0001 1 2 3 4 * * * * * * * * * * * * * * * * * * * * * * * * * * * 5 6 BINGO ADVISORY COMMITTEE 7 MEETING 8 9 APRIL 29, 2004 10 11 * * * * * * * * * * * * * * * * * * * * * * * * * * * 12 13 14 15 16 17 18 19 BE IT REMEMBERED that the BINGO ADVISORY COMMITTEE 20 meeting was held on the 29th of APRIL 2004, from 10:04 a.m. 21 to 1:50 p.m., before David Bateman, RPR, CSR in and for the 22 State of Texas, reported by machine shorthand, at the 23 Offices of the Texas Lottery Commission, 611 East 6th 24 Street, Austin, Texas 78701, whereupon the following 25 proceedings were had: 0002 1 APPEARANCES 2 3 Chairman: 4 Ms. Virginia Brackett - Lubbock, Texas 5 6 Committee Members: 7 Mr. Daniel Moore - Houston, Texas 8 Mr. Larry Whittington - Dallas, Texas 9 Ms. Suzanne Taylor - Corpus Christi, Texas 10 Ms. Patricia Greenfield - Weatherford, Texas 11 Mr. Mario Manio - Garland, Texas 12 Mr. Pete Pavlovsky - Rosenberg, Texas 13 Mr. John "Jack" Dougherty - Austin, Texas 14 15 Charitable Bingo Operations Director: 16 Mr. Billy Atkins 17 18 19 20 21 22 23 24 25 0003 1 INDEX 2 3 APPEARANCES..................................... 2 4 5 AGENDA ITEMS 6 Item Number 1................................... 4 Item Number 2................................... 4 7 Item Number 3................................... 5 Item Number 4................................... 33 8 Item Number 5................................... 86 Item Number 6................................... 90 9 Item Number 7................................... 92 Item Number 8................................... 33 10 Item Number 9.................................. 95/97 Item Number 10.................................. 96 11 Item Number 11.................................. 98 Item Number 12.................................. 99 12 Item Number 13.................................. 106 Item Number 14.................................. 110 13 Item Number 15.................................. 110 Item Number 16.................................. 117 14 15 REPORTER'S CERTIFICATE.......................... 118 16 17 18 ******* 19 20 21 22 23 24 25 0004 1 APRIL 29, 2004 2 Bingo Advisory Committee 3 AGENDA ITEM NO. 1 4 CHAIR BRACKETT: Good morning, everyone. It 5 is about two minutes after 10 on our official timepiece on 6 the wall, so we will call to order and welcome to all of you 7 and I appreciate your attendance. Everybody on the Bingo 8 Advisory Committee appreciates your attendance, as well as 9 the Bingo Division of the Texas Lottery Commission. Thank 10 you for being here. 11 I know for a lot of you it's very, very 12 difficult to get here and very, very costly. And we 13 certainly do appreciate that. 14 AGENDA ITEM NO. 2 15 CHAIR BRACKETT: The first item on the agenda 16 is the approval of the minutes of the February 26th meeting. 17 They were published on the Internet. Does anyone have any 18 questions or corrections regarding the minutes? 19 And I'm assuming that everyone read all 75 20 pages of them and -- maybe it was a hundred pages, a lot of 21 pages. 22 Can I get a motion for approval of minutes as 23 they were published? 24 Suzanne, are you making a motion? 25 MS. TAYLOR: I'll make the motion. 0005 1 CHAIR BRACKETT: Suzanne Taylor is making the 2 motion that the minutes be approved as they were published. 3 AGENDA ITEM NO. 3 4 CHAIR BRACKETT: The third item on the agenda 5 is the consideration and possible discussion or action of 6 the Sunset Commission review of the Texas Lottery 7 Commission. Billy Atkins, the director, will be speaking to 8 this. 9 MR. ATKINS: And also joining me will be 10 Melissa Villasenor-Dye, who is with our Governmental Affairs 11 Division. Nelda Trevino is on her way and, if she can make 12 it, will -- will join us. 13 This item is before you, Members. The Sunset 14 staff has issued their issue document on the Lottery 15 Commission. And they had indicated to us that they e-mailed 16 to each or they mailed to each of the BAC members a copy of 17 that report and we also followed up with an e-mail to each 18 of you that that information was located on the Internet and 19 where you could obtain it. 20 As you'll recall, the Lottery Commission went 21 through a Sunset evaluation last legislative session. The 22 issues that are addressed in the current report that you got 23 a copy of are essentially those same issues that were 24 addressed in the 78th Legislature with the exception of two 25 items, those being the issues relating to commercial lessors 0006 1 and charitable distributions. 2 The agency needs to submit to the Sunset 3 Commission an agency response. And it is due to them by May 4 5th. 5 MS. VILLASENOR: On Wednesday, May 5th. 6 MR. ATKINS: Wednesday, May 5th. The staff 7 is going to propose that the agency generally concur with 8 all of the recommendations contained in the Sunset report. 9 Melissa is coordinating the staff response and is available 10 to discuss the process for submitting that response, as well 11 as some time lines that you need to be aware of because, 12 again, if the Advisory Committee desires to have their 13 comments regarding those issues included in the report, I 14 understand that we would need a written response from the 15 Advisory Committee by end of business tomorrow. 16 MS. VILLASENOR: That's correct. Good 17 morning, Madam Chair and Members. For the record, my name 18 is Melissa Villasenor. I'm a Governmental Affairs 19 representative of the Texas Lottery Commission. 20 And again, as Mr. Atkins said, I've been 21 charged with coordinating our agency response to the April 22 2004 Sunset staff report. And if there is going to be a -- 23 I believe in the September 12th response from the BAC, if 24 there is going to be a response to this report, like Mr. 25 Atkins said, if I could have that in writing by tomorrow, 0007 1 that would be greatly appreciated. 2 Due to our response being due next Wednesday, 3 May 5th, and due to our time line, this won't be taken up at 4 the next Commission meeting. We are going to review each -- 5 with each individual commissioner our recommendations. The 6 staff is going to propose that the agency generally concurs 7 with all the recommendations. 8 There will be a public hearing held by the 9 Sunset Advisory Commission to hear public testimony on the 10 operations of the Texas Lottery Commission and its -- and 11 its recommendations contained in the Sunset staff report on 12 May 18th and 19th. Based on the public input and staff 13 report, the Sunset Advisory Commission will adopt 14 recommendations for the full legislature to consider when it 15 convenes in January of 2005. 16 Also in your packet is the memo from 17 Ms. Trevino, the Governmental Affairs director, addressing 18 the 78th 4th Called Special Session, which convened on 19 Tuesday, April 20th, 2004. 20 MS. MORRIS: Excuse me. 21 MR. ATKINS: I'm sorry. 22 MS. MORRIS: I'm sorry, too. I think you're 23 on the next agenda item. 24 MS. VILLASENOR: Oh, I'm sorry. I spoke -- 25 MS. MORRIS: Yeah. 0008 1 MS. VILLASENOR: -- out of turn. I'm sorry. 2 Chairman Brackett, are there any questions that you may have 3 of me, as far as the time line or the process involving the 4 staff report? 5 CHAIR BRACKETT: No. Do any of you have any 6 questions regarding that time line and the staff report? 7 MS. TAYLOR: I do. So the response from the 8 BAC is due by tomorrow. So is that something that we need 9 to do today to have a response or is that something that we 10 can play back and forth with e-mail or is that individual 11 responses? 12 MS. VILLASENOR: I would think it would be 13 the whole body's response to the report. 14 MR. ATKINS: That's -- that's what the 15 Advisory Committee did last year. 16 MS. TAYLOR: One? 17 MR. ATKINS: Yes. 18 MS. TAYLOR: Okay. 19 CHAIR BRACKETT: How about individual 20 responses from like the people who are here? 21 MS. VILLASENOR: That I defer to to Mr. 22 Atkins. 23 MR. ATKINS: Do you mean from Advisory 24 Committee members -- 25 CHAIR BRACKETT: No. 0009 1 MR. ATKINS: -- or members of the public? 2 CHAIR BRACKETT: Members of the public. 3 MR. ATKINS: I think that Melissa indicated 4 that there would be a public comment hearing that the -- 5 MS. VILLASENOR: On the 18th and 19th. 6 MR. ATKINS: -- Sunset Advisory Commission 7 will be having. I think that would be the proper time for 8 them to -- 9 MS. VILLASENOR: To address that. 10 MR. ATKINS: -- submit any comments. 11 CHAIR BRACKETT: Has the date been set for 12 that? 13 MS. VILLASENOR: Yes, ma'am. It's May 18th 14 and 19th. 15 CHAIR BRACKETT: May 18th and 19th? 16 MS. VILLASENOR: Uh-huh. 17 CHAIR BRACKETT: I'm sorry. So what -- what 18 is your question now? What direction are you wanting from 19 us? 20 MS. VILLASENOR: None other than to confirm 21 that, if you do have a response, to provide it in writing 22 tomorrow, Madam Chair. 23 CHAIR BRACKETT: Does everyone understand 24 that, response is due by tomorrow? It can be sent to you 25 electronically, fax or e-mail? 0010 1 MS. VILLASENOR: Well, I prefer a written 2 response communicated to Mr. Atkins. And then Mr. Atkins 3 could provide that to me, the coordination of that, please. 4 CHAIR BRACKETT: All right. 5 MR. ATKINS: But it would facilitate our 6 process if we could get it electronically. 7 CHAIR BRACKETT: All right. And everyone 8 does have this information. We have looked over it, I'm 9 sure. Does anyone have anything else that would be 10 pertinent to ask her right now? 11 All right. Thank you. 12 Do you have any comments, Billy? 13 MR. ATKINS: Nothing -- nothing to add to 14 what is -- I think we've already discussed. 15 CHAIR BRACKETT: Okay. 16 MR. ATKINS: I mean, again, it is our -- our 17 assumption that there, you know, would be a discussion among 18 the members and recommendations on these items that could 19 then be reduced to writing and submitted to us. 20 MS. TAYLOR: So is what you're asking us to 21 go item by item now and say we agree or don't agree with the 22 recommendation? 23 MR. ATKINS: I'm saying that's one 24 possibility, yeah. 25 CHAIR BRACKETT: Okay. Well, look on page 0011 1 one of the report, the summary of the report. Do all of you 2 have a summary there or do you have a full report? Okay. 3 MR. ATKINS: The -- it may help, members, 4 the -- the bingo issues are essentially issues four through 5 six, I believe, four, five and six. 6 CHAIR BRACKETT: Okay. I'm sorry. I was 7 looking at something different than the big report. So that 8 was -- if you turn to page 23, this big report that you 9 have, that's where issue four begins? 10 MR. ATKINS: It may -- if I can, again, jump 11 in real quick if -- you know, the committee may have 12 interest in commenting on issue one, you know, just 13 continuing the Lottery Commission. But issues two and 14 three, I think, are specific to the lottery with four, five 15 and six being specific to charitable bingo. 16 CHAIR BRACKETT: All right. Well, while 17 we're on issue one back on page 11 of the report, the key 18 recommendation is continuing the Texas Lottery Commission 19 for 12 years. 20 Anyone have any objection to that? Are you 21 agreeing with that? You want to send that on as a 22 recommendation? Okay. General consensus is that we agree 23 with this recommendation and send that on. 24 Then I skip over to page 23, where you have 25 issue four. Bingo Advisory Committee has progressed but 0012 1 needs continued improvement to effectively advise the 2 Commission on bingo regulations in Texas. And you see the 3 two key recommendations there, develop an annual work plan 4 and eliminate the statutory designation slot for system 5 service provider. 6 Any comments on this? Do you want to accept 7 this -- send this on as a recommendation from the committee? 8 All right. General consensus is that we do agree developing 9 an annual work plan and the system service provider slot be 10 eliminated. 