission is not 
 3   proposing to use them with respect to the terminals.  
 4   There are folks out there who are, but we are not.  
 5   Now we may be part of a what is going to come to a 
 6   legislative session of the resource in a previous 
 7   session, but we are not advocating any kind of 
 8   expansion of gambling on that.
 9                 Did I take the words out of your mouth, 
10   Billy?  
11                 MR. ATKINS:  You did very eloquently.
12                 MR. MANIO:  Suzanne, talking about help 
13   from our lawmakers and more that I see to get our 
14   message across.  This here is our message here.  We 
15   have an opportunity to get our message across to 
16   hundreds of members of the Senate or the house.  Some 
17   of them will be asking to appear before American 
18   Legion meetings or Amvets meeting.  And we can get 
19   some of our organizations to be at those meetings and 
20   pose a question to those kind of debates.  This is the 
21   situation in bingo.  Do you have any plans or any -- 
22   any ideas on how we can rejuvenate people, but it's 
23   this year.
24                 MS. ROGERS:  Is there a way within us 
25   to form a group -- this is just off the top of my 
0093
 1   head -- to form a group to look at who is running and 
 2   who is going to maybe advocate bingo and get that 
 3   message out to everybody?  You know, within us, within 
 4   our charities can go further or...
 5                 MR. MANIO:  From a -- from a point of 
 6   view, it depends whether he's a republican or 
 7   democratic -- 
 8                 MS. ROGERS:  No, I don't.  Me either.
 9                 MR. MANIO:  -- this is our problem.  
10   How can -- how can we deal with is?
11                 MR. ATKINS:  Let me -- let me real 
12   quick.  I think Sandy is getting read to ask how this 
13   falls under this item.  But the last thing that I want 
14   to throw in was what we were talking, Mario, is I 
15   would just caution any organization before they did 
16   that.  And they do go back and look at the Bingo 
17   Enabling Act as well as probably the Internal Revenue 
18   Code in terms of their activities in the political 
19   arena.  So having said that, I just will leave that at 
20   that and keep Sandy from asking her question.
21                 CHAIRPERSON TAYLOR:  Well, I think this 
22   relates to one of our plans.  And maybe it -- and I 
23   understand that you can't be promoting a particular 
24   candidate and all of that.  But we can go to plan to 
25   try and, as charities, pick all the candidates so we 
0094
 1   would not be asking -- we wouldn't be supporting one 
 2   candidate over another candidate.  We just want to 
 3   make all of them aware of -- of our concerns.
 4                 MR. WEEKLEY:  It's important.
 5                 MS. JOSEPH:  I -- I would just want to 
 6   caution that as the Bingo Advisory Committee per se 
 7   the statute does not include that as one of the duties 
 8   or purposes of the group, so I don't believe you can 
 9   represent yourself in that capacity as the Bingo 
10   Advisory Committee in going to the legislature.
11                 CHAIRPERSON TAYLOR:  But we could as 
12   individual charities and organizations.  I understand 
13   what you're saying.
14                 MR. WHITTINGTON:  Right.
15                 CHAIRPERSON TAYLOR:  We are not 
16   speaking on behalf of the BAC if you do this.
17                 MR. MOORE:  That's fine.
18                 CHAIRPERSON TAYLOR:  Commissioner Cox, 
19   did you have anything you would like to add to this 
20   now, now that you've heard us rambling around?  
21                 COMMISSIONER COX:  No, I don't.  Thank 
22   you for catching me up.
23                 CHAIRPERSON TAYLOR:  Okay.  What is the 
24   will of the committee at this point?  
25                 MR. SANDERSON:  May I add one more 
0095
 1   comment to the latest discussion you had?  
 2                 CHAIRPERSON TAYLOR:  Yes.
 3                 MR. SANDERSON:  There is a provision in 
 4   the act and also I believe it's in the Internal 
 5   Revenue Code that use of proceeds while a licensed 
 6   authorized organization may not use proceeds to induce 
 7   or attempt to influence legislation.  So it would have 
 8   to be all personal money from the organization or from 
 9   individuals within the organization.
10                 MR. WEEKLEY:  So bingo funds cannot be 
11   used.
12                 CHAIRPERSON TAYLOR:  Okay.  We're going 
13   to take a break for the court reporter so she can rest 
14   her fingers.  But if it's okay with y'all, if -- we're 
15   pretty close to the end here, if we just work on 
16   through lunch and finish the meeting.  So meet back 
17   here in ten minutes.
18                 Okay.  We'll be back at 12:15.
19                 (Recess.)
20                 CHAIRPERSON TAYLOR:  It's almost 12:19 
21   right now, if I could call this meeting back to order.
22                 At this time, if the committee doesn't 
23   have a problem with it, I would like to skip on down 
24   to Item Number 11, report and possible discussion 
25   and/or action on the 2004 Bingo Advisory Committee 
0096
 1   annual report.
 2                 Kimberly and myself have been working 
 3   on this, and I'm going to go ahead and let her present 
 4   that to you.
 5                 MS. ROGERS:  Okay.  You would have 
 6   found in front of your seats this morning a paper just 
 7   like this right here (indicating).  I'll give 
 8   everybody a little second to find that now.
 9                 At the last meeting when we did the 
10   2004 annual report, we spoke only of gross figures; 
11   and as we all know, gross figures are really, really 
12   high and data.  Sometimes someone asks who was 
13   speaking in reference to net -- 
14                 CHAIRPERSON TAYLOR:  Let -- let me 
15   interrupt you just for a second.  Commissioner Cox 
16   specifically asked us that he would like us to add to 
17   our annual report the net proceeds.  So, this is in 
18   response to those who would like us to add this to our 
19   report. 
20                 MS. ROGERS:  And, as you notice, I 
21   marked it Item Number 5 from the last report.
22                 And we called this bingo net proceeds 
23   and expenses.  Then we have charts in the back.  As 
24   stated in the last report, gross receipts have 
25   increased by 29,124,481.  This is due to increased 
0097
 1   sales of event tickets.
 2                 In 2003 net proceeds were 24,906,610, 
 3   and in 2004 they were up to 27,008,922.  This is up by 
 4   2,048,362, again, thought to be in result of that of 
 5   event tabs that are more exciting and higher with 
 6   higher guaranteed pay outs.
 7                 This conclusion was reached by taking 
 8   figures directly from the bingo website, first adding 
 9   all the following expenses:  regular prizes, instant 
10   prizes, cost of goods sold, rent payments, mortgage 
11   payments, lease payments to distributors, and other 
12   expenses; secondly, subtracting the total expenses 
13   from gross receipts to give the net proceeds.
14                 These figures do not carry over the 
15   undistributed proceeds from the prior year in order to 
16   give a true net proceeds from the actual year.  It is 
17   also -- it also needs to be noted that bingo from -- 
18   oh, I'm sorry -- from the occasions -- bingo 
19   occasions -- I'm sorry -- were down by 2,358.  And 
20   persons attending was down by 1,151,543.
21                 These figures all show that increasing 
22   attendance by making patrons more aware of the 
23   excitement of charitable bingo along with making bingo 
24   more eventful and adding new games remains our key 
25   issue.
0098
 1                 And if Suzanne would like to talk about 
 2   the graphs we have in the back.
 3                 CHAIRPERSON TAYLOR:  What we did was 
 4   put these numbers on the graphs for the 2003 graph so 
 5   that we could compare it to 2004.  The biggest 
 6   difference, you'll see that the regular prizes for 
 7   2003 were 57 percent of the receipts.  And in 2004 
 8   they went down to 54 percent.  Well, the instant tabs 
 9   went from 16 percent up to 21 percent, obviously in 
10   relation to our selling the event tabs.
11                 The rest of the expenses remained 
12   pretty fixed.  Cost of goods sold remained at 2 
13   percent.  Rent payments remained at 6 percent.  
14   Mortgage payments were not -- they show zero percent 
15   because it was .004; so, it comes up as a zero 
16   percent.  The lease payments to distributors actually 
17   went down 1 percent, from 4 percent to 3 percent.  The 
18   expenses, other expenses went down a percent from 11 
19   percent to 10 percent.  And the actual net proceeds 
20   remained at 4 percent.
21                 Were there any questions?
22                 Commissioner?
23                 COMMISSIONER COX:  Suzanne, you 
24   certainly captured one of the things I think was 
25   important here.  Another thing, though, that I think 
0099
 1   is very important that you may want to consider for 
 2   future reports is capturing a number that I might call 
 3   net receipts.  And that would be the gross receipts, 
 4   which is ticket sales and pull-tab sales, and take 
 5   away from that prizes only.
 6                 CHAIRPERSON TAYLOR:  I'm sorry, sir.  
 7   Prizes only?  
 8                 COMMISSIONER COX:  Prizes only.
 9                 CHAIRPERSON TAYLOR:  Okay.
10                 COMMISSIONER COX:  So right now -- and 
11   I'm looking at page -- I'm going to look at the third 
12   page, 2003, because those are the numbers I added up.
13                 You are showing 575,000,000 in 
14   proceeds, and people think -- look at that and would 
15   say 24,000,000 net, 575 gross, wow, not much of an 
16   operation.
17                 But if you take the prizes away, 323 
18   plus 93, take -- the net receipts number is more like 
19   about 160,000,000.  And 24,000,000 out of 160,000,000 
20   is not bad.