11 MR. WHITTINGTON: That's (inaudible) 12 CHAIR BRACKETT: The system service slot? 13 No. 14 MR. ATKINS: No. 15 CHAIR BRACKETT: We -- that's what Patricia 16 is. 17 MS. GREENFIELD: I think it's legislative. 18 And they haven't changed that, but I agree with that. 19 MS. MORRIS: Excuse me, Madam Chair. Could 20 you just ask for votes instead of just this general 21 consensus where there's silence? 22 CHAIR BRACKETT: Okay. All right. Do I ask 23 for a vote or -- 24 MS. MORRIS: Yes. 25 CHAIR BRACKETT: -- do you want me to get a 0013 1 motion and a second? 2 MS. MORRIS: Either way. It's just that it's 3 not really reflecting -- 4 CHAIR BRACKETT: Okay. 5 MS. MORRIS: -- action. 6 CHAIR BRACKETT: All right. All those in 7 favor of these two recommendations that we have dealt with, 8 please say aye. 9 MR. MOORE: Aye. 10 MR. WHITTINGTON: Aye. 11 CHAIR BRACKETT: Aye. 12 MS. TAYLOR: Aye. 13 MS. GREENFIELD: Aye. 14 MR. MANIO: Aye. 15 MR. PAVLOVSKY: Aye. 16 MR. DOUGHERTY: Aye. 17 CHAIR BRACKETT: Okay. Thank you. 18 MS. MORRIS: Thank you. 19 CHAIR BRACKETT: Go ahead. 20 MR. ATKINS: If you could just indicate 21 what's unanimous or... 22 CHAIR BRACKETT: Okay. Those -- there were 23 no objections to these two actions that we've taken. 24 And there are several pages of 25 recommendations. And if we skip on over to page 27 -- well, 0014 1 which we dealt with at the -- 2 MR. ATKINS: Could you -- I'm sorry. Could 3 you clarify on issue four, the same vote or -- 4 CHAIR BRACKETT: The vote? 5 MR. ATKINS: Yes. 6 CHAIR BRACKETT: Oh, okay. 7 MR. ATKINS: Is the vote the same on issue 8 one and issue four, the two that you've covered so far? 9 CHAIR BRACKETT: I'm sorry. I really -- I 10 really like to do the Reader's Digest version of things and 11 just kind of move on in a hurry, so -- but to make it very 12 clear in the minutes, which I'm -- agree is very important, 13 the first thing we voted on was issue one. 14 Now it's issue four, which -- that the Bingo 15 Advisory Committee has progressed but needs continued 16 improvement to effectively advise the Commission on bingo 17 regulation in Texas. All those in favor of this issue, 18 please say aye. 19 MR. MOORE: Aye. 20 MR. WHITTINGTON: Aye. 21 CHAIR BRACKETT: Aye. 22 MS. TAYLOR: Aye. 23 MS. GREENFIELD: Aye. 24 MR. MANIO: Aye. 25 MR. PAVLOVSKY: Aye. 0015 1 MR. DOUGHERTY: Aye. 2 CHAIR BRACKETT: All right. Thank you. And 3 again, it is unanimous response, favorable response to that. 4 Okay. Issue number five is the State 5 oversight of system service providers is no longer needed. 6 Is there any -- and the action would be to abolish the 7 regulation of system service providers. 8 Since -- I would really like for Patricia 9 Greenfield to comment on this since she is the system 10 service provider on the Bingo Advisory Committee. 11 MS. GREENFIELD: And I did. I agree with it. 12 I think that there's really no need for regulation of system 13 service providers and that it should be abolished. 14 CHAIR BRACKETT: Anyone have any questions 15 or -- of Patricia or anyone? 16 Okay. Are you ready for action? Okay. All 17 those in favor of the recommendation to abolish the 18 regulation of the system service provider serving on the 19 Bingo Advisory Committee, please say aye. 20 MR. MOORE: Aye. 21 MR. WHITTINGTON: Aye. 22 CHAIR BRACKETT: Aye. 23 MS. TAYLOR: Aye. 24 MS. GREENFIELD: Aye. 25 MR. MANIO: Aye. 0016 1 MR. PAVLOVSKY: Aye. 2 MR. DOUGHERTY: Aye. 3 CHAIR BRACKETT: All those opposed? Okay. 4 Then that, too, carries unanimously. 5 And I'm also going to back up. I failed to 6 remind people to be sure and turn in their witness 7 affirmation form. So if anyone has any that they'd like to 8 bring forward, that would be fine. 9 Would anyone like to make any public comment 10 on any of these things with the Sunset review report? 11 MR. BRESNEN: I'd like to comment on six. 12 CHAIR BRACKETT: Six, okay. 13 MR. BRESNEN: Y'all haven't voted on six yet, 14 have you? 15 CHAIR BRACKETT: We're getting ready to. 16 MR. BRESNEN: Ready when you are. 17 CHAIR BRACKETT: Okay. On issue number six, 18 from the -- okay. Issue number six is key elements of the 19 State Lottery Act and the Bingo Enabling Act do not conform 20 to commonly applied licensing practices. 21 Steve? 22 MR. BRESNEN: My name is Steve Bresnen and 23 I'm here at this time to testify on behalf of the Bingo 24 Interest Group. 25 It's my -- first of all, I want to say that 0017 1 the Sunset staff and the Charitable Bingo Division staff has 2 worked very well with a whole lot of us on this Sunset 3 process following the session last year. I think we all -- 4 at least my sense of the consensus we reached was there was 5 -- House Bill 2519 made for a whole lot of ferment and 6 change in the charitable bingo world and that it had the 7 potential, maybe, to moot out some of the previous issues 8 that were in the report last time. 9 And yet there were a few things, like the 10 function of the BAC and these commonly applied licensing 11 practices, that still needed to be worked on or given 12 consideration. 13 And so this report, I think, reflects input 14 that we've had. We had several meetings with them. We've 15 had several meetings with staff and talked about a lot of 16 these things. And -- and so I think we've -- I think we've 17 come a long way on these. 18 With respect to the commonly applied 19 licensing practices, we have a -- you know, there's a -- 20 there's prose and there's poetry. And we've got a lot of -- 21 we've got a lot of prose right here, but poetry's in the 22 statute. And so for my -- I think for my clients I would 23 say that, you know, many of these things are fine provided 24 the statute is drafted in a way that takes into -- takes 25 into account a number of considerations. 0018 1 And let me -- I won't -- I won't spend too 2 much time on this because y'all have got a big agenda today. 3 But let me just give you an example, if I could. One is on 4 the -- it's on page 37, recommendation 6.12 on expanding the 5 Commission's authority to temporarily suspend licenses to 6 prevent financial losses to the State. 7 The Bingo Interest Group has been on record 8 for a long time agreeing with the position that the Division 9 should be able to protect the State from financial loss 10 through a summary or temporary suspension type process. On 11 the other hand, there are other organizations within each 12 hall that are going to be affected if there's a hole in the 13 schedule and no way to fill that hole expeditiously. 14 So as the process goes forward, I'll be 15 watching, and I'm sure y'all will and others will, that 16 the -- that that nuance be taken care of. It could be -- I 17 think last time we talked about maybe the issuance of some 18 temporary licenses so other -- other organizations that were 19 conducting at a hall could fill in that hole. 20 So you don't have the situation where people 21 show up to play at the first session in a day and the place 22 is closed and so they're not there to hold over for the 23 second session or it spreads throughout the bingo player 24 community that, oh, that hall's closed down. 25 We don't want to have that happen. And we 0019 1 don't want the costs that are not covered by that -- by an 2 organization that gets suspended, we don't want those fixed 3 costs that are necessary in running that hall then to be 4 spread across the other organizations by default. 5 So there's some nuances that need to be taken 6 into account here. I'm not sure, Billy, what the 7 appropriate way is for the -- for the BAC to take note of 8 that in its recommendations to the Commission. But if 9 there's an easy way to do it without getting too 10 complicated, I would hope that you would qualify your 11 support based on those kinds of nuances that may be peculiar 12 to the bingo operation. 13 The structure of regulation of bingo is 14 considerably different from almost every industry. And the 15 way these model licensing provisions have been developed by 16 the Sunset Commission over the years is -- they've done 25 17 years of reviews and they've found a commonality of powers 18 and procedures that are maybe appropriate for almost any 19 industry. 20 On the other hand, in most industries you've 21 got a -- an actor who's acting 24/7 as a unitary entity 22 that, if they're summarily suspended, it affects them, maybe 23 if affects some downstream suppliers or it affects somebody 24 on a job site if they don't get completed in time, but it's 25 not a fragmented situation the way we have in charitable 0020 1 bingo. 2 So again, I don't know how you -- how you 3 want to account for this in your recommendation, but I think 4 you need to be mindful that some of these things need to be 5 tailored to charitable bingo. Otherwise, I think most of 6 these things they have in mind to apply those model concepts 7 of regulation that are appropriate in most circumstances. 8 Some of them -- you may have a better idea 9 about this than I do, so I'd like to ask a question, if I 10 might. Some of these things, like, you know, requiring the 11 Commission to adopt rules governing all bingo compliance, 12 monitoring, enforcement procedures, well, we've been -- 13 we've been going through that process for several years. 14 So I'm not really sure why that 15 recommendation is in here or what hole it fills. We've been 16 through an audit rule, a licensure rule, bonding rule and 17 all those things. So you may be -- you may know if they 18 have something in mind in excess of what you're doing or is 19 this just the template that they, you know, plop down for 20 each Sunset report. 21 MR. ATKINS: If that's your question, I think 22 that the answer is your last statement. I think that they 23 just generally want to have the language in a licensing 24 statute. 25 And I might can offer some clarification on 0021 1 your comment regarding the suspension of organizations that 2 have the financial liability to the State. The Advisory 3 Committee -- this is the Advisory Committee's recommendation 4 on the last report. 5 And it's a little different than what you 6 were saying because it says the Bingo Advisory Committee 7 poses this recommendation. The committee believes the 8 recommendation is too vague. The committee has questions 9 about the suspension of one charity's license -- and this 10 looks like a typo -- of one charity's license would affect 11 the continuity of the bingo sessions in a hall. 12 MR. BRESNEN: Right. 13 MR. ATKINS: So I think that last sentence 14 raises the issue that you had. Now I -- just to let you 15 know, Steve, that I don't know that we always find 16 situations where -- what we generally find is, when one 17 organization is falling behind or whatever, generally others 18 are at the location, too. 19 MR. BRESNEN: Okay. Well, I mean, if they 20 were -- if they're behind, if there's five there and four 21 are behind, I'm assuming you'd, you know, take the same 22 action or maybe you wouldn't. Maybe you'd -- it would 23 depend on if they had the noncompliance pattern or whatever. 24 But it's the -- it's the people who are doing 25 right that we don't want to get hit based on somebody's 0022 1 conduct doing wrong. On behalf of the Bingo Interest Group, 2 I think we've been consistent that we think you need some 3 power to protect the State against loss. 4 If the BAC's idea is to say we oppose it 5 because it's too vague, that would be y'alls position. But 6 ours is -- and I think we've been consistent in this for a 7 good while. You know, if people aren't paying their taxes, 8 they need to pay their taxes. But let's don't drag the rest 9 of them down with them. 10 MR. ATKINS: Yeah. And I just put that out 11 there as to maybe help take up the Advisory Committee 12 facilitate, if they are generally in concurrence with your 13 position about, you know, wanting organizations with 14 liabilities to pay those, it's possible that it could be 15 sufficient enough to say the Advisory Committee supports 16 this recommendation, the committee has questions. 