21                 I don't know how exactly how this 
22   reporting model got adopted, but I'm wondering if it 
23   might have anything to do with the fact that we are in 
24   the same house with the Texas Lottery.  The Texas 
25   Lottery reports ticket sales as revenue, at $3.7 
0100
 1   billion.  Well, that's a real interesting number, but 
 2   you've got to pay your prizes before you get to any 
 3   consideration of what is available for the ultimate 
 4   beneficiary.
 5                 Now, if you were in Las Vegas or in 
 6   any -- any casino anywhere not that gross figure 
 7   because they don't have that number they don't know 
 8   how much was bet at the 21 table or the Black Jack 
 9   table or the baccarat table.  They know how much they 
10   won, and so that's the number that they report.
11                 Now, if you could play the number 
12   called net receipts, which would be gross receipts 
13   less prizes, you would be in sync with what the casino 
14   industry reports, not that you want to be.  But there 
15   are some pretty big bingo operations in the casino 
16   industry, and that's the way they are reporting.
17                 The other thing is I think that would 
18   benefit you from that is that I think that a lot of 
19   people, and perhaps some of them over at the capital, 
20   look at your proceeds, your receipts, and say, wow, 
21   proceeds are only what is that, under 5 percent, 3 
22   percent, must not be a very good operation, must be 
23   something going on.  It must be -- we must need to put 
24   some requirement on them for making some kind of 
25   minimum distribution because obviously they're -- the 
0101
 1   money isn't going where it needs to be going.
 2                 So, I think if you can work toward 
 3   focusing people on that wins less prizes per -- ticket 
 4   sales less prizes paid, that net number rather than 
 5   that great old big number, I think you're going to be 
 6   able to deal more effectively with some of these 
 7   questions.
 8                 MR. ATKINS:  Commissioner Cox.
 9                 COMMISSIONER COX:  Yes.
10                 MR. ATKINS:  I was just going to say by 
11   way of background of the reporting methodology was 
12   actually something that has been around since bingo 
13   has been around.
14                 COMMISSIONER COX:  Okay.
15                 MR. ATKINS:  And -- but since it's been 
16   here we have started to look at that net figure.  And, 
17   really, we started to go through the Sunset process, 
18   pulled that net figure out and comparing distributions 
19   to that after prizes.  It's still hard to get people 
20   off that gross figure; so, I think it's probably going 
21   to be a continual, you know, learning effort.
22                 COMMISSIONER COX:  Well, and -- and 
23   that number, since you have it historically, it's 
24   probably one that y'all look at.  And so it would 
25   require some -- some change on the part of management 
0102
 1   too.  But at least as far as external reporting goes, 
 2   to the extent that you have focused on that smaller, I 
 3   think you will be well-served.
 4                 Yeah.  Larry?  
 5                 MR. WHITTINGTON:  I'm in total 
 6   agreeance with you because, I think, number one is 
 7   people should know how many prizes were given away 
 8   this year.  That's number one.  First, that should be 
 9   said.  So-and-so and so-and-so, that was awarded in 
10   prizes in bingo -- 
11                 COMMISSIONER COX:  Okay.
12                 MR. WHITTINGTON:  -- then it goes to 
13   that second figure.
14                 COMMISSIONER COX:  Yeah.  You're right.
15                 MR. WHITTINGTON:  Then you go to the 
16   next one.
17                 COMMISSIONER COX:  That's a very 
18   important number -- 
19                 MR. WHITTINGTON:  Yes.
20                 COMMISSIONER COX:  -- how much the 
21   prizes were.  So that -- and to the extent that you 
22   would losing visibility of that, this would -- what 
23   I'm proposing would not be advantageous.
24                 MR. WHITTINGTON:  Exactly.
25                 COMMISSIONER COX:  Good point.
0103
 1                 Thank you, Suzanne.
 2                 CHAIRPERSON TAYLOR:  Thank you.  I -- I 
 3   absolutely agree with you too because, I mean, when 
 4   you take away this number, it does look like 4 
 5   percent.  It looks like such a small number than it -- 
 6   I actually wasn't sure it was right until we got the 
 7   notebook.  So I looked in the notebook and saw that 
 8   you had come up with 4 percent.  And we said, well, we 
 9   actually did it right.  We said, we came up with the 4 
10   percent.
11                 I do think that maybe we need to have 
12   two charts.  Maybe we should have the chart that shows 
13   the whole thing and another one that just shows 
14   everything else without the prizes in there.
15                 COMMISSIONER COX:  Yeah.  I think if 
16   you did two of these circles, these by charts, and 
17   then one of them with just the gross receipts, prizes; 
18   and then did this one from that, and that number pops 
19   up instead of being 4 percent, it's more like 16 
20   percent or 20 percent -- 
21                 CHAIRPERSON TAYLOR:  Right.
22                 MR. WHITTINGTON:  Right.
23                 COMMISSIONER COX:  -- I think that 
24   would be agreeable.
25                 CHAIRPERSON TAYLOR:  I agree.  We will 
0104
 1   do that on our next one.  Thank you.
 2                 Any other questions or comments?  
 3                 MR. WHITTINGTON:  I just want to add 
 4   one more.  He's right about the legislation because I 
 5   talked to those -- some of the house and Senate about 
 6   four years ago.  They were fixated on the gross 
 7   receipts and what bingo was giving to the charities.  
 8   And they were just blown away because they didn't 
 9   understand it, all this money and, you know, how can 
10   the charities get less money from all that gross 
11   receipts.  They was very concerned about it, that we 
12   didn't care about it.  That's why they backed off of 
13   bingo a lot.
14                 CHAIRPERSON TAYLOR:  Okay.  At the last 
15   meeting, the people on the work group who adopted the 
16   2004 annual report, and this would be in addition to 
17   that report that was requested.
18                 So at this time I'm looking for a 
19   motion to approve the 2004 annual report from the 
20   committee.
21                 MS. ROGERS:  I motion.
22                 CHAIRPERSON TAYLOR:  Kim makes that 
23   motion.  Is there a second?  
24                 MR. MANIO:  Second to motion.
25                 CHAIRPERSON TAYLOR:  Mario makes the 
0105
 1   second.
 2                 Is there any other discussion?  Then we 
 3   would like a vote.
 4                 All in favor?
 5                 THE COMMITTEE MEMBERS:  Aye.
 6                 CHAIRPERSON TAYLOR:  All opposed?  
 7                 Okay.  The 2004 annual report is now 
 8   finished.
 9                 Okay.  And we can go ahead and skip 
10   back over to Item Number 8, then, report and possible 
11   discussion and/or action on the status of nominations 
12   for filling the Bingo Advisory Committee position.
13                 Kimberly.
14                 MS. ROGERS:  Okay.  We did have one 
15   application for the distributor position which is 
16   Knowles Cornwell.  I myself would like to nominate him 
17   at this time.  That name is Knowles Cornwell in case 
18   you didn't get that.
19                 We had one applicant -- which I 
20   apologize.  The -- I did not get the nomination form 
21   to -- it came along in time -- would be Marky Weaver 
22   for the commercial lessor position of Mario, which we 
23   would like to nominate her at this time.
24                 Also at this time I received an e-mail 
25   from Suzanne Taylor that she would be willing to run 
0106
 1   another term for her position, and we have no other 
 2   commercial lessors at this time.  So, I would like to 
 3   nominate Suzanne Taylor for another time.
 4                 MR. WHITTINGTON:  I second, third, 
 5   fourth, fifth.
 6                 MS. ROGERS:  So Mr. Cornwell and 
 7   Ms. Weaver need to go through now -- will go through 
 8   their process making sure they fit the -- the part and 
 9   meet with the commissioners.
10                 CHAIRPERSON TAYLOR:  Are you asking 
11   from a motion from the committee to accept the 
12   nominations or --
13                 MS. ROGERS:  Yes, I am.
14                 CHAIRPERSON TAYLOR:  -- the 
15   recommendation from the nominating committee?  
16                 MS. ROGERS:  Yes, I am asking.
17                 CHAIRPERSON TAYLOR:  Okay.  Is there a 
18   motion?  
19                 MS. LOPEZ:  I make a motion.
20                 CHAIRPERSON TAYLOR:  Second?  
21                 MR. WHITTINGTON:  Second.
22                 CHAIRPERSON TAYLOR:  All in favor.
23                 THE COMMITTEE MEMBERS:  Aye.
24                 CHAIRPERSON TAYLOR:  Opposed?
25                 Okay.  Then the nominating committee 
0107
 1   will forward those recommendations to the 
 2   commissioners.
 3                 Item Number 9, report possible 
 4   discussion and/or action on public service announce -- 
 5   announcements.
 6                 MR. ATKINS:  Members, Bobby Heith 
 7   couldn't be here today.  Where the media relations 
 8   staff is at this time is they're waiting on 2005 
 9   figures to go final.  And then they will plug that 
10   into the public service announcement that you 
11   previously saw as well as translating that 
12   announcement into Spanish, and then those will be made 
13   available to media outlets.
14                 MS. LOPEZ:  How soon do you anticipate 
15   that?  
16                 MR. ATKINS:  Well, the figures --
17                 CHAIRPERSON TAYLOR:  To put it 
18   together.
19                 MR. ATKINS:  -- for 2005 will be final 
20   the 22nd.  They already have the translation.  All 
21   they need to do is plug in the figures.  And I think 
22   it, you know, will be a matter of weeks, if that long.
23                 MS. LOPEZ:  Like the first quarter of 
24   this year or...
25                 MR. ATKINS:  I would say by the first 
0108
 1   or second week of March.
 2                 CHAIRPERSON TAYLOR:  Is there any other 
 3   discussion?
 4                 Then we will move on to Item Number 10, 
 5   report possible discussion on the status of Bingo 
 6   Caller of the Year.
 7                 Rosie.
 8                 MS. LOPEZ:  Oh, cool.  You've got it up 
 9   on the screen.
10                 At the last BAC meeting there was some 
11   interest in possibly putting together a draft of a 
12   particular program that, again, would attract 
13   attention to the charitable bingo industry.  And with 
14   that, myself, Mario, and Kim have worked together on 
15   this particular Bingo Caller of the Year contest.  
16   It's just a few -- I think it's like four slides of 
17   this particular draft of proposed Bingo Caller of the 
18   Year contest.
19                 And basically what we came up with was, 
20   again, a mission statement to identify the purpose of 
21   having a Bingo Caller of the Year contest, and, again, 
22   our goal:  to increase the attendance of the bingo 
23   players through their involvement.
24                 MR. ATKINS:  And you'll just have to 
25   tell me when you want me to change --
0109
 1                 MS. LOPEZ:  Okay.
 2                 MR. ATKINS:  -- the slide.
 3                 MS. LOPEZ:  Okay.  And we can move on 
 4   to the next slide.
 5                 We came up with some guidelines.  
 6   Basically again caller must be a Texas resident 
 7   obviously.  Caller has to be nominated by any of the 
 8   following, which would be either a bingo player, a 
 9   charity representative, lessors, and/or distributors.  
10   In order to enter into the contest there would have to 
11   be a completed application, including a VHS tape.  And 
12   again this is just a deadline that we came up with 
13   hoping that we can meet that deadline, to be submitted 
14   by July the 15th of this year so that we can have 
15   award entries in by that particular deadline.  And 
16   again late entries would not be considered for this 
17   particular year.
18                 In the marketing, the contest would be 
19   based on regions and we felt that we could probably 
20   utilize the same TLC regions where the way that -- you 
21   know, that the regions are sectioned off to be able to 
22   base this particular contest on those regions.
23                 Again, each region would have at least 
24   two regional contest representatives.  And those 
25   representatives would be comprised of at least one BAC 
0110
 1   member and one at large member within their region.  
 2   It could be a charity representative, a lessor, 
 3   distributor, manufacturer, someone of that particular 
 4   entity to assist B -- the BAC member.
 5                 The contest rules and applications 
 6   would in -- if the TLC would allow us to feature them 
 7   on the charitable bingo website for this particular 
 8   marketing aspect.  The contest rules and applications, 
 9   again, target date would be that we would mail them 
10   out April 1st, along with the quarterly reports that 
11   go out to every organization in Texas.  And then the 
12   second mailing of the contest rules and application 
13   would occur again on June 1st, which would be the 
14   third quarter report that is sent out to all the 
15   charities.
16                 The applications would be reviewed by 
17   the original contest representatives, and the regional 
18   contest finalists would be reviewed by the entire 
19   panel of the regional contest representatives on July 
20   the 15th of this year.  There would be, hopefully, the 
21   top three state finalists would be judged by the 
22   entire panel of the representatives on August the 15th 
23   at Circus Bingo in San Antonio.
24                 One of the important, I think, factors 
25   for any type of program, of course, is always the 
0111
 1   funding and how we are going to fund this particular 
 2   program.  I think our committee agreed upon the fact 
 3   that the funds for this contest would focus basically 
 4   on sponsorships or underwriters from Texas 
 5   manufacturers, distributors, lessors, and that the 
 6   representatives, the regional contest representatives 
 7   would be responsible for obtaining the funds for the 
 8   program.
 9                 That's the marketing.  On the awards, 
10   there would be statewide -- statewide recognition for 
11   this particular program.  The winner -- or the 2006 
12   Bingo Caller of the Year would receive a gold bingo 
13   microphone trophy, which we would obviously have to 
14   have made or designed uniquely for this particular 
15   recipient.  The recipient would also receive a three-
16   day trip for two to Las Vegas, hotel and airfare only, 
17   obviously; also, recipient of $300 cash, which 
18   obviously could be used for food or entertainment.  
19   And then the winner would also be involved in 
20   selecting the next year's Bingo Caller of the Year, if 
21   he or she -- he or she chooses to.
22                 Second place winner in the contest 
23   would receive $200 cash and a framed certificate, and 
24   then your third place winner would receive $100 cash 
25   and a framed certificate.
0112
 1                 And on the budget, which is the next 
 2   slide, we came up with -- there would have to be a 
 3   post office box set up at one of the representatives.  
 4   Or the judging representatives would set up a post 
 5   office box so that all the entries will be mailed to 
 6   the post office box.
 7                 And this particular -- I have to tell 
 8   you this particular postage -- I put this together 
 9   back in December before the mail come -- or post 
10   became -- post -- postage became 39 cents.  So that's 
11   a little flaw in there.  There's a little increase in 
12   that.  For two mailings of approximately 2,000 at, 
13   say, 39 cents each, there's a little discrepancy.  Now 
14   on the 1560 that I have allotted, we go up a few 
15   dollars on that.
16                 Paper and printing for this particular 
17   program with again estimated budget of $500.
18                 The judges.  There would be five 
19   judges, one night, hotel cost as a regional -- to 
20   provide the regional judging would be about $500, if 
21   you, I guess, trying to be as conservative here as we 
22   possibly can, assuming that hotels would cost us about 
23   a hundred dollars a night.  And then again the 
24   judges -- the five judges would have one more night in 
25   a hotel for the finalist, which would be at Circus 
0113
 1   Bingo in San Antonio.  And, again, we're being 
 2   conservative, $500.  And the contest cash prizes is 
 3   about $600.  The trophy and certificates, again, about 
 4   $200.  And the contest trip which would include the 
 5   airfare and hotel for two, we're estimating at about 
 6   $2,000.
 7                 So right now the total estimated cost 
 8   added up -- a little typo -- is $5,980 is what we're 
 9   looking at to underwrite this particular Bingo Caller 
10   of the Year program.  Again, this is just a proposed 
11   concept of hopefully, I guess, attracting more 
12   attention to bingo and really just bringing, I think, 
13   more enthusiasm to the staff, the bingo callers that 
14   work at our halls.
15                 You know, they -- they -- they put up 
16   with a lot, not only bingo callers but all staff.  And 
17   I think that just bringing recognition to a particular 
18   bingo caller at -- you know, at one of our bingo halls 
19   throughout the State of Texas, I think, would be 
20   something that would, I think, very unique.  And maybe 
21   at some point this particular program could be modeled 
22   in other states.  Again, it would -- we would have to 
23   take it step by step but build up on it to where we 
24   could actually become a model state program that could 
25   be used in other states.
0114
 1                 MS. ROGERS:  I have -- I have a 
 2   question in reference to this.  And, Billy, you may be 
 3   able to answer that.  I don't know.
 4                 We discussed maybe being able to send 
 5   out the application rules, et cetera, along with the 
 6   quarterlies, would that be possible to where that 
 7   would save us the postage?  Is that something that 
 8   could be possible, or are you limited to you can only 
 9   put so many papers in there?
10                 MR. ATKINS:  Yeah.
11                 MS. ROGERS:  Or can you check on that 
12   for us?  
13                 MR. ATKINS:  I'm going to need to check 
14   on that --
15                 MS. ROGERS:  Okay.
16                 MR. ATKINS:  -- Kimberly.  Actually 
17   Phil and I were talking about this, this morning.  And 
18   what we'll need to do is probably get together with 
19   Sandy.
20                 MS. ROGERS:  Right.
21                 MR. ATKINS:  And go over some things.  
22   I don't know if we could just include it, if -- if 
23   that would change the cost of our normal mail out.
24                 MS. ROGERS:  Right.  Or maybe we could 
25   figure in to pay the difference, which already costs 
0115
 1   you 39 cents to mail -- 
 2                 MR. ATKINS:  And --
 3                 MS. ROGERS:  -- it would cost you two 
 4   more cents, you know, something to that nature.
 5                 MR. ATKINS:  That's -- that's one of 
 6   the things we discussed.  So on that item, yeah, we 
 7   would need to do a little further research on that.
 8                 MS. ROGERS:  Okay.  Thank you.  
 9                 MR. ATKINS:  And the same, I guess, in 
10   terms of actually posting it on our website.  We would 
11   just want to make sure that we've discussed that 
12   thoroughly with Sandy beforehand.
13                 MS. ROGERS:  And one thing.  We might 
14   need to change is complete applications including VHS 
15   DVD.
16                 MS. LOPEZ:  DVD.  Right.
17                 MS. ROGERS:  Because a lot of people 
18   don't have VHS anymore.  They have a DVD.
19                 MR. ATKINS:  You might -- you know, one 
20   other thing you might think and actually think about 
21   in connection with your judges is if you have 
22   individuals that actually submit it electronically; 
23   that is, you know, e-mail a small video clip instead 
24   of sending an actual DVD or VHS.  
25                 MS. LOPEZ:  Where it can be e-mailed.
0116
 1                 MR. ATKINS:  Yeah.  And you might also 
 2   consider, in terms of your sponsorship, looking to -- 
 3   the first publication that comes to mind is the Bingo 
 4   Bugle that I know is in a number of halls throughout 
 5   the state.  They may be interested in something like 
 6   that.