17 MR. BRESNEN: Right. 18 MR. ATKINS: Include that sentence, also. 19 MR. BRESNEN: You're better prepared than I 20 am today. I appreciate it. Bye. Thanks. 21 MS. GREENFIELD: Can I make a comment on the 22 6.12 y'all were just talking about? I thought, if we 23 support this, that maybe we could look back at the bond 24 issue -- the bond rule that went up to the three times that 25 Mario has brought up before. And maybe that rule could be 0023 1 revised and brought down to what it was before, one time, if 2 you're able to enforce and stop people from playing before 3 they get into trouble. 4 And that's my comment on that recommendation. 5 MR. FENOGLIO: Good morning, Madam Chair. I 6 did fill out a -- 7 CHAIR BRACKETT: Yes. I have it right here. 8 Go right ahead. 9 MR. FENOGLIO: My name is Steven Fenoglio and 10 I represent over 950 charitable business organizations. 11 Concerning Ms. Greenfield's comment, that was 12 a comment I was going to make. One of the reasons y'all 13 changed the penalty or the bond provisions was because of 14 the concern about charities being able to keep the ball up 15 in the air when they've not filed or paid or both their 16 quarterly taxes or quarterly fees to the State. 17 And I think if you're going to give them that 18 temporary suspension authority then, likewise, the 19 Commission staff should drive down the bond requirement 20 because you no longer -- the justification for that three 21 times bond requirement was because of it takes forever to 22 get a charity who wants to fight the issue and who hasn't 23 been in compliance, like the overwhelming majority of 24 charities are, that you want to be able to have that bond to 25 protect the interest of the State. 0024 1 There are a couple of other issues in the -- 2 I guess there are 12 discrete issues in recommendation six. 3 Number one on 6.1, I think the Commission already has clear 4 qualifications for bingo licensure, but I don't have a 5 problem or my -- and my clients don't have a problem with 6 it. 7 But I think Phil and Billy and their staff 8 have done a pretty good job of getting the forms down where 9 it's pretty clear. And certainly the staff of the 10 Commission are available to answer any questions. So I'm 11 not sure I agree with it, but it's not a -- there's no real 12 objection to it. 13 6.2 is another issue that we discussed in the 14 last legislative session about some agent -- some charities 15 have to be in existence for three years, five years, some 16 only one, some I think it's eight or 10 for a church. And 17 so it seems to me that, if it's a nonprofit organization, 18 the same standards should apply. 19 And I think that's something -- an 20 observation that the staff recommended in their initial 21 filing back in -- I guess it was early '02 in the last 22 round. 23 I think the agency has some pretty good 24 standards on the renewal process on 6.3. But again, it's 25 not really objectionable. 0025 1 I also think on 6.4 the agency does consider 2 compliance history when they renew licenses. And I am aware 3 that the staff will hold a license, even if you've timely 4 filed your renewal. If there's a complaint pending, they 5 will hold action on the renewing of that license until that 6 compliance matter is resolved. 7 6.5 is a kettle of -- kettle of worms or 8 kettle of fish, or whatever my metaphor is, on temps. There 9 are a whole host of license applications that are acted upon 10 on temporary authorization, and it's a big policy issue. 11 Earlier in the report, it outlines the number of temps that 12 are acted on on an annual basis. And I think it's over a 13 thousand. 14 Yes, the Bingo Enabling -- at the bottom of 15 page 33, the Bingo Enabling Act currently authorizes 16 temporary bingo licenses for special occasions totalling 17 about 28 hundred in calendar year 2002. And I recognize the 18 pull and the pull -- the push and pull in having a relaxed 19 standard for a temporary authorization, which is the current 20 commission review, that they don't go into the exhaustive 21 background investigation that you do for an annual license. 22 And I personally think it's a good idea for 23 the Commission to have that flexibility, because you can 24 see, I mean, if you've got 28 hundred temps, y'all -- the 25 agency doesn't act on 28 hundred. That's about 14 hundred 0026 1 license renewals for conductors today. And, in fact, I 2 don't believe there are a total of 28 hundred license 3 actions on a permanent or annual basis the agency considers 4 each year. 5 So you can imagine the increased workload 6 that it would put on this agency. And believe it or not, I 7 am compassionate about the workload of the agency. 8 Steve Bresnen adequately covered that other 9 issue that -- 10 MR. ATKINS: Steve, if I could just clarify 11 on that point, again, to go back on my earlier comments on 12 what the staff's recommendation will be on these items, that 13 one, 6.5, is one of those where it will be the staff's 14 recommendation to generally concur with the recommendation. 15 It will be similar to our recommendation, 16 again, in the report to the 78th Legislature in that the 17 agency will continue to examine the potential fiscal impact 18 of the recommendation and will be open to exploring, you 19 know, different options to meet the intent of the 20 recommendation while remaining fiscally responsible. 21 MR. FENOGLIO: And I think that's probably a 22 very good position to have in that regard. 23 Complaint issues on 6.6, I agree with that. 24 I filed a complaint on behalf of several charities about 25 almost three years ago and that issue has never been 0027 1 resolved to our knowledge. So I think there should be a 2 calendaring of those complaints and resolution of them. And 3 I guess that's 6.7, not 6.6. 4 Clear standards, 6.8, I think the agency has 5 some pretty clear standards. And again, Mr. Bresnen 6 addressed the issues that I was going to make. 7 So I'll be happy to answer any questions 8 other than that. Thank you, Madam Chair, Members. 9 CHAIR BRACKETT: Does anyone have any 10 questions of Steve before he -- before he leaves? Okay. 11 Thank you, Steve. 12 I want to make sure that no one else has 13 requested to speak on this item. And I don't have any 14 witness affirmations, any other witness affirmations for 15 this particular item. Anyone on the committee have a 16 comment or want to make a recommendation? 17 MR. MANIO: I have a question, Virginia. 18 CHAIR BRACKETT: Uh-huh. Okay. 19 MR. MANIO: Pertaining to 6.5, and Steve 20 mentioned over two thousand temporary licenses issued in the 21 year 2000. I was just curious. Out of those over two 22 thousand licenses, how many were issued as an annual license 23 and how many are just temporary licenses with no annual 24 licenses? Because that would -- that would have a bearing 25 on the oversight. 0028 1 MR. ATKINS: I think part of that is covered 2 in the report, Mario, on page 33 at the bottom of page 33. 3 There were approximately 28 hundred temporary licenses 4 issued, a total of 28 hundred licenses issued. 5 MR. MANIO: Okay. 6 MR. ATKINS: I'm going to have to ask Phil 7 Sanderson to come up and see if he remembers the specifics 8 about how many of those were issued to non-annual license 9 holders. 10 MR. SANDERSON: Phil Sanderson, assistant 11 director of the Charitable Bingo Division. If memory serves 12 me correct, I want to say that there were about 800 of those 13 out of the 28 hundred were non-annual license organizations, 14 temporaries. Roughly about three to four hundred 15 organizations played the 800 temporaries. 16 The other two thousand are annual license 17 holders that are playing along with that temporary. 18 MR. MANIO: Thank you. 19 CHAIR BRACKETT: Any other questions or 20 comments? What is your recommendation for action on this -- 21 from the Sunset review regarding licensing? Do you want to 22 accept the recommendations with comment? 23 MS. TAYLOR: I do like the comment we made 24 last year concerning 6.12, the sentence that Billy read 25 earlier, the last sentence of the BAC recommendation from 0029 1 last time we went through this. And I do agree with Mario 2 on the fact -- or I don't know if this is what he was aiming 3 at, but I agree that on 6.5, if it's an annual license 4 holder, I don't think that there needs to be additional 5 oversight, because that goes in with the quarterly reports. 6 But for non-annual holders, I think that 7 there should be some oversight. 8 MR. MANIO: That's -- that's correct. And 9 that's why I wanted to know the numbers. 400 is a 10 significant number of licenses. 11 MR. ATKINS: And I'll make the same comment 12 that we made to the Sunset staff. We believe there is 13 oversight of those organizations. For example, if they 14 don't file quarterly returns, we know that and we follow up 15 on that. 16 So it's not like those licenses are issued 17 and, you know, those organizations are forgotten about. 18 It's just the staff's position that the language in the 19 Sunset staff report potentially could be excessive. 20 You know, subjecting an organization without 21 an annual license to conduct a bingo game under a temporary 22 license more as a social activity than anything else, maybe 23 only grosses several hundred dollars, you know, sending two 24 auditors out there to conduct an audit on that organization 25 is going to far outweigh any benefit in terms of a price fee 0030 1 that could be recovered by the State. 2 So again, we think that oversight that the 3 organizations with non-annual temporary licenses that they 4 currently receive is adequate. We're, of course, open to 5 exploring that and see if there are other things that we can 6 do in a cost-effective manner. 7 MR. MANIO: And in addition to what Billy 8 said -- and I agree with what he said. If anyone would take 9 a look at the application for the temporary license for 10 non-annual license holders, it is an overwhelming task. And 11 that in itself will deter anyone who is not sincere in 12 fulfilling its obligation to the State. The requirements 13 are almost similar to applying for a new license. 14 MR. ATKINS: And that's an excellent point. 15 You're exactly right. For an organization that has never 16 held a temporary before, when they get their first temporary 17 license, we do require essentially the same information that 18 we would for an organization applying for an annual license. 19 Now just like with annual licenses, once we 20 have that information on record, then those organizations 21 are able to submit the -- the much shorter application form 22 for additional temporaries. But again, on those 23 organizations that we don't have a history with, we get that 24 information. 25 MR. MANIO: But my sense is that the 0031 1 oversight being conducted right now is probably sufficient. 2 And all that we need to do is probably recommendation. 3 CHAIR BRACKETT: Okay. So you're 4 recommending that we do support this recommendation that -- 5 or support these -- yeah, these recommendations for the 6 Sunset Review Commission regarding licensing? 7 MR. MANIO: I would support what Billy said, 8 that what the staff is doing right now regarding non-annual 9 license holders applying for temporaries is sufficient. 10 CHAIR BRACKETT: Are we -- are we approving 11 these one by one or are we approving the whole -- like the 12 whole change regarding licenses, the recommendations here, 13 6.1, 6.2? 14 MR. ATKINS: That's the committee's decision 15 how they want to do it. I mean, I do hear at least comment 16 on two of them, two -- comment on two of them. Specifically 17 one, I think, is 6.5 and the other is -- 6.12? 6.12? 