 7                 And finally the last comment, you know, 
 8   that we had on the top prize:  you know, why send 
 9   someone out to Las Vegas --
10                 MS. LOPEZ:  Las Vegas.  I know we're 
11   sending them out of state.
12                 MR. ATKINS:  -- you know, as the 
13   prize.  You know, why not send them on a tour around 
14   the state with the opportunity, you know, to appear in 
15   other halls and hopefully the opportunity, you know, 
16   for that hall in their local area to generating some 
17   excitement, you know, their media and their local 
18   players.
19                 MS. LOPEZ:  Oh, wow.
20                 MS. ROGERS:  You know, there's things 
21   that I wanted -- you know, we are talking about how 
22   other states have all the -- the gaming that we don't 
23   and --
24                 MS. LOPEZ:  We're sending someone out 
25   of here.
0117
 1                 MR. ATKINS:  Yeah.
 2                 MS. ROGERS:  Yeah.  We're sending 
 3   someone out of here.
 4                 MS. LOPEZ:  It's just a draft.  Okay.  
 5   That's why it's a draft, idea.
 6                 CHAIRPERSON TAYLOR:  In your draft, you 
 7   might also want to say that their tape or whatever 
 8   they submitted, they don't do it, via e-mail, that we 
 9   would not return those.
10                 MS. LOPEZ:  Okay.
11                 MS. ROGERS:  Right.
12                 MS. LOPEZ:  They become property of 
13   the ours, I guess.  
14                 CHAIRPERSON TAYLOR:  Yes.
15                 MR. DOUGHERTY:  I have a question as to 
16   the media, to how does the average bingo player get 
17   involved in voting at all.
18                 MS. LOPEZ:  We didn't show --
19                 MS. ROGERS:  Yeah.
20                 MS. LOPEZ:  -- the application.  I'm 
21   sorry.  I've got an application.
22                 MS. ROGERS:  I think that just 
23   announcing each --
24                 MR. ATKINS:  It's in the --
25                 MS. LOPEZ:  -- I guess.  I'm sorry.
0118
 1                 MR. ATKINS:  It's in the notebook.  
 2   It's the last item in the notebook -- 
 3                 MS. LOPEZ:  Right.  It's an 
 4   application.
 5                 MR. ATKINS:  -- the application.
 6                 MR. DOUGHERTY:  Oh.  I don't see an 
 7   application.
 8                 MS. ROGERS:  I don't have an 
 9   application.
10                 MR. ATKINS:  Am I the only one that got 
11   one?
12                 MS. ROGERS:  I don't know.
13                 MS. LOPEZ:  Yeah.  The application is 
14   not in here.
15                 MS. ROGERS:  Is it on the -- is it on 
16   the Power Point?  
17                 MR. ATKINS:  It's not on the Power 
18   Point.
19                 MS. ROGERS:  Well, there is an 
20   application.  I promise.  It looks like this.
21                 MR. WHITTINGTON:  Well, how long does 
22   this take, this DVD, them calling a bingo game or how 
23   long -- how long is that?  
24                 MS. LOPEZ:  And I think we probably 
25   need to limit it.  I thought we would limit it to a 
0119
 1   one- to five-minute video, but we had said that.  
 2   Obviously that's not on here again.
 3                 MR. WHITTINGTON:  Of them calling a 
 4   bingo game or what?
 5                 MS. LOPEZ:  Yeah.
 6                 MS. ROGERS:  Well, I think -- I 
 7   think -- 
 8                 MR. ATKINS:  It --
 9                 MS. ROGERS:  -- well, I think we talked 
10   about --
11                 MR. ATKINS:  Sorry.  It says on the 
12   application no more than three minutes.
13                 MS. LOPEZ:  Three minutes.  Okay.
14                 MS. ROGERS:  And I think we'll leave 
15   that up to -- to their choice because, you know, a lot 
16   of callers feel they call horse race better than they 
17   call the bingo game.  Or, you know, their -- their 
18   time, three minutes, show us what you can do.  You 
19   know, whether it be -- you can do video game.  You can 
20   do a game.
21                 MR. WHITTINGTON:  Okay.  But I just 
22   wanted to --
23                 MS. ROGERS:  Yeah.
24                 MR. WHITTINGTON:  -- get some 
25   clarification on what they do on this video.
0120
 1                 MS. LOPEZ:  And I think on the 
 2   application there was more specifics of like how the 
 3   customer would get involved in nominating that Bingo 
 4   Caller of the Year.  And that's something that again 
 5   would -- that's something that each individual hall, 
 6   if they're interested, would take it upon themselves 
 7   to promote that to their customers.  Hey, you know, 
 8   we're going to have a statewide contest.  If you 
 9   wanted to nominate J.P., you know, as Bingo Caller of 
10   the Year, here's a form; hand it out to your 
11   customers; say, nominate this person, why you think, 
12   you know, he's a great caller in our hall.
13                 MS. ROGERS:  And Rosie made an 
14   application.  I'll let Rosie read it to you.
15                 MS. LOPEZ:  And basically, yeah, you 
16   list the caller's name, all the contact information, 
17   the bingo hall where this particular bingo caller is 
18   located at, and the nominator's name, you know, the 
19   customer, you know, A.  They put their name in there, 
20   a relationship, whether they are a bingo customer or 
21   charity representative, a lessor, manufacturer -- it 
22   could be a family friend -- also their contact 
23   information.  And then basically you're asking the 
24   nominator to provide a statement in 50 words or less, 
25   why I nominate this person to be the bingo caller of 
0121
 1   the year.
 2                 Factors for nomination would be quality 
 3   of voice, clearless -- clearance, enunciation, 
 4   friendliness, et cetera; the pacing; the time and 
 5   interval between balls being called -- I guess, that's 
 6   if it's again a bingo game; content of opening 
 7   statements; attentiveness to bingo players.
 8                 CHAIRPERSON TAYLOR:  You know, I would 
 9   like to make one other suggestion.  If -- if you are 
10   doing it to get more interest in bingo -- I mean, 
11   we're working it towards that end -- maybe the 
12   nomination after somebody is nominated -- and I -- and 
13   I'm not trying to change your -- your thoughts and 
14   stuff -- but maybe you should just ask for nominations 
15   and then you contact those that are nominated to see 
16   if they are interested in participating because then 
17   they would need to send in a VHS tape, because a 
18   customer is not going to go up there with a recorder 
19   and camcord these people calling.
20                 MS. ROGERS:  Sure.
21                 MS. LOPEZ:  After they have been 
22   nominated.
23                 CHAIRPERSON TAYLOR:  You know, maybe 
24   they need to be nominated and then if they are 
25   interested in participating in this contest, then you 
0122
 1   can submit a tape or one of these.
 2                 MR. MANIO:  Also, if -- if I heard Jack 
 3   correctly, he wanted to know how we can promote this 
 4   to be among bingo players.
 5                 Was that -- was that your question?  
 6                 MR. DOUGHERTY:  Well, yes.  And I'm 
 7   thinking of that nominees are going to be representing 
 8   a region.  Now, the regions are very large.  There's 
 9   five of them, right?  And then those five 
10   representative I suppose compete to be the caller, 
11   one, two, and three.
12                 MR. MANIO:  Okay.  Well, I --
13                 MR. DOUGHERTY:  But obviously thousands 
14   and thousands of bingo players, if they ever know all 
15   these participants.
16                 MR. MANIO:  Oh.  I -- I think Billy 
17   mentioned one of the other.  He said we can use this 
18   to promote this among bingo players are the bingo 
19   magazine, like the Bugle.  We don't have the Bugle 
20   in -- in Dallas.  We have the Bonanza and News Line.  
21   But we can publish this for, you know, two consecutive 
22   months in the bingo magazine because the -- the 
23   players do not get the respondents from the Lottery 
24   Commission, but they do deal with the bingo magazine 
25   every day.
0123
 1                 MS. LOPEZ:  And, again, this time line 
 2   was just set for this particular meeting, but that's 
 3   not set in stone.  I think it's because there's, you 
 4   know, a lot of different ideas and a lot of different 
 5   concepts that will be incorporated in the final.
 6                 I don't personally believe that we are 
 7   ready to proceed with this.  I think that there needs 
 8   to be, you know, some more tweaking to make it -- 
 9   because we want it to be successful obviously so 
10   that's, I think, again, to kind of bounce off some 
11   ideas off of everyone that would want to be involved 
12   in this to be able to make it, you know, a successful 
13   program statewide.
14                 MR. DOUGHERTY:  I do know that in 
15   England, it's very popular, where they -- they go 
16   crazy over there.  And how they disseminate that 
17   information, I don't know.  But they -- they sure do 
18   like it over there in England.
19                 CHAIRPERSON TAYLOR:  I think not -- 
20   notifying them through the mail, you know, with their 
21   regular bingo items that they're receiving because 
22   everybody opens the letters from the Lottery 
23   Commission.  That's the first thing you pull open if 
24   you get one in the mail.  So, I mean, being able to 
25   note it in the letter I think is a great way of 
0124
 1   getting the thing along the outlying areas to 
 2   companies who don't have Bugles or any other papers 
 3   with the little -- but they're all going to get that.  
 4   And if there's something on the website that they 
 5   could, you know, take off the website and post in 
 6   their halls for their bingo players to see, then you 
 7   are still serving getting the bingo patrons' interest 
 8   in nominating a favorite caller.
 9                 MR. WHITTINGTON:  And when these tapes 
10   come in, do y'all got a select group of people to look 
11   at these and determine who -- who's going to be 
12   nominated to be -- represent their region, right? 
13                 MS. LOPEZ:  It's going to be the actual 
14   contest representatives.
15                 MR. WHITTINGTON:  No.  I mean, how many 
16   people are going to be judging.
17                 MS. LOPEZ:  Each region will have at 
18   least two.  So that means there's going to be a total 
19   of ten, ten people you are looking at the.  You would 
20   have at least one person from a BAC member -- I mean, 
21   one BAC member and then one at large person, and I bet 
22   you that's the incentive.  We did not identify that in 
23   here, but that BAC member would probably go to, you 
24   know, either a charity representative board member or 
25   someone else that could assist the BAC member in being 
0125
 1   the judge for this particular contest -- 
 2                 MR. ATKINS:  You might --
 3                 MS. LOPEZ:  -- or a custom.
 4                 MR. ATKINS:  Just to throw this out.  
 5   You might think somewhere along the lines of American 
 6   Idol and having three judges in case, you know, you 
 7   have a tie, if it turns out, you know, that they like 
 8   someone, you can move forward, unless they have 
 9   someone like Simon.
10                 MR. MOORE:  Or Paula.
11                 MR. ATKINS:  Paula.  Yeah.  We would be 
12   on that committee.
13                 MS. ROGERS:  Y'all, and -- and we're 
14   still looking.  There may be -- I think we 
15   discussed -- there may be some way in order to have 
16   more customer input where we get this -- somehow give 
17   out tickets when they are nominated, you know, because 
18   we all live in different -- all of us live in 
19   different areas or regions, which is a good thing.  
20   But maybe the person can go to their hall in their 
21   region and that -- because that caller was nominated, 
22   let them know prior, you know, that the customers can 
23   come in and to somehow figure out some kind of voting 
24   system or something.  I don't know.  You just have to 
25   be very careful.  I think we want to be very careful 
0126
 1   that we can't just turn it loose and say, okay, 
 2   everybody vote.  There has to be a way that you can 
 3   oversee it.  So we are still thinking along that line.
 4                 MR. WHITTINGTON:  I think the customers 
 5   should come more into play -- 
 6                 MS. ROGERS:  Right.  Exactly.
 7                 MR. WHITTINGTON:  -- after you pick the 
 8   certain people that's going to go to the region, then 
 9   you play out -- now you put down ten or 15 people.  
10   They -- they can do the voting.
11                 MS. ROGERS:  Right.  Exactly.  And if 
12   we can figure that out to where, you know, the -- the 
13   ten judges can go and sit and watch the person, if 
14   that's possible.  And how do we plug it in.  You know, 
15   they let people know all week long, hey, Jack is going 
16   to be in this contest.  On Saturday he's calling a 
17   game or shooting the video, can y'all come and give 
18   your support.  Well, more people in the hall, more 
19   people playing, more people voting for their 
20   individual too.
21                 I see it in -- in our halls where we 
22   play.  Individual bingo customers like their callers.  
23   They know -- if you give them a set schedule when 
24   their callers are going to call, they're going to be 
25   there that night, not when someone else is calling.   
0127
 1   They get attached to their callers.  So and that's the 
 2   whole purpose of this, to get them involved and coming 
 3   into bingo.  So if we can, we are trying to work that 
 4   angle because it is the whole purpose of getting the 
 5   people in.
 6                 MR. WHITTINGTON:  What's everybody 
 7   going to say to get in?  Is it going to depend on 
 8   merit at all?  They could pick.
 9                 MS. ROGERS:  What?
10                 MR. WHITTINGTON:  And they -- they 
11   dismiss a few and then all of a sudden now you've got 
12   a prime few left and the --
13                 MS. ROGERS:  Right.
14                 MR. WHITTINGTON:  -- and the people are 
15   involved, you know.  This is one of their services.
16                 MS. ROGERS:  Exactly.  Right.  
17                 MR. WHITTINGTON:  So that's what it 
18   should be, not make-ups.  Just because somebody love 
19   to call at that hall, other people in the region might 
20   not like the caller --
21                 MS. ROGERS:  That's true.
22                 MR. WHITTINGTON:  -- in the other area.
23                 MS. ROGERS:  That's true.
24                 MR. WHITTINGTON:  Exactly.  That's how 
25   it should be.
0128
 1                 MS. ROGERS:  Well, and that's what we 
 2   talked about.  I think we said in here too, having 
 3   a -- a final -- you know, an actual bingo session and 
 4   letting these different callers call it, where the 
 5   people get to come and play and vote for the person, 
 6   which can be more of a -- 
 7                 MS. LOPEZ:  Have actual customers that 
 8   are there during that bingo session actually pick a 
 9   winner.  I mean, that again -- 
10                 CHAIRPERSON TAYLOR:  Good work.
11                 MR. DOUGHERTY:  Have you clarified who, 
12   how you choose the judges.  These judges have to see 
13   everything within that region.  How are they going to 
14   be chosen?  Are they going to be volunteers, or is 
15   there going to be a judges selection?  
16                 MS. LOPEZ:  Pretty much volunteer.
17                 MR. DOUGHERTY:  Volunteer.  Not -- not 
18   caller but the judges.
19                 MS. LOPEZ:  Right.
20                 MR. DOUGHERTY:  How -- how do you 
21   choose?  
22                 MS. ROGERS:  But I think we can post 
23   it.  We -- 
24                 MS. LOPEZ:  We can post it.  It would 
25   be at least -- for every region there would one BAC 
0129
 1   member.  So I believe it would --
 2                 MS. ROGERS:  Right.
 3                 MS. LOPEZ:  -- be one out of every 
 4   region.  So there would be five of us, each 
 5   representing one particular region.  Then it's up to, 
 6   you know --
 7                 MS. ROGERS:  We need another too --
 8                 MS. LOPEZ:  -- me to get someone to 
 9   assist me in my region.
10                 MS. ROGERS:  That you would think would 
11   rely on and the trust of the BAC members to pick 
12   someone -- choose someone that's going to be -- 
13   "impartial" is the word I'm looking for -- and to look 
14   at everyone.
15                 MR. WHITTINGTON:  Right.  Somebody has 
16   to do it, and that's going to be a job -- 
17                 CHAIRPERSON TAYLOR:  I know.
18                 MR. WHITTINGTON:  -- right.  We'll get 
19   Suzanne to do that.
20                 CHAIRPERSON TAYLOR:  No.  What I'm 
21   thinking is that I think it would be easier having a 
22   BAC member be a judge for a different region.  But to 
23   judge your own region --
24                 MR. WHITTINGTON:  Right.
25                 CHAIRPERSON TAYLOR:  -- I think that -- 
0130
 1                 MR. DOUGHERTY:  A little prejudiced.
 2                 CHAIRPERSON TAYLOR:  I think so.
 3                 MR. WHITTINGTON:  You know, in my hall 
 4   I got all the people who work for me, 22 people, they 
 5   all callers.  They got to call.  That's one of the 
 6   stipulations.  Everybody got to call.
 7                 MS. ROGERS:  But you would be -- but 
 8   you would be -- it's going to be rather difficult for 
 9   me to go and judge Dallas if I'm --
10                 MR. WHITTINGTON:  Well, you're not -- 
11                 CHAIRPERSON TAYLOR:  You're judging 
12   the tapes, I mean...
13                 MR. WHITTINGTON:  -- you're judging the 
14   tapes.
15                 MS. ROGERS:  Right.
16                 CHAIRPERSON TAYLOR:  The tapes is where 
17   you're getting your finalists, and the finalists are 
18   going to go call in Circus Bingo.  Is that now how 
19   I --
20                 MS. ROGERS:  Yes.
21                 CHAIRPERSON TAYLOR:  -- I understood 
22   this to be?  
23                 So, I mean, what you're asking is if 
24   somebody is going to look at a tape, then I really 
25   think that the BAC members are going to be judging it, 
0131
 1   they should not be a judge for their own region -- 
 2                 MR. WHITTINGTON:  Right.  I mean --
 3                 CHAIRPERSON TAYLOR:  -- they should 
 4   look at tapes from other regions.
 5                 MR. WHITTINGTON:  I think that's how it 
 6   should be.
 7                 MS. LOPEZ:  I -- I think that's 
 8   probably why we have a post office box because I 
 9   thought we had originally, I guess, gone back to the 
10   fact that if you were going to submit an application, 
11   you would go ahead and submit a DVD or VHS, and then 
12   that's when the judges would come together -- 
13                 MS. ROGERS:  They come together and 
14   watch.
15                 MS. LOPEZ:  -- and everyone would look 
16   at --
17                 MS. ROGERS:  -- all of the --
18                 MS. LOPEZ:  -- the DVD or VHS and at 
19   that point is when the decisions would be made for 
20   the -- that would be like a semi-finalist.  Then you 
21   move onto the finalist.  And then that's when the 
22   customers playing bingo would actually pick the 
23   winner.
24                 MS. ROGERS:  Because I don't think -- 
25   you can imagine how these tapes and DVDs will be when 
0132
 1   you sit down and start watching them.  We don't even 
 2   know what is going to be on there, what region they 
 3   are from.
 4                 MR. WHITTINGTON:  Well, they've got to 
 5   say that first.  They'll say, I'm from so-and-so and 
 6   so-and-so.  So you know on the tape right away, they 
 7   are from Dallas, they are from -- say it at the 
 8   beginning of this DVD.  They need to announce where 
 9   they are from so you know where they are from.
10                 MS. LOPEZ:  I think that would be 
11   attached to the actual application that has all that 
12   information to it.  Yeah.
13                 CHAIRPERSON TAYLOR:  Well, it looks 
14   good.
15                 MR. WHITTINGTON:  Yeah.  I do too.
16                 CHAIRPERSON TAYLOR:  I'm glad to see 
17   the work was done on it.
18                 MS. LOPEZ:  My question to the BAC is:  
19   Does anyone want to be involved in this?  I mean, is 
20   it something that is important -- I shouldn't say 
21   important -- something that we want to look at in 
22   doing to bring additional attention to bingo or is 
23   this something that is maybe too cumbersome for any of 
24   us to -- take -- undertake and do we have the time?  I 
25   mean, everyone here has a platter full of work to do.  
0133
 1   Is this something that we want?  
 2                 MR. WHITTINGTON:  Billy, don't you have 
 3   time after 6:00 o'clock to look at all these tapes.
 4                 MR. MOORE:  Rosie, I think -- I think 
 5   your -- the timing is too aggressive.  We got six 
 6   weeks to -- first of all, you've got to get the 
 7   funding together.  You've got to contact distributors, 
 8   manufacturers, lessors.  Because without that -- 
 9                 MS. LOPEZ:  Nothing happens.
10                 MR. MOORE:  -- we can't put this in 
11   place.
12                 MS. LOPEZ:  Right.
13                 MR. MOORE:  Maybe you need to focus on 
14   the end of the year, I mean, just to give yourself 
15   another two or three months to get it together and see 
16   if we can either pull the money together, for one.
17                 CHAIRPERSON TAYLOR:  You're not 
18   volunteering the money?
19                 MR. MOORE:  Not yet.
20                 MS. ROGERS:  That's what he's been 
21   trained to say.  You can -- 
22                 MR. MOORE:  No, I do -- I do -- 
23                 MS. ROGERS:  You can give it.
24                 MR. MOORE:  -- know what you're saying, 
25   though.  But I -- you know, again, I need to make sure 
0134
 1   that I can do it going through this process and 
 2   everything and TLC.  So I just think we need to look 
 3   at those things first.
 4                 MR. WHITTINGTON:  I think the executive 
 5   producer would be great more with enterprises like 
 6   you.
 7                 MR. MOORE:  Yeah.  Enterprises.  
 8                 CHAIRPERSON TAYLOR:  Rosie, is there -- 
 9   would there be a fund that you would look for 
10   donations through?  Are you setting up some kind of a 
11   fund?  I mean, who's going to be paying the -- the 
12   money, if you go -- 
13                 MS. LOPEZ:  That's being determined.
14                 CHAIRPERSON TAYLOR:  -- and -- and 
15   Danny wants to volunteer $5,000 to get this off the 
16   first year, where would you put that money?
17                 MS. LOPEZ:  I think that's something 
18   that we just really didn't disclose on this particular 
19   Power Point.  But at that point when the five BAC 
20   members along with their assistants -- I'm going to 
21   call it this time -- there would be, I think, someone 
22   that would be appointed as a treasurer for setting up 
23   an account to receive all the monies coming in from 
24   particular underwriters in the program.  So, yes.
25                 MR. DOUGHERTY:  You did -- you didn't 
0135
 1   say money coming from manufacturers, distributors, and 
 2   lessors.  Is that finite, or can players donate 
 3   something?  Or is that really not -- is that too 
 4   political?  
 5                 MS. LOPEZ:  Anyone that wants to donate 
 6   money to make the program work.
 7                 MR. DOUGHERTY:  It doesn't put the 
 8   financial burden on these three groups.  Now, is 
 9   that -- is that finite?  Or can bingo halls collect a 
10   certain amount of donations from the players?  
11                 MS. ROGERS:  Well, I think bingo halls 
12   if they want to collect, they could.  I guess.  I 
13   don't know legally or whatever.
14                 MR. DOUGHERTY:  They wouldn't be barred 
15   from it, would they?
16                 MS. ROGERS:  I don't know that.  I know 
17   Phil is standing --
18                 MR. DOUGHERTY:  Oh.
19                 MS. ROGERS:  -- up at the podium.
20                 MS. LOPEZ:  Oh.
21                 MS. ROGERS:  But what I was going to 
22   tell, if their -- if their caller got nominated, they 
23   could collect to send him to wherever -- 
24                 MR. DOUGHERTY:  That was --
25                 MS. ROGERS:  -- he went.
0136
 1                 MR. DOUGHERTY:  -- that was my point.
 2                 MS. ROGERS:  Right.
 3                 MR. DOUGHERTY:  Bingo halls could sort 
 4   of get behind their caller.
 5                 MR. SANDERSON:  The make-up of your 
 6   judges, I think if you've got five BAC members 
 7   together, that would constitute an open meeting 
 8   because it would be a quorum.  So you may want to go 
 9   with four regions or something of that nature.
10                 MR. DOUGHERTY:  What region are you 
11   going to eliminate?  
12                 CHAIRPERSON TAYLOR:  Well, perhaps is 
13   there a reason that one of the Lottery Commission 
14   members couldn't be one of those judges?  
15                 MR. WHITTINGTON:  Yeah.  Like you.
16                 CHAIRPERSON TAYLOR:  To make up that 
17   fifth number.
18                 MR. WHITTINGTON:  I'm serious.  I'm 
19   serious.  Really.  I think it would be fun.
20                 MR. DOUGHERTY:  Or Commissioner Cox.
21                 MR. WHITTINGTON:  I think it would 
22   really be fun.
23                 CHAIRPERSON TAYLOR:  I -- I think that 
24   there's -- there's a lot more work --
25                 MS. LOPEZ:  Right.
0137
 1                 CHAIRPERSON TAYLOR:  -- that needs to 
 2   be done by the work group   The committee has brought 
 3   up several, you know, things.  And if you guys can put 
 4   that into your plan, and I agree with it, you know.
 5                 We need to obviously -- we're putting 
 6   something together you can't jump into.  I mean, this 
 7   is a big deal. Work group to meet again and come to 
 8   the next meeting and hopefully to address the items 
 9   that we talked about today and have some of these 
10   questions answered.
11                 If there was anything else for the work 
12   group at this time?  Any public comment?  If not, 
13   we'll hear about -- more about this at our next 
14   meeting.
15                 And we'll go on to Item Number 12, 
16   report and possible discussion and/or action on the 
17   2005 Bingo Advisory Committee and annual report.
18                 What we need to do is set up a 
19   committee at this time to work on the 2005 annual 
20   report and hopefully have it back a lot quicker than 
21   we got the 2004 report back.
22                 So do I have any volunteers besides 
23   Kimberly to work on this?
24                 Rosie, did you want to work on that 
25   too, or is your plate pretty full with the other 
0138
 1   thing?
 2                 MS. LOPEZ:  Yeah.  I guess I better... 
 3                 CHAIRPERSON TAYLOR:  Mario.
 4                 MR. MANIO:  Yes, ma'am.
 5                 CHAIRPERSON TAYLOR:  You're still a 
 6   member.  Are you interested in working on this 
 7   report?  
 8                 MR. MANIO:  Yeah.  I'm okay.
 9                 CHAIRPERSON TAYLOR:  And one more 
10   person.  This is the time for volunteers.
11                 MS. ROGERS:  You yourself will stay on, 
12   correct, Suzanne?  
13                 MR. WHITTINGTON:  Yeah.  Suzanne.
14                 CHAIRPERSON TAYLOR:  Yes, I'll stay on 
15   this one.  And then, I guess, Larry, then you wanted 
16   to help too, right?
17                 MR. WHITTINGTON:  Yeah.
18                 CHAIRPERSON TAYLOR:  Okay.  So this 
19   committee will be Kimberly, Mario, myself, and Larry.  
20   And we will -- the issues we're going to speak of:  
21   what's requested of us is the gross receipts, 
22   charitable distributions, expenses, attendance, and 
23   any other area requested by the commission.  And since 
24   the net proceeds were requested, we'll go ahead and 
25   have that on the report.  And I will ask the 
0139
 1   commissioners at the next meeting on the 27th if there 
 2   are any additional items that they would like us to 
 3   look at.
 4                 Sandy, would you be willing to figure a 
 5   time for us to -- to talk on the phone.
 6                 MS. JOSEPH:  Sure.
 7                 CHAIRPERSON TAYLOR:  Okay.  Thank you 
 8   so much.
 9                 MS. JOSEPH:  About -- about what 
10   subject?  
11                 CHAIRPERSON TAYLOR:  The annual report.
12                 MS. JOSEPH:  All right.
13                 CHAIRPERSON TAYLOR:  If you could put 
14   us together, we would appreciate it since we are 
15   pretty widely separated.
16                 MR. ATKINS:  Well, why don't -- why 
17   don't we do this.  I'll ask Terry Shankle actually -- 
18                 CHAIRPERSON TAYLOR:  Okay.
19                 MR. ATKINS:  -- in the Bingo Division 
20   to help coordinate that.
21                 CHAIRPERSON TAYLOR:  Great.  So we will 
22   be meeting on the phone before the next meeting and 
23   see what we can come up with.
24                 Item Number 13, report and possible 
25   discussion on the 2006 Bingo Advisory Committee 
0140
 1   work plan.
 2                 MR. ATKINS:  And, Members, what I have 
 3   in your notebook is a copy of the two thousand, I 
 4   guess, and five work plan that was adopted in May.
 5                 For the newer members, by way of 
 6   background, this was a recommendation from the Sunset 
 7   Committee and some of their reviews, for the BAC to 
 8   develop an annual work plan to submit to the 
 9   commission outlining those items that the BAC would be 
10   working on during the coming year.
11                 MR. WHITTINGTON:  I suggest that maybe 
12   we have the same thing to do for this year.
13                 MR. ATKINS:  I don't know that if for 
14   the coming year, if there is anything else that really 
15   needs to be done on the operations manual.  And if it 
16   was just approved this year -- 
17                 MR. WHITTINGTON:  Right.
18                 MR. ATKINS:  -- and put out there --
19                 MR. WHITTINGTON:  Right.
20                 MR. ATKINS:  -- you know, there's -- 
21   well, I guess I won't say that.  It may be that what 
22   could replace that could be the Caller of the Year 
23   program.  That seems to be the one item that is 
24   ongoing in nature that's still pending.  You know, the 
25   review of the Bingo Bulletin and website, that's been 
0141
 1   done.  I don't know if there is an interest or a need 
 2   to, you know, review that in 2006.
 3                 The rest of the items are, you know, I 
 4   think either ongoing or tend to be ongoing in nature.  
 5   I don't know, again, if the review of the forms, if 
 6   there is anything pending out there at this time.
 7                 MS. LOPEZ:  Aren't those pretty -- 
 8   aren't those all already all on the website where, I 
 9   mean --
10                 MR. ATKINS:  They --
11                 MS. LOPEZ:  -- that's pretty much 
12   standard.
13                 MR. ATKINS:  They are for -- yeah.
14                 MS. LOPEZ:  I mean, they are all 
15   reporting in audit form, so I don't know.  Those would 
16   have to be revisited by us.
17                 MR. ATKINS:  And, really, the only 
18   thing that the division is doing as it relates to 
19   forms right now is reviewing the forms for consistency 
20   from form to form so...
21                 MS. ROGERS:  If we figure out what we 
22   want on and what we want off, I will be happy to 
23   retype it so we can have it the next meeting.
24                 CHAIRPERSON TAYLOR:  You -- if we agree 
25   on this now, I don't think that we -- we really need 
0142
 1   to take it to the commission for their approval.  So 
 2   if we agree on these items at this time, then we will, 
 3   again, have it at their meeting on the 27th for their 
 4   approval.  So what I'm seeing is that we'll keep --
 5                 MR. ATKINS:  Well, let me -- let me 
 6   correct you.  I think the preference would be --
 7                 CHAIRPERSON TAYLOR:  Oh.
 8                 MR. ATKINS:  -- that this be a 
 9   standalone item.
10                 CHAIRPERSON TAYLOR:  Okay.
11                 MR. ATKINS:  And I don't know if there 
12   is time to get that on the agenda -- 
13                 CHAIRPERSON TAYLOR:  Okay.
14                 MR. ATKINS:  -- for the 27th.
15                 CHAIRPERSON TAYLOR:  Okay.  Well, so on 
16   the agenda for their next meeting, then, for -- the -- 
17   the following meeting.
18                 So we are going to keep Items Number 1, 
19   2, 3, 5, 7, and 9, and add Caller of the Year 
20   program.  Is everybody good with that?
21                 Okay.  Then in that case, we will get 
22   it together and have it at the commission meeting 
23   wherever we can get on the agenda.
24                 MR. WHITTINGTON:  Sounds good.
25                 CHAIRPERSON TAYLOR:  Okay.  Great.
0143
 1                 Then we will go on to Item Number 14, 
 2   report and possible discussion on the activities of 
 3   the Charitable Bingo Operations Division.
 4                 MR. ATKINS:  Real quickly, just some 
 5   items that I would like to add in addition to the 
 6   information that's in your notebook.  One of the 
 7   things that we started to do and we've done it 
 8   effective with this meeting, although we were a little 
 9   late getting to it since it was the first time.  But 
10   we started to actually post this notebook on the 
11   division's website.  So, it will be out there also.
12                 It's located under legal notices, if 
13   you go to BAC meetings or transcripts, actually, it 
14   will show up as the February 15th, 2006, BAC 
15   notebook.  So our plan for future meetings will be to 
16   post this to the website contemporaneously when we 
17   supply it to the BAC members.  So that's out there, 
18   and it will also be out there for the public if they, 
19   you know, want to go back and compare transcripts to 
20   what was contained in the notebook.  They'll have 
21   access to that information now.
22                 MR. WHITTINGTON:  That's good.
23                 MR. ATKINS:  Also, with the close of 
24   the fourth quarter for 2005, we'll be doing our normal 
25   press releases that we do.  It does generally cover 
0144
 1   gross receipts, prizes awarded, and allocations.  What 
 2   we're planning on doing are -- I don't know right now 
 3   if these will be two additional press releases or if 
 4   they will be one additional press release that covers 
 5   both items.  But one is a press release specific to 
 6   pull-tab sales, and I think we mentioned earlier that 
 7   we are anticipating pull-tab sales for 2005 to be over 
 8   $220 million which is the most that pull-tab sales 
 9   have ever been and, also, the fact that total 
10   charitable distributions, since bingo was authorized 
11   in the early '80s, have now exceeded over $800 
12   million.
13                 And you know that we have a graphic on 
14   our website where we've been tracking total 
15   distributions.  Well, of course, they're updating 
16   that; but we also want to issue a press release to the 
17   media covering that fact.  And we are getting closer 
18   to our billion dollar mark.
19                 And then the last thing.  There are two 
20   additional reports that we are working on having put 
21   on the statewide financial report icon for the Bingo 
22   Services Center.  One would allow the public to access 
23   allocations for the local jurisdictions and the other 
24   is one that would allow the search of active 
25   organizations.  And that is -- or I'm sorry -- I 
0145
 1   should say active licensees.
 2                 Currently on the website what we have 
 3   is the ability to search just for conductor 
 4   organizations either by their mailing address or plain 
 5   location.  This new report will encompass all 
 6   licensees, conductors, lessors, manufacturers, 
 7   distributors.  We are working with the programmers to 
 8   include some pretty robust search capability so that, 
 9   if necessary, you can go in and search by type of 
10   organization.  Say an organization -- conductor 
11   organization that is licensed as a religious 
12   organization in Dallas County, you'll be able to 
13   search down to that type of detail.  And, also, this 
14   will include organizations that are in administrative 
15   hold status; that is, they have a license, but they 
16   are not currently conducting a bingo activity.
17                 So, again, we just started developing 
18   the specifications for those reports, and we will be 
19   working with information and resources over the next 
20   coming months to get those out to the website.
21                 MS. ROGERS:  I --
22                 MR. ATKINS:  And that's all I have.
23                 MS. ROGERS:  I have a question for you, 
24   Billy.  Now I admit that I am not a computer whiz or 
25   internet whiz.  Are our meeting dates on the 
0146
 1   websites?  
 2                 MR. ATKINS:  Yes, they are.  They are 
 3   located under the on news alert section and -- 
 4                 MS. ROGERS:  I don't recall the news 
 5   alert.
 6                 MR. ATKINS:  Okay.  If you recall back 
 7   in November -- 
 8                 MS. ROGERS:  I know we talked about it.
 9                 MR. ATKINS:  Right.
10                 MS. ROGERS:  Right.
11                 MR. ATKINS:  And we set tentative 
12   dates, and those are located under the news alert 
13   section.
14                 MS. ROGERS:  Okay.  I looked for them 
15   and couldn't find them there.
16                 CHAIRPERSON TAYLOR:  I got to say I 
17   think it's awesome that this stuff is going to be on 
18   the web because that way anybody actually interested 
19   knows what we are looking at as we're going through 
20   our meeting.
21                 MR. ATKINS:  Right.
22                 CHAIRPERSON TAYLOR:  It's great.
23                 MS. ROGERS:  And it's great for their 
24   thoughts about our meetings.  Maybe we will get a 
25   little more participation from the public.  Maybe.
0147
 1                 CHAIRPERSON TAYLOR:  Any questions or 
 2   more discussion.
 3                 MR. MANIO:  I have just one small 
 4   question.  This is probably more for Terry Shankle 
 5   than for Billy.  I'm referring to the electronic 
 6   forms, quarterly forms.  And the prototype that we 
 7   worked on for the unit was consistently made up of 
 8   five members.  The one that's posted on the website 
 9   right now, the last time I looked there were only two 
10   members on the worksheet.
11                 MR. ATKINS:  Are you -- are you aware 
12   of that, Phil?  
13                 MR. SANDERSON:  I have to go back and 
14   look.  I'm not aware of any reason why the -- the 
15   number of members in the unit in that workbook would 
16   be five or seven.
17                 MR. MANIO:  Well, yeah.  The last time 
18   I saw them, that was last week.  There were only 
19   two -- two worksheets for the members, instead of five 
20   or six.
21                 MR. ATKINS:  Are you talking about on 
22   the quarterly report or one --
23                 MR. MANIO:  Quarterly.
24                 MR. ATKINS:  -- of the schedules?  
25                 MR. MANIO:  The quarterly reports for 
0148
 1   the unit and unit members for the report.
 2                 MR. ATKINS:  Quarterly report for the 
 3   accounting unit where unit members and -- so what else 
 4   was missing?  
 5                 MR. MANIO:  Because on the date of the 
 6   report for the unit and unit members, there's -- there 
 7   are only two worksheets for the members, instead of 
 8   five or six.
 9                 MR. SANDERSON:  Are you talking about 
10   the automated forms or the electronic filing forms?  
11                 MR. MANIO:  The electronic filing 
12   forms, the quarterly.
13                 MR. ATKINS:  Okay.  I'm looking at the 
14   Texas Bingo quarterly report for use by non-unit 
15   conductors, Texas Bingo unit quarterly report produced 
16   by accounting units -- 
17                 MR. MANIO:  That's right.
18                 MR. ATKINS:  -- Texas Bingo lessor 
19   quarterly report and instructions.  And so which -- 
20                 CHAIRPERSON TAYLOR:  That one right 
21   there.
22                 MR. MANIO:  The unit --
23                 MS. LOPEZ:  After the lessor.
24                 MR. MANIO:  The unit report.
25                 MR. ATKINS:  Okay.  So if I open that 
0149
 1   up, something will be missing?  
 2                 MR. MANIO:  Well, yeah.  The model that 
 3   we worked on, the workgroup, it had space for five 
 4   charities.  The one that's posted on the website has 
 5   only two worksheets for two --
 6                 MR. WHITTINGTON:  For charities.
 7                 MR. MANIO:  For the members.
 8                 MR. ATKINS:  Oh, okay.  So, yeah, 
 9   currently the report only has, Phil, two tabs at the 
10   member for member one and member two.
11                 MR. SANDERSON:  Okay.
12                 MR. ATKINS:  Is there a way to add 
13   additional worksheets for members?  
14                 MR. SANDERSON:  No.  There may be a 
15   macro that -- and the instructions will tell you how 
16   to add additional worksheets, or we will have to go 
17   out and modify it.
18                 MR. ATKINS:  Okay.  We are going to 
19   have to look at that, Mario.
20                 MR. MANIO:  Okay.
21                 MR. ATKINS:  Because when I go to 
22   Schedule B and I add unit members during this 
23   reporting period, if I add -- it defaults to two, but 
24   if I add -- if I add additional macros, it doesn't 
25   insert additional worksheets at the bottom.  And what 
0150
 1   that may be a factor of is the security level that you 
 2   have set and whether or not it will add additional 
 3   macros.
 4                 MR. SANDERSON:  That could be part of 
 5   it, yes.
 6                 MR. ATKINS:  Okay.
 7                 MR. SANDERSON:  And I may be on the -- 
 8   is it -- some of them have a cover page or a cover tab 
 9   that gives you input information about the 
10   organization?  Does is it have a question about how 
11   many members are in a unit?  
12                 MR. ATKINS:  On Schedule B?  
13                 MR. SANDERSON:  Yes.
14                 MR. ATKINS:  On Schedule B it does.  It 
15   says unit members during this reporting period, and 
16   there's a drop down box to apparently select up to 15.
17                 MR. MANIO:  Okay.
18                 MR. ATKINS:  But when you do that, it 
19   doesn't add the corresponding tab at the bottom.
20                 MR. MANIO:  Okay.
21                 MR. SANDERSON:  We'll look into it.
22                 MR. ATKINS:  Well, thank you for -- for 
23   pointing that out.
24                 CHAIRPERSON TAYLOR:  Is that it on this 
25   item?
0151
 1                 Then we are down to 15, public comment.
 2                 MS. LAUDER:  Good afternoon.  Thank 
 3   you, Madam Chair.
 4                 My name is Carol Lauder, and as most of 
 5   you know I am here as a facilitator to provide input 
 6   on the process for you.
 7                 Earlier, Item Number 7, you discussed 
 8   the state of bingo, and I just wanted to share 
 9   particularly with some of your newer members that in 
10   December of 2004 there was a meeting between the 
11   commissioners, the BAC, the Bingo Division, and the 
12   industry or public.  And it was a meeting where we 
13   spent an entire day defining the roles and the goals 
14   of each of those four groups.
15                 And then each group agreed and reached 
16   consensus on the roles and goals of each of those four 
17   groups, and some really good ideas surfaced about how 
18   to address some of the challenges that you had in 
19   terms of the popularity for the decline in bingo 
20   today.  And so I thought that might be a document 
21   that -- is that still on the website, Billy, the 
22   minutes?  Or do they purge off for lack of -- 
23                 MR. ATKINS:  No.  They should still be 
24   there.
25                 PUBLIC MEMBER:  Okay.  So that's 
0152
 1   December of 2004.  There's a very informative set of 
 2   minutes that would be helpful to kind of remind you of 
 3   some of the ideas that y'all came up with about how to 
 4   address it.  And it was mostly goals and role 
 5   definitions, but there were some ideas that came up 
 6   that I thought could be pursued.
 7                 Any questions on that?
 8                 The other thing I wanted to mention is 
 9   fairly elementary -- and I hope you'll forgive me.  
10   But I -- from a process standpoint, I'm a little bit 
11   concerned about how long the meetings might go without 
12   having a real true break, and I don't know if you have 
13   any diabetics on your committee or, you know, 
14   sometimes blood sugar dropping and that sort of thing.  
15   So I'm just going to recommend that y'all consider 
16   having some real breaks if you're going to go through 
17   lunch and have meetings that last up to four hours.  
18   Just a thought.
19                 And the last thing, I just want to 
20   congratulate you continuing to really have dynamic 
21   discussions on your agenda items and a real exchange 
22   of ideas and I just see a lot of accomplishment 
23   through your discussions at your meetings.
24                 That's all.  Thank you.
25                 CHAIRPERSON TAYLOR:  Thank you.
0153
 1                 Anybody else?
 2                 If not, Item Number 16, consideration 
 3   of and possible action on future bingo advisory 
 4   committee meeting dates and/or items to be considered 
 5   for future meetings.
 6                 MR. ATKINS:  The next meeting date was 
 7   scheduled for May 17th.
 8                 MR. WEEKLEY:  May 16th?  
 9                 MR. WHITTINGTON:  17th.
10                 MS. ROGERS:  You said 17th, correct?  
11                 MR. ATKINS:  Yes.
12                 CHAIRPERSON TAYLOR:  Is that still okay 
13   with everybody?  Okay.  May 17th, 10:00 o'clock.
14                 MS. ROGERS:  Yes.
15                 CHAIRPERSON TAYLOR:  And items to be 
16   considered for the meeting.
17                 MS. ROGERS:  Bingo Caller of the Year, 
18   please.
19                 CHAIRPERSON TAYLOR:  All right.  I 
20   think most of these work groups.  We are going to be 
21   continuing with the price fixing work group the 
22   progressive bingo and alternative style of play 
23   work group .  We're going to talk and most likely have 
24   a discussion on the fourth quarter 2005 since that 
25   will be out by then.  Public service announcements, do 
0154
 1   we -- that will be ready for us to look at?  
 2                 MR. ATKINS:  You know, again, 
 3   hopefully -- 
 4                 CHAIRPERSON TAYLOR:  Maybe.  
 5                 MR. ATKINS:  -- it will already have 
 6   gone out.
 7                 CHAIRPERSON TAYLOR:  Okay.
 8                 MR. ATKINS:  So, you know, we may have 
 9   some things to report in terms of the amount of play 
10   if anybody comes.
11                 MS. LOPEZ:  I think we should leave it 
12   on there as an agenda topic because, I mean, even if 
13   the -- all of the estimates numbers of the PSA are out 
14   in, say, in March or, say, early April May 17th, there 
15   might be positive feedback if we've already seen the 
16   PSAs of our market at that time.
17                 MR. MOORE:  Legislative update for this 
18   special session.
19                 CHAIRPERSON TAYLOR:  And we will have 
20   the annual report, if it's -- a report on whether the 
21   commissioners have approved it, the committee 
22   work plan -- I'm sorry -- the work plan, and then the 
23   annual report.  Hopefully we'll have that ready for 
24   inclusion in this notebook.
25                 Any other items at this time?  
0155
 1                 MR. ATKINS:  We may have some new 
 2   members too.
 3                 CHAIRPERSON TAYLOR:  New members.
 4                 Any other items?  If so, you can go 
 5   ahead and contact Billy or myself and ask them to be 
 6   placed on the agenda.
 7                 And if there is no other comments from 
 8   the group, then we'll go ahead and adjourn the meeting 
 9   at 1:25.
10                 (Concluded at 1:25 p.m.)
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0156
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0157
 1                 REPORTER'S CERTIFICATION
 2   
 3   STATE OF TEXAS      )
 4   COUNTY OF TRAVIS    )
 5   
 6                 I, SHELLEY N. JONES, Certified 
 7   Shorthand Reporter in and for the State of Texas, do 
 8   hereby certify that the above-captioned matter came on 
 9   for hearing before the BINGO ADVISORY COMMITTEE as 
10   hereinafter set out, that I did, in shorthand, report 
11   said proceedings, and that the above and foregoing 
12   typewritten pages contain a full, true, and correct 
13   computer-aided transcription of my shorthand notes 
14   taken on said occasion.
15                 Witness my hand on this 28th day of 
16   February, 2006.
17   
18   
19                      ________________________________
                        Shelley N. Jones, RPR, CSR #8058
20                      Expiration Date:  12/31/06
                        Firm Registration No. 225
21                      1801 North Lamar Boulevard
                        Mezzanine Level
22                      Austin, Texas 78701
                        (512) 474-4363
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     JOB NO. 060215SNJ
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