18 CHAIR BRACKETT: Yes. 19 MR. ATKINS: So, you know, it's the -- it's 20 the -- you know, the committee's decision. You can move to 21 agree with the recommendations with the comment that Mario 22 made regarding 6.5 that the Advisory Committee believes that 23 the current oversight of non-annual temporary is 24 satisfactory. 25 And you can concur with 6.12 with the 0032 1 statement that the committee believes the recommendation is 2 vague, if that is still accurate, and the committee has 3 questions about how the suspension of one charity's license 4 would affect the continuity of the bingo sessions in the 5 hall. 6 MS. TAYLOR: I make that -- I make a motion 7 for exactly the way you just phrased it. 8 MR. ATKINS: And before you take action on 9 that, I want to make sure someone on the committee has that. 10 Because, again, we're going to be looking for that from -- 11 from the committee. And if -- you know, if you're going to 12 appoint someone to write up the BAC's recommendations, I 13 could refer them to the report made to the 78th Legislature, 14 the Sunset's decision document. 15 In that document, it's recommendation 6.2, 16 where you would pick up that language that I just read. 17 MR. WHITTINGTON: I think we see your point, 18 Suzanne. 19 MS. TAYLOR: Thank you, Larry. 20 CHAIR BRACKETT: Also, we'll have the 21 official report, too. 22 MR. ATKINS: Well, you're -- you're not going 23 to get that for some time. And again, we're going to be 24 looking for this document from the Advisory Committee by the 25 end of business tomorrow. 0033 1 CHAIR BRACKETT: Excuse the side 2 conversations up here. We're scheduling our -- when we're 3 going to work on this, so... 4 All right. The motion has been made. And I 5 do believe it was seconded. Okay. And we accept the 6 recommendations or support the recommendations in change in 7 statute regarding licensing, which is -- and with the -- and 8 also the management action. And we will be writing up a 9 report regarding our suggestions. 10 All those in favor, please say aye. 11 MR. MOORE: Aye. 12 MR. WHITTINGTON: Aye. 13 CHAIR BRACKETT: Aye. 14 MS. TAYLOR: Aye. 15 MS. GREENFIELD: Aye. 16 MR. MANIO: Aye. 17 MR. PAVLOVSKY: Aye. 18 MR. DOUGHERTY: Aye. 19 CHAIR BRACKETT: Any opposed? Thank you. 20 I believe there's nothing else regarding the 21 Sunset review that we need to consider at this point, 22 correct? 23 AGENDA ITEM NOS. 4 AND 8 24 CHAIR BRACKETT: So we'll move on to Item No. 25 4, which is report and possible discussion on the 78th 0034 1 Legislature 4th Called Special Session. 2 MS. VILLASENOR: For the record, my name is 3 Melissa Villasenor, Governmental Affairs representative of 4 the Texas Lottery Commission. 5 Madam Chair, Members, the 78th Legislature 6 4th Called Special Session convened on Tuesday, April 20th, 7 2004. Attached to your packet is a Proclamation from the 8 governor that specifically states the agenda for the special 9 session. I would like to interject it's a 30-day session 10 scheduled to end on May 19th and the governor can always 11 call subsequent special sessions. 12 Also included in your packet is a legislative 13 tracking report that lists the bills that have been filed. 14 To date, no bills have been filed related to bingo, but it 15 is our understanding that HB 1, by Kent Grusendorf, is going 16 to be the vehicle for public school finance issues. 17 There is language in HB 1 authorizing video 18 lottery terminals at currently licensed horse tracks and 19 Indian tribes. We have also been advised there may be -- it 20 may be amended on -- it may be amended on the House floor 21 legislation related to charitable bingo, specifically to the 22 authorization of electronic pull-tabs and the authorization 23 of multi-halls. 24 That concludes my report. If there's any 25 questions, I'm here to answer them. 0035 1 MR. ATKINS: Again, as you know, Members, the 2 staff of the Division is available to members of the 3 legislature to serve as resources. And we have been 4 contacted by some members of the legislature regarding 5 potential revenue impacts from the two items that Melissa 6 laid out, electronic pull-tabs, or they're also being 7 referred to as instant bingo cardminders and multi-hall 8 bingo, which we understand some people are also referring to 9 as multi-premises bingo. 10 I'll let you know, Members -- and Danny may 11 want to touch on this further when Item 8 -- his work group 12 report comes up. These items have also been discussed in 13 that work group with staff and members of the industry. 14 And we're happy to answer any questions you 15 may have. And I'm sure there are other people in the 16 audience that can also answer questions you may have. 17 CHAIR BRACKETT: Okay. We have quite a few 18 that requested to speak on this. 19 Joe Garcia? 20 MR. GARCIA: Good morning, Madam Chair, 21 Members. Thank you for the opportunity to come before you. 22 I want to -- my name is Joe Garcia. And for the record, I 23 represent the Satellite Bingo Network from Washington. 24 And what I'd like to do is tell you that -- 25 what our activities are in the legislative session. We are 0036 1 advocating for a multi-premises bingo legislation that would 2 allow what's been referred to in the past as satellite bingo 3 or multi-hall bingo. The language that came out of -- the 4 drafting attorney's put it at multi-premises bingo. 5 But I'd like to give you a little information 6 here that y'all can look at while we're discussing. 7 In 1996 in Alberta, Canada, they had a 8 proliferation of casinos and people in the charitable bingo 9 industry started to look at alternatives. And in 1996, the 10 first multi-hall bingo game was launched in Alberta, Canada. 11 And subsequently, under the same pressures, in 1999, 12 Washington state adopted legislation that created multi-hall 13 bingo. 14 There are two key points that we feel are 15 important and critical to multi-hall bingo and the success 16 of it. One is that it allows -- we believe that the larger 17 prize limits that would be allowed under this game would -- 18 would increase attendance. 19 And secondly, the other critical factor is 20 that we think it would provide a level playing field between 21 the smaller bingo halls -- like the VFWs, the Knights, the 22 Elks -- that play occasionally and not as much on the same 23 playing field as the commercial bingo halls. I think that 24 those are the two most important points that we are 25 informing the members of the legislature about the 0037 1 significant effects. 2 If you look at what happened in Alberta and 3 in Washington state, attendance increased in the afternoon 4 games by 23 percent and in the evening games by 37 percent. 5 Also, the spend that was -- by players increased by 22.1 6 percent in the evenings and 11 percent in the afternoons. 7 And the total sales of bingo increased by 12 percent. 8 We believe that multi-premises bingo is -- is 9 something that will help the charities bring attendance and 10 bring additional money. The way the legislation is set 11 up -- and as you can see, these cards are typical special 12 cards and it's a special game. And they're sold for a 13 dollar under the scenario that we plan. 14 And the way it -- the breakout of the monies 15 are is that 50 percent would go back into prizes. 25 16 percent would go directly to the charities off the top. And 17 five percent would go to a facility access fee, which would 18 be paid to the commercial or charity lessor. And 20 percent 19 would go back to the cost of operating the game. 20 We -- the company hopes that -- we have 21 projections that we believe that a bingo hall in a year, 22 that we could have up to 70 million in sales, additional 23 multi-hall bingo, that the state is large enough that we 24 could do a daily prize of 30 to 50 thousand per day. And we 25 believe that that -- the charities' ability to advertise 0038 1 that prize amount will increase attendance, and that it is a 2 traditional form of bingo. 3 I think one of the things that's really kind 4 of attractive among the legislators is that I show them this 5 bingo card and they understand a bingo card. And -- and 6 it -- I explain to them that we set up a studio at a bingo 7 hall where people watch the balls being called. The 8 integrity of the game is being watched. 9 And then I explain to them that this game 10 cannot operate unless there's a bingo ball being called and 11 it's the same thing that you see in a regular bingo game. 12 And so it's a traditional bingo game. And the only thing 13 we're doing is we're pooling all of the bingo halls that 14 want to participate in a game, pooling the sales to create a 15 prize that is bigger than what we normally are limited today 16 of 750 dollars. 17 So that is the proposal we're putting forward 18 and I'll be happy to answer any questions. The cost to the 19 charity will be nothing other than having persons selling 20 these cards. We provide the equipment. We provide the 21 satellite time. We provide the phones. We pay the 22 five-percent facility access fees to allow us to put a 23 satellite dish on the facility. 24 And we think it -- it's an alternative game 25 that has shown much promise in the other areas that it's 0039 1 being played. And that's what we're advocating for with the 2 legislature with some -- some success. 3 MS. TAYLOR: I had one question. I missed 4 some of the percentages. I got 50 percent prizes, 20 5 percent is the cost of operation, five percent was the 6 facility. What was the rest of them? 7 MR. GARCIA: 25 percent to the charities 8 right off the top. And I'll be honest with you. We -- 9 members have been beating us up because our percentages -- 10 they see an eight-percent distribution -- I mean eight 11 percent as a return of yearly figures that's being 12 re-distributed. And we believe that, you know, this is more 13 than triple what is happening today. 14 MS. GREENFIELD: Do the sales from these 15 cards, they go into a -- how do you get the money for the 16 jackpot? They make the money then they send it somewhere? 17 MR. GARCIA: Well, what -- what the company 18 has done in the past, you collect the money for the sales. 19 The way the game operates is -- it could be -- there is a 20 must-go prize. There is some progressives built in to 21 increase the prize. And that -- and every game -- in every 22 bingo hall, there's a consolation winner. 23 And the money will be collected by the 24 charity. Each night they'll do -- take their percentages, 25 the prizes, the consolation prize monies. And what we do, 0040 1 if the big winner -- let's say you get a 50-thousand-dollar. 2 They get a check the next day. 3 And essentially what the company has done in 4 the past is they open accounts at every bank that a charity 5 has an account in. And they just -- the next day you 6 deposit the money into their account minus your cut, minus 7 the charity's percentage and any taxes that may be due. 8 MS. TAYLOR: When you have several charities 9 in a hall -- I'm noticing in here it says like 8:30 at 10 night. Does just the one charity in the hall profit from 11 that game whose session time is at that license time? 12 MR. GARCIA: Well, we anticipate there would 13 be two games, an afternoon game and an evening game. And I 14 think that the management of the -- of the play time by 15 the -- by the halls is going to be critical to everyone 16 getting an evening or under unit accounting -- those are 17 questions that -- you know, that I think most of y'all deal 18 with now on other issues. I think it's the same issue. 19 MR. PAVLOVSKY: Joe, you have an evening game 20 every evening of the week? 21 MR. GARCIA: Yes, sir. Our model calls for 22 two games a day, 363 days. And our projections -- we 23 believe that -- from experiences, we anticipate a six dollar 24 spend per player on this special game that lasts eight 25 minutes. Eight to 10 minutes is the length of the game. 0041 1 And it won't interfere with your current schedule on the 2 games that you have. 3 But we anticipate total sales, based on a six 4 dollar spend, with over 11 million people playing over a 5 year period, about 70 thousand -- 70 million dollars in 6 sales, of which charity profits would be 17 million. And 7 that's -- we consider that a conservative projection, based 8 on what we see in our other states. 9 MR. MOORE: Hey Joe, do you find that the 10 people come in for the one game, spend a dollar and leave or 11 do they stay and play? 12 MR. GARCIA: No. What we found is that it 13 actually increases the people coming in to play your regular 14 bingo game. 15 MR. MOORE: I mean, would it be incorporated 16 in a package or -- because you're saying the model shows a 17 dollar for that game -- 18 MR. GARCIA: Right. 19 MR. MOORE: -- or card. What would stop them 20 from doing that? 21 MR. GARCIA: I don't think there would be 22 anything to stop them from going in and just, you know, 23 coming in and buying five cards and maybe leaving after that 24 game. But I think it's -- and, of course, Mr. Cowan, who's 25 a member of -- the president of the company, couldn't be 0042 1 here. 2 But I'm sure he could give you specifics on 3 that and I'll ask and be happy to provide the committee with 4 information regarding that. But his experience, and 5 discussions we've had with other members of the industry, is 6 basically that it doesn't cannibalize your existing bingo 7 game, that it is a add-on product. 8 And, of course, the beauty of this ad-on is 9 that charities get 25 percent right off the top. 10 MS. TAYLOR: Maybe with that extra 25 percent 11 they could afford to advertise bingo, so... 12 MR. GARCIA: Exactly. 13 MS. TAYLOR: I think -- I like the idea of 14 the additional incentives. I think advertising a bigger 15 payout without costing the charities more than the 25 16 hundred they're paying is -- is excuse enough to do this for 17 any -- I mean, even if we could get the attendance up. 18 Once we've got them in the hall, then we can 19 attack their pockets for all the other stuff. 20 MR. GARCIA: Exactly. Well, one of the -- I 21 will tell you there has been an issue regarding the 22 constitutional question of whether it is allowed. But, you 23 know, as -- and I was talking to the drafting counsel. If 24 you look at the constitutional amendment, it says at a 25 location that is defined by law. 0043 1 And we believe that the draft will have some 2 legislation that gives the Commission the authority by rule 3 to define location by law. But in Washington, they had that 4 same argument. And the way they crossed that argument is 5 that -- is that the bingo game is actually being called at 6 one location and it is at a bingo hall. 7 And they set up a studio and they -- and they 8 do all the production out of that bingo hall. And once the 9 game -- the big game is started, once there's a big -- 10 there's a big winner, everyone drops off. And each 11 individual game -- each individual hall keeps playing the 12 game until they have a consolation winner. 13 So we, you know, explained that to the 14 general counsel -- I mean the counsel at -- over at the 15 legislative counsel to kind of understand what our theory 16 was that, you know, it may start at a single location for 17 the big game, but at the end everyone is playing a game at 18 their -- at their -- at their location. 19 So -- but I just -- I apologize that I had 20 not come before the Bingo Advisory Committee to lay this 21 proposal out. It's gone through various verbiage changes 22 from satellite bingo to multi-hall bingo to multi-premises 23 bingo. So, you know, we just -- we think it would be great 24 for bingo. 25 And like I say, it's a traditional bingo game 0044 1 that members of the legislature don't have a hard time 2 understanding when you show them a bingo card. I mean, they 3 still think bingo is played with hard cards. 4 MR. WHITTINGTON: Let me ask you a question. 5 What's the difference in a bingo hall itself having a 6 progressive game set up in the hall, 20 thousand, and 7 playing for all five charities and getting the other 50 8 percent? 9 MR. GARCIA: Well, actually that's one of the 10 questions that was posed to us, whether we could do a 11 regional game. You know, if you've got -- South Texas wants 12 to do a game or North Texas, that the capability is there. 13 But I think, in my conversations with members 14 of the legislature, is that we -- you know, we're trying to 15 just, you know, crawl before we run. But I don't think 16 there would be any -- any difference. I think what makes 17 the game work is -- in a scenario like that, it may be a 18 smaller prize. 19 But I think our -- what we advocate is a 20 scenario where you're going to do a statewide game. And, 21 you know, the 50-thousand-dollar prize is very conservative. 22 We think it could be, based on the numbers in Texas, a 23 hundred-thousand-dollar prize per night. But it's just a 24 matter of being as conservative and being as -- to give 25 members, you know, a little easiness about it. 0045 1 MR. WHITTINGTON: So basically what I'm 2 saying is that if we get something like that approved, 3 wouldn't the other be approved, too, as far as being a 4 progressive game in the hall? I mean, that would fall right 5 up under it, wouldn't it? 6 MR. GARCIA: Well, I guess that would all be 7 how the rules were written on the interpretation. 8 MR. WHITTINGTON: Because that's what we've 9 been looking for for a long time. 10 MR. GARCIA: Right, Representative 11 Haggerty's -- 12 MR. WHITTINGTON: Yes. 13 MR. GARCIA: -- progressive bingo. 14 MR. WHITTINGTON: Exactly. 15 CHAIR BRACKETT: We have several people who 16 have asked to be witnesses who filled out forms. 17 MR. GARCIA: Thank you. 18 MR. ATKINS: Joe, I just wanted to put on the 19 record -- because I think you touched on several items that 20 we've been discussing with you. Joe has shared several of 21 his drafts of this legislation with us and, again, brought 22 in Mr. Cowan, who he referred to earlier to, I guess, 23 educate us to a degree on how the games are conducted in 24 Washington state. 25 Some of the issues that we've discussed with 0046 1 Joe, from a staff's perspective, include, as he mentioned, 2 there is, I believe, in the current draft a set percentage 3 that would go to the organizations. 4 It has been, I know, also a concern for the 5 members of the Lottery Commission that, in any changes that 6 do occur, that we make sure that money goes to the charities 7 on the bottom line. I think it's somewhat troubling for 8 them that we saw the dramatic increase in both pull-tab 9 sales and total gross receipts, but at the same time we saw 10 a decrease in charitable distributions. 11 So they'd like to be sure that -- that as 12 much of those funds can go to the organizations as possible. 13 Another item that we've talked to Joe about is -- there 14 would be some implementation costs to the agency. 15 One -- and we were just talking about this 16 this morning. There would be potentially some pretty 17 substantial programming costs to the agency. Because, 18 again, the last draft we saw creates a new license class, 19 new reporting requirements, etcetera. And then there would 20 also be a cost to the agency, just in terms of oversight, 21 etcetera. 22 And I bring that up for everyone's benefit 23 because, again, our ability to get that -- those personnel, 24 that funding, etcetera, has a big impact on the speed which 25 with -- with which we're able to implement some of these 0047 1 proposals. 2 MR. DOUGHERTY: Joe, I have one quick 3 question. 4 MR. GARCIA: Yes, sir. 5 MR. DOUGHERTY: If a person wins the big 6 jackpot, are federal taxes taken out or is that by request 7 to their needs, withholding? 8 MR. GARCIA: Yes, we -- we do send out an IRS 9 form. And secondly, there is a provision that allows the -- 10 that the State will receive a prize tax of 10 percent. 11 MR. DOUGHERTY: State will take 10 percent? 12 MR. GARCIA: Yes. This raises about three 13 million on projections, three million dollars a year to the 14 State. 15 MR. DOUGHERTY: Thank you. 16 MR. GARCIA: And right now, I think that's 17 the key element of any legislative proposal, is how much 18 money it brings to the State and funding education. 19 Thank you. 20 MS. MORRIS: My name is Diane Morris. I'm 21 just approaching to remind you, Madam Chair, that this item 22 is a Special Call Session item. And you do have an item, 23 No. 8, that I think Mr. Garcia has gone in great detail what 24 his model and what his legislation would look like. 25 But at the risk of making him come back up 0048 1 and repeat -- and actually that other will allow a lot more 2 discussion and possibly action -- you might want to ask your 3 speakers to keep their comments confined to the legislation 4 or the legislative session that they're talking or wanting 5 to give you information on. 6 And you may want to have some of these 7 questions developed more under Item 8. 8 MR. ATKINS: Well, would it be possible, 9 Diane, for the committee to take up both items with the 10 clear understanding that, should they want to take any 11 action, it would need to occur under Item 8? 12 MS. MORRIS: Yes, I think it could be. But I 13 have to say yes, it could be. But very clearly this is not 14 a lobbying body. State funds are not used for this body to 15 affect legislation. And so, frankly, when these folks are 16 coming up and telling you what they think is good law, I 17 really don't want you voting to agree with them, that their 18 law is good and you are supporting them. 19 So as much as -- it's just -- perfect world, 20 considering them altogether. I want you to be very, very 21 careful if you're going to do that or else ask your speakers 22 to limit their comments on the legislative session on 23 generalities of the bill. 24 I fully believe you're going to have a lot of 25 these speakers back up. And under this alternative style of 0049 1 bingo games, that is a very broad topic. 2 MR. ATKINS: Well, that's -- then Diane, that 3 would be my recommendation to the Chair, in terms of being 4 the most cost-efficient with time, that the committee 5 consider taking up both Items 4 and Item 8 with the caveat 6 that they can have a free-ranging discussion, etcetera. 7 Should the Advisory Committee determine to take any action 8 on any of those items, they would be -- clearly state that 9 they were doing that under Item 8. 10 MS. MORRIS: Yes. Yes. 11 MR. ATKINS: And I further recommend to the 12 committee that they consider -- again, I know there are at 13 least two issues that have been -- or would be eligible 14 under both of these items: One, the multi-premises bingo 15 that Mr. Garcia just talked about; and then the other, 16 instant bingo cardminding devices. 17 So again, for purposes of time efficiency, 18 the committee may want to consider asking if there are other 19 speakers on the multi-premises bingo item and then take up 20 the instant bingo cardminder. 21 And then, if under Danny's report, there are 22 other items, take that up. 23 MS. MORRIS: That's fine. That's fine. So 24 we're all going to be vigilant? 25 CHAIR BRACKETT: Well, good. Because at this 0050 1 particular moment, I'm slightly confused. So at -- what? 2 We're taking up Items 4 and 8 at the same time, which would 3 include the discussion of the multi-hall bingo, as well as 4 the instant bingo cards. 5 We do have some other speakers who would like 6 to speak. Sandra Williams, is she here? 7 MS. WILLIAMS: I'm here, but I would not like 8 to speak. 9 CHAIR BRACKETT: Okay. All right. Charles 10 Hutchings? 11 MR. HUTCHINGS: Good morning. Charles 12 Hutchings, Dallas. I'd like to bring up -- Larry had hit it 13 a few moments ago about progressive bingo. That's -- that's 14 something that I've seen for a long time I thought would 15 help the bingo industry in Texas. 16 So I would like to bring that up and see 17 about having that brought forth and discussed in this open 18 forum. That's all I have. Thank you. 19 CHAIR BRACKETT: Thank you, Charles. 20 William T. Smith? 21 MR. SMITH: I don't. 22 CHAIR BRACKETT: Okay, the two Steves. You 23 can decide who -- 24 MR. WHITTINGTON: The two Steves. 25 MR. BRESNEN: I have handouts today. I've 0051 1 got a bunch of copies over here for people in the audience 2 if you want them. I don't know what the easy way to get 3 them without causing a big commotion is, but maybe we'll set 4 them outside or something. I don't know. I'll let y'all 5 handle that. 6 We really appreciate the opportunity to talk 7 to y'all today, both about what's going on down at the 8 "Ledge" and alternative styles of bingo play. And Madam 9 Chair, I assume we're talking about both those together 10 today, at this point? 11 CHAIR BRACKETT: Yes. 12 MR. BRESNEN: Okay. Good. Let me first talk 13 a little bit about what we've been up to. In your package 14 there, you're going to have a number of different items. 15 One of them is some draft legislation. We've been using the 16 term "instant bingo cardminders." 17 The other, there's two documents that are 18 fiscal impact estimates done by the agency on what happens 19 to us, to charitable bingo if VLTs are authorized. Under 20 one scenario, it's what happens to charitable bingo 21 statewide. And the other scenario is what happens if 22 instant bingo cardminders are authorized. 23 You should also have a white paper that was 24 prepared on behalf of the Coalition to Revive Charitable 25 Bingo, which is active in the session. And I'll tell you a 0052 1 little bit about who that is and what we've been doing. 2 Let me see. What else you got up there? You 3 may have a list of who's in the coalition, but I'll tell you 4 a little bit about -- about that, anyway. 5 And let me back up a little bit. I want to 6 say thanks to Danny Moore for having kicked this discussion 7 off and bringing up the idea. And I think he and Suzanne 8 were instrumental sometime back in getting us focused on 9 getting some new technology into the bingo hall. 10 And so last session, a version of an 11 electronic pull-tab language passed the House of 12 Representatives. In the Sunset legislation, that 13 legislation died. So that effort came to naught. 14 After the last session, anticipating that 15 there would be a school finance session and interest shown 16 by at least some in the legislature of video lottery 17 terminals, we decided that we needed to get behind something 18 to help the bingo halls survive if -- if the -- if video 19 lottery terminals were authorized at the racetracks in the 20 state. 21 Last session, there was a fiscal note on the 22 VLT legislation that said that bingo would be hit by 11.8 23 percent -- or the state prize fees would drop by 11.8 24 percent if VLTs were authorized at the racetracks. 25 Well, in the intervening months, the idea of 0053 1 also allowing the three Indian reservations in the state to 2 have video lottery terminals came up. And we quickly 3 realized that there was some momentum behind that idea and 4 started organizing ourselves and talking to people in bingo 5 all over the state. 6 Ronnie Baker was instrumental in helping us 7 make contact with a number of people. And we had some big 8 meetings in which a lot of people came, including a lot of 9 people in this room and some of y'all. And we decided to 10 unite behind an electronic version of instant bingo, same 11 rules, same prize limits, powering the Commission to audit 12 the machines in the same way the cardminders are audited, 13 and basically to be able to have a game with predetermined, 14 finite number of winners moved up to an electronic platform. 15 A lot of people showed a lot of interest. 16 One of the things that we were interested in, if we were 17 going to do that, was to make sure that we had a robust 18 market with lots of competitors at the manufacturing level. 19 For a long time, I've been sort of amazed at the slow 20 development of technology in the bingo halls. 21 Everywhere else -- I think my watch will do 22 more than some of that stuff. And so I've been asking a lot 23 of y'all and talking about that. And we decided one of the 24 things we need to do is have lots of competition in as broad 25 a -- broad an approach to that, as many manufacturers as we 0054 1 could in the marketplace to try to get the best technology 2 and to drive the price down as low as competition would do. 3 Let me segue just for a second to the charts, 4 because I see Suzanne looking at them. And I think there's 5 been several things said today that I think really have to 6 be kind of put into perspective a little bit. The first -- 7 then we'll -- I -- Steve, it would be my idea to come back 8 and talk about the legislation and have you walk them 9 through it and tell them exactly what it does and all that. 10 And I think there will be a lot of questions. 11 Is that okay with you? 12 MR. FENOGLIO: (Nodding) 13 MR. BRESNEN: The first chart, basically, is 14 an adaptation of the chart that Charitable Bingo Division 15 did in the 20th anniversary report. We just updated it for 16 the couple of years that have occurred since that time. 17 And you will notice that it graphically 18 represents the rise and decline of charitable bingo. In the 19 white paper that you have in front of you there, I've sliced 20 the numbers about a dozen different ways. And I think, when 21 you read it, you'll see that what's happened to charitable 22 bingo has really been -- not only -- been counterintuitive, 23 to say the least. 24 I say that because, at the same time that we 25 were declining 115 million dollars a year, the state's 0055 1 population was growing dramatically by about 25 percent and 2 the disposable -- not disposable, but the net income, per 3 capita income in the state was driving -- was rising 4 dramatically. Obviously, in '92 the lottery came in. And 5 from '92 on you can see the decline to charitable bingo. 6 I went back the other day and looked to see 7 what the percentage received by charities after prizes was 8 in 70 -- in '91, rather, versus last year. And I'm talking 9 net revenue, not just distributions. And at that time, the 10 percentage of revenue after prizes that went to charities 11 was over 25 percent. 12 I think it was -- in fact, it may have been a 13 little over 26 percent. I didn't have the numbers, so I had 14 to estimate prizes at about 70 percent of the -- of that 15 gross revenue number. Last year it was a little over 20 16 percent. 17 It became clear to me that, if we can drive 18 the revenue up, we can improve the percentage going to the 19 bottom line of the charities. It also became clear to me, 20 as we went through this, that those numbers, the 575 million 21 dollars, the six hundred -- for last year, the 673 million 22 dollars in '91 don't mean a thing. 23 And if you'll look in your Sunset report, you 24 will see that they don't report their revenues in the way 25 bingo does. And the reason is -- and we're finding this out 0056 1 in the legislature. We got -- we got -- we need to change 2 this and I'm going to put this in legislation. We're 3 bringing this up because it's going to happen in this 4 special session that I'm going to get a hearing on this. 5 But it occurred to me -- and I've showed some 6 legislators this -- that if I -- if I'm a charity and I 7 sell -- I've got six pull-tabs to sell and I sell four of 8 them and you pop them open and there's a 50-cent winner, 9 that's one dollar in sales. If you give me back the 50-cent 10 winner and get two more, that's $1.50 in sales but I only 11 have a dollar to pay my bills. I only got that dollar in 12 cash that you walked in. 13 What we -- what we need to focus on is 14 getting our revenues up. And we think we can do that with 15 this instant bingo cardminder legislation. And we think 16 that we could drive the percentage, after -- after prizes, 17 to the charities up substantially. 18 The second chart in your packet there shows 19 the estimate of revenue to the State. That's basically the 20 change in the prize fee. You can see out to the right-hand 21 side of that chart there that, without -- if VLTs are 22 implemented, without -- and we don't have a product to 23 compete with, revenues from the prize fee drop by 6.8 24 million dollars. 25 If we do, on the other hand, get a 0057 1 competitive product, the staff estimates that revenues from 2 the prize fee would go up 13.5 million dollars. That's a 3 substantial swing for the State. 4 The next chart shows what happens to gross 5 revenues. The staff's estimate -- it's either a decline of 6 189 million dollars, if we don't have a competitive product, 7 or an increase of 300 million dollars. Now that -- you 8 know, that includes a lot of factors. I think -- Billy, 9 correct me if I'm wrong. But I think that assumed 10 10 thousand machines that would offer that product. 11 So, you know, nobody knows how many machines 12 there will be. There's about 20 cardminders, maybe a few 13 more than that now. So we don't -- we're not -- we're not 14 sure how many machines would offer -- would offer the 15 product in the future. 16 But that gives you a -- a way to see 17 graphically what the swing can be if the legislature 18 authorizes the use of this product. 19 Why don't I stop for a minute and let Steve 20 walk you through the bill language that you have in front of 21 you and explain to you why we've done what we've done and 22 what you're -- what you're seeing there, what might be -- 23 what might be allowed. 24 Let me -- does anybody have any -- well, let 25 me -- while he's getting ready, let me tell you what we did. 0058 1 We decided we needed -- just like with the positive agenda 2 last time in 2519, we need to get as many people in bingo on 3 board and pursue a united effort on this. 4 So we have the distributors association and 5 the distributors individually. Ken Griffith, Jane Thompson 6 over at Thompson Allstate -- who am I leaving out -- Danny 7 Moore, a number of other people involved at that level. We 8 have the VFW, the Elks, AmVets, the Redmen. 9 And I'm -- my fax machine is filling up with 10 organizations signing on the line and signing onto the 11 program. I think we're up over 500 right now. That 189 12 million-dollar loss that was projected if we don't get a 13 product is concentrated in the areas around the tracks and 14 the tribes: Dallas/Fort Worth, Houston, Corpus Christi, the 15 Valley, Austin, Laredo if there's a track built in Laredo. 16 And assuming that legislation allows the ones 17 without a track, Amarillo could be in the same -- and 18 Lubbock could be in the same situation. 176 million dollars 19 of that is out of the areas concentrated in the track areas. 20 And we're getting a lot of help from people in those areas. 21 We also have Gametech, Bingo King, Multimedia 22 Games, Bettina, Diamond International -- let me think. 23 What's their name? 24 MR. MOORE: International Gameco. 25 MR. BRESNEN: It's International Gameco and 0059 1 Diamond Games. Who am I leaving out? 2 MR. MOORE: Fortunet. 3 MR. BRESNEN: Fortunet, Bettina. 4 MR. MOORE: (Inaudible), are they involved? 5 MR. BRESNEN: I don't know if they're 6 actively involved, but they've attended some -- some 7 meetings. Of course, the Texas Charitable Bingo 8 Association, the Bingo Interest Group all involved, 9 everybody pulling in the same direction and looking forward 10 to finding our way into the legislation on school finances 11 moving during the session, if it -- if it moves. 12 It's been -- it's been sort of fits and 13 starts the last few days. They've canceled a lot of 14 meetings. They're going to come out with another bill on 15 Saturday. And we think probably the middle of next week 16 that legislation will start moving. And we're going to do 17 everything we can to be in it and deliver a substantial and 18 interesting new product to bingo players. 19 Why don't I stop for a minute and see if 20 anybody has any questions about anything I've said so far. 21 MR. ATKINS: Steve, I don't have any 22 questions, but I'd just like to follow up kind of like I did 23 with Joe. You've shared with us a lot of those drafts and 24 some of the issues that we've talked about so that the 25 Advisory Committee has the benefit of that. 0060 1 Again, two of them, I think, are the same. 2 We're going to be very interested in, you know, trying to 3 get some kind of language that will, you know, make sure 4 money is driven to the charity's bottom line. 5 I can't remember if you referred to it or 6 not, Steve. There was a lot of concern when the cardminders 7 came in initially, the cost of those devices. So what we'd 8 like to do is try and make sure where we can that money goes 9 to charities, the -- of course, the cost to implementation, 10 in terms of staff, etcetera. 11 And also, something else that is being 12 discussed is the possibility of -- with these devices, 13 possibly electronically sweeping accounts for the prize 14 fees. It's something that the lottery does with retailers 15 and has proven to be very successful for them and -- and 16 relatively simple for them, also. 17 MR. BRESNEN: Let me say, we've been 18 committed. We've talked with the staff a lot about their 19 need to have the resources to implement this. It's going 20 to -- it's clear to me, from the testimony around the 21 legislature, that it will take some time for VLTs to get 22 implemented in the state. 23 They're talking about putting four or five 24 thousand machines at a given location. Most of those places 25 are going to have to have some bricks and mortar added to 0061 1 them to put that many machines in them. And there will be 2 rulemaking and contracting and all kinds of stuff that will 3 need to be done. 4 At the same time, we don't want to be too far 5 behind the curve. And if possible, we'd like to be ahead of 6 the curve. And we've had some discussions about -- we had a 7 real good experience with the way the authorization of the 8 new instant bingo products a year or so ago was handled 9 where everybody had a deadline to apply by and they all got 10 approved at the same time and everybody got to market it at 11 once. 12 We think that that's a real good model and 13 would like to see it happen again. On the other hand, we 14 would like to see that the staff have adequate time to do 15 the testing and approve the products and also manufacturers 16 who may not be in the marketplace -- of course, nobody knows 17 what the product might look like. I mean, we have some 18 examples of what it might look like, but we don't know what 19 the statute's going to read like, what the rules would be. 20 So that everybody will need a fair 21 opportunity to adjust their technology to whatever the state 22 of the law is and then come down here and make their 23 application and get approved and get out into the 24 marketplace. 25 So we're balancing the need for speed and the 0062 1 desire to quickly get interesting products to the bingo 2 player with the notion that this market's got to be set up 3 in a way that it works productively for everybody. 4 Steve, you want to take over and talk them 5 through the legislation and show them what you got? 6 MR. FENOGLIO: Sure. For the record, my name 7 is Steven Fenoglio. And we have -- sometimes pictures tell 8 a lot more than just dry words. These are prototypes of the 9 pull-tab -- a pull-tab electronic play. And, of course, 10 everyone knows what pull-tabs are, but we brought some 11 samples. 12 MR. ATKINS: This is -- 13 MR. FENOGLIO: Yes, it's the same one that we 14 demonstrated in the -- Danny Moore's subcommittee. And it's 15 pretty easy to figure out. I bet Jack's already figured it 16 out where you hit the push ticket button and you're now 17 going to -- and you can either hit them individually or you 18 can open them like that. 19 And it tells you right here that you're a 20 winner. Graphically, what we're doing in legislation is 21 putting these pull-tabs, digitize them and put them on 22 screen, the same way that you do the cardminder, where you 23 digitize the paper, put it on a screen and play. 24 And it shouldn't surprise anyone that, as the 25 computers become more and more universal in all our lives, 0063 1 that people play with computers. And we think it will -- 2 and I'm glad the staff agrees that this type of game will 3 increase the player appeal excitement in the hall. 4 So basically the bill is pretty simple. And 5 if you start out -- and the first section has to do with 6 definitions. And this, by the way, is a mock up. That's a 7 cardminder by Fortunet. That was -- that's one of the 8 coalition members. They got us a prototype so we could 9 show, do the show and tell. 10 But you play it -- you can play it on an 11 existing cardminder. We anticipate some manufacturers will 12 have cardminders that will play both regular bingo and 13 electronic pull-tab bingo. We anticipate others may have a 14 traditional cardminder style that would play just electronic 15 bingo. 16 And if you think in terms of your halls today 17 where you've got 21-inch touch screens on a table, they 18 could do the same thing with that, have much richer 19 graphics, obviously, than that prototype. Some of the newer 20 handhelds coming out have a lot richer graphics. The bill 21 would allow for entertaining sounds consistent with what the 22 Commission already approves, as far as the graphics, nothing 23 can be offensive to the Commission's -- what I called 24 previously their police who decide if a graphic is approve 25 -- okay. 0064 1 The other type of machines that would come 2 in -- and Steve alluded to it -- would be either stand-up or 3 sit-down terminals that you could put on the sides of the -- 4 of the hall. And you could have your regular bingo. And 5 then if people did not want to play regular bingo, then they 6 would not be part of the play, if you will. They'd be on -- 7 the machines would be on the side wall. 8 Basically, though, it comes down to three 9 common elements. And the first is -- within the statute, is 10 you've got a point-of-sale or we call it site control. And 11 today on the cardminder, that's what you have. They call it 12 a point-of-sale system. Every manufacturer has it, where 13 you go up to someone and obtain the products you're going to 14 play. And that would be the same case with this product. 15 We call it a site control. You go up. You 16 give someone some money, a debit card. It could be a power 17 card, if you will, you know, something that looks like this. 18 This is a Debitech smart card that's issued by the cafeteria 19 at the Capitol and you put money on it. So you could go to 20 the point-of-sale or site controller and give them that 21 card, if you will. 22 That card could maintain your winnings on it. 23 Smart card technology is, you know, player customer card 24 technology -- Dave and Busters, if any of y'all have ever 25 been, have a Power Card, they call it. And you could do the 0065 1 same thing. 2 In any event, so you've -- you've purchased 3 your product. Now you're going to go play it. If it's a 4 cardminder portable, obviously, you take it -- they give it 5 to you and you take it. That's the second. It could be a 6 table-top model or it could be a model that's stood up 7 against the wall or in another area, if you will. That's 8 the second. 9 That's -- and you -- I think everyone can 10 visualize, when you see it, that's what this pull-tab bingo 11 is about. And the -- the third issue is the back-end audit 12 capability, which, as y'all know, there is significant audit 13 capability with cardminders today. And that is in this 14 legislation. 15 I can -- I'll be happy, Madam Chair, to go 16 over, line by line, page by page, the legislation. But 17 that's the sum and substance. All of it resolves around the 18 paper pull-tabs. All of the rules and regs that are 19 existing in paper pull-tab would apply to this electronic 20 pull-tab. 21 And by that I mean it's a finite deal. It 22 may be a, quote, virtual digital deal that has preapproved 23 winners shuffled within that virtual deal. The 750-dollar 24 prize limitation applies and everything else about paper 25 pull-tabs would apply to that. We're just taking these 0066 1 paper pull-tabs and digitizing them. 2 And that's the sum and substance of it. And 3 again on the back-end, audit -- as you know, there's a lot 4 of audit capability, more security, if you will, because 5 when you put your money -- when you buy the product or rent 6 the cardminder today, there's -- a sale is rung up and it 7 sure makes the audit trail a lot easier. We think the same 8 would be true with these. 9 I'll be happy to answer any questions. 10 MR. WHITTINGTON: Well, I just want to 11 comment on what you said about the electronic pull-tab. 12 Over the years in bingo, we've lost a lot of customers 13 because of the inundation of casinos in Louisiana and 14 Oklahoma and, of course, in Texas alone. 15 That created a lot of bingo customers to 16 enjoy these games, which we can't have anymore in our bingo 17 halls. Most of my customers come in. They're very bored 18 because they come to play bingo. And we'll try everything. 19 We'll try to sell pull-tabs at the -- at the first hour of 20 our session, which one session has four hours. 21 And we'll try everything. We cannot get them 22 in early. They come in to play the bingo game and that's 23 it. They say they need something to do. And they can look 24 at this paper pull-tab all they want. But an electronic 25 device, they will come in earlier to play it. I know that 0067 1 for a fact because that's what we're creating, that type of 2 customer. 3 That's why we're losing customers because 4 they're going other places, like Louisiana or back door 5 eight-liner shops just to play. We're losing our customers 6 because they love it. And if we don't have anything to 7 counteract that, we're all going to see a big decline in 8 bingo over the next year. 9 And I'm behind this a hundred percent because 10 we need something exciting to get these people in these 11 bingo halls in the future, some -- a new innovation. And I 12 think this will be such a good tool to get some of our 13 customers back, because they will go to the racetracks more 14 because they love it because that's what they know about and 15 that's where they -- they're going to go if we don't do 16 something to counteract. 17 That's all I wanted to say. 18 MR. FENOGLIO: And I will say, Madam Chair, 19 that we did demonstrate this product to the work group that 20 I'm a member of that Danny Moore chaired and the commission 21 staff, I think, had about five or six people to view it. I 22 understand that another manufacturer has come in and 23 demonstrated another prototype. And I think there are two 24 other manufacturers scheduled to come in. 25 But they're all going to have similar 0068 1 components, structures, if you will. They may look -- the 2 terminals actually may look differently, the player 3 stations, if you will, but they're all the same concept. 4 And I believe we discussed it back on -- 5 March 22nd was when we did the demo with -- Suzanne and 6 Danny were virtually at the meeting via telephone. 7 MR. MOORE: Actually, that meeting was on the 8 13th, I think, of April that we -- you showed the staff the 9 equipment we're looking at here. On the 22nd, we talked 10 about progressive bingo, multi-hall bingo, sales of 11 pull-tabs, alternative locations and, of course, instant 12 bingo cardminders . 13 The second meeting we had on the 13th is when 14 you made the demonstration to the staff. And that's when 15 the conversation turned towards sweeping the machines or the 16 accounts, which we were not against. It's just actually a 17 new approach for us in bingo. 18 So we understand that the staff has a lot of 19 expenses if this were to take place. So that's all 20 conversation that I'm sure will move forward at this point. 21 MR. FENOGLIO: And I will say that we've been 22 sharing the drafts of the legislation with staff. Bill and 23 Phil both had, I guess, about four -- three pages of 24 questions. And I've met informally with Phil over at the 25 legislature and several of us are going to meet with him 0069 1 tomorrow at 10. 2 So I'll be happy to go on, Madam Chair. 3 MS. GREENFIELD: I have a question. I'm just 4 curious if you have to have a separate machine or if they're 5 going to maybe try to put them on the cardminder machines 6 that are already out in the halls so the stationaries and 7 the handhelds be used for bingo paper. 8 MR. FENOGLIO: Good question. We anticipate 9 that some manufacturers will put them on their existing 10 cardminders Obviously, it would require a retro-fit 11 software, primarily, although there will be some hardware 12 changes. 13 Other -- I mean what -- we've talked with 14 manufacturers. Some will play on existing cardminders some 15 will have, perhaps, cardminder type machines devoted solely 16 to playing these type of games electronically. 17 MR. BRESNEN: What we tried to do is 18 authorize the widest variety of technology but not require 19 anybody to use a particular mode except having the functions 20 for audit and central communication system so the Lottery 21 can efficiently keep track of what's going on out there. 22 Any other questions about that subject? Let 23 me just -- let me disclose something that I'm working on 24 during this special session that could go into that 25 category. So I'm not really looking for y'all to take any 0070 1 action on it or anything. 2 I've been convinced that this -- that we're 3 getting a bum rap at the legislature on the numbers. And I 4 have spoken with the staff of the Licensing and 5 Administrative Procedures Committee that has oversight and 6 responsibility over charitable bingo and the Lottery 7 Commission. And I've spoken with Phil some and Commissioner 8 Cox and others about the way we report these numbers. 9 And the little demonstration that I tried to 10 do earlier, I think, has -- has disclosed to a lot of people 11 in a graphic way that we've got -- we have to get a better 12 way of communicating what the charities actually get out of 13 this. This -- the concept of distribution, if you look in 14 Sunset report right now, I mean, we're -- it's the same view 15 of that 575 million as being cash into the hall. 16 That's not cash into the hall. And my 17 creditors only allow me to pay them with revenue that 18 actually exists out there and not my replay revenue that 19 I've swapped back and forth. So I think we've got to get a 20 better way of doing that. 21 We've discussed with some folks about 22 modeling in some individual halls. I've asked the staff of 23 the Licensing Committee to get with Chairman Flores. And 24 I'll get with him when he comes back next week and ask him 25 to have a hearing. I think the 4th Called Session is going 0071 1 to become a 5th Called Session maybe. 2 So hopefully before the 4th Called Session I 3 would like for him to take some action that will get a 4 discussion started about the way we talk about bingo. I'm 5 not faulting anybody. This is a 20-year -- I used to be at 6 the Controller's office when the Controller's office 7 regulated bingo. 8 And it was the same approach then. And 9 it's -- it keeps us constantly talking about something 10 that's really unreal. We're talking about, you know, five 11 or six percent or eight percent getting to the organization, 12 but that's not the after-prize amount that gets to the 13 organization. 14 On the other hand, Billy and the 15 commissioners are rightly concerned that when the -- when 16 these numbers go up and the charitable distribution doesn't 17 change or stays the same, that it's -- that, you know, 18 what's happening out here. There seems to be more play 19 going on and no more money getting into the distribution 20 category. 21 I'm just looking here. This -- these are two 22 charts that Phil produced off the system from '03 and '02. 23 And I notice that, from '03 to '02, rent went down by a 24 million dollars and other expenses went up about a million 25 dollars. So that's a wash. Everything seems to be a wash, 0072 1 except we had much higher -- we actually had a little 2 decrease in regular card sales. 3 But instant sales went up dramatically. And 4 prizes went up dramatically. So, you know, the question is: 5 What do these charities have out there in their accounts? 6 What proceeds have not been distributed? What's there? 7 What's happening in those accounts out there? What's their 8 net revenue? 9 This -- this chart does not produce a line 10 that says net revenue to charities. And so we -- we need to 11 change that discussion. And I'm going to try to change it 12 during this session. And we'll be looking to work with 13 y'all and Billy and staff and the commissioners and try to 14 get on an analytical basis that can be defended in the real 15 world out there -- let me tell you why this is -- actually, 16 it was kind of humorous. 17 I think it made our point without us ever 18 having to bring it up. In front of the House Committee the 19 other day, the House members wanted to know how much in 20 sales VLTs would have to generate to produce the some-odd 21 billions of dollars that the State expects to get out of 22 VLTs. 23 And the testimony there was 26 billion. And 24 that caused everybody to gulp. The next day when we went 25 over to the Senate Committee, that number was more like 58 0073 1 million and everybody gulped twice. But they said wait, 2 wait, wait, wait, wait, wait. That's not cash going into 3 these machines. That's all just replay and this churn. 4 Well, it -- it made the point. And we have 5 got to quit talking about this churn and get down to how 6 much money is actually out there and how much of the 7 charities actually get -- I intend to do everything I can to 8 get the House Committee on Licensing and Administrative 9 Procedure to take that up in a hearing pretty soon to at 10 least get the conversation started. 11 And I would expect -- I would hope that it's 12 within your work plan. If it's not within your work plan, I 13 would like to see your work plan amended. I know that's 14 later in the -- later in the agenda, but -- to get that 15 discussion started so we can get on a basis that gives us a 16 more accurate view of what's going on out there. 17 Thanks. 18 CHAIR BRACKETT: Are there any other 19 questions that anyone has that they'd like to ask them while 20 they're here? Danny, do you have any comments on this, this 21 Item No. 8? 22 MR. MOORE: Well, yeah. I mean, I should 23 segue back to the subcommittee. I probably should have went 24 there first. The first meeting, like I said, was March 25 22nd. It was Billy, Phil Sanderson, Shane Woodard, myself, 0074 1 Suzanne and Steve Fenoglio. 2 We took a couple -- we took four items, 3 actually, in the first meeting. And this group is supposed 4 to look at alternative styles of bingo or games that are 5 played with bingo. And we started talking about progressive 6 bingo, which has been legislated in the stage that -- it 7 actually passed the House and Senate and was signed by the 8 governor, I think, in '99. 9 Am I wrong or is that right? It was House 10 Bill 2119. 11 MR. FENOGLIO: 25? 12 MR. MOORE: I'm looking at 2119 here. 13 MR. FENOGLIO: Was that the progressive? 14 MR. WHITTINGTON: Yeah. 15 MR. FENOGLIO: Yeah, that was '01. 16 MR. WHITTINGTON: '01. 17 MR. MOORE: But the conversation moved 18 forward and we talked about whether we should have a limit 19 on progressive games. We talked about a lot of people are 20 concerned about the fact that people move around and follow 21 jackpots from hall to hall. But in the end, I think we had 22 a consensus that we would move forward something without a 23 limit on them. 24 There's -- there's a lot of thought on 25 progressives. I know that the staff has actually done some 0075 1 research in other jurisdictions. Progressive bingo is 2 played in a lot of other states. It's usually limited to 3 maybe one per day at a lot of locations in different states. 4 I've seen an article about a VFW in Michigan 5 that it -- similar situation in Texas where you have, you 6 know, gaming in Louisiana, Oklahoma, they have the same 7 thing in the Detroit metro area. Indiana had some big pots. 8 And I won't say much about it, but the VFW commented that 9 they were teetering on going out of business and that these 10 progressive games actually turned them around and made them 11 successful again. 12 So there is some history. It's something 13 that we need to look at again. So we're going to continue 14 to research progressive bingo. 15 Multi-hall bingo, Joe just talked about that 16 a little bit. That's been going on in Canada for years. 17 Washington state seems to be a closer model to what we have, 18 I think. The big hang-up here, from our conversations, 19 Billy, was the constitutional amendment possibly of playing 20 bingo in one location. 21 I've been -- since those meetings, I've kind 22 of heard through the grapevine that maybe it's okay. I 23 don't know if you have any more input on that, as far as 24 bingo being played in two different locations or more than 25 one location. Have you done any research or has there been 0076 1 any further input on that? 2 Because this is the first time today that I 3 heard that actually we're going to try to do some 4 legislation on that this time around. 5 MR. ATKINS: I'm sorry? 6 MR. MOORE: I was just curious, as far as the 7 multi-hall bingo. You know, we had -- in our discussions, 8 we talked about the problem with the constitutional 9 amendment, whether there had to be one to play bingo in more 10 than one location. Has there been any other thought on 11 that, as far as it -- because we said satellite bingo. 12 Maybe we should call it something else. 13 MR. ATKINS: No. I mean -- and Joe 14 referenced the fact that we'd -- we've discussed that issue. 15 And I think it boils down to -- you know, no offense to 16 anyone that's in the room, be if -- you know, if you talk to 17 two different lawyers, you can get eight different opinions. 18 So, I mean, I don't -- I don't know if we 19 know anything definitively. It's just an issue that, you 20 know, I think has been raised in good faith. You know, I 21 don't know if Joe has anything else. 22 MR. GARCIA: Danny, I'll just tell you that, 23 in my conversations with the drafting counsel for the 24 legislative counsel, we had a long discussion. And 25 basically, she said it's up to whether you want -- if there 0077 1 would be a challenge. You know, it would be up to a court 2 to decide whether it -- you know, interpretation of the 3 statute, as Billy said, would fall on, I guess, who it went 4 to. 5 But like I said, our -- in our theory and my 6 discussions with her was that we thought that the language 7 in the constitutional amendment that passed back in the '80s 8 kind of leaves a door open that -- defined by law. And we 9 think that the legislature has the authority to give the 10 Lottery Commission that -- that authority to define it by 11 rule. 12 So we're working on the premise that -- that 13 language will be added that gives you, the Commission, the 14 authority to do that and go from there. 15 MR. MOORE: Okay. 16 MR. PAVLOVSKY: Madam Chair, I have a 17 question. Steve, in this packet, How to Help Charitable 18 Bingo in Texas, is progressive bingo in here? 19 MR. FENOGLIO: For the record, my name is 20 Steven Fenoglio. No, it's not. That is paper that gives a 21 history of bingo and is building toward the IBC. 22 MR. PAVLOVSKY: Okay. 23 MR. FENOGLIO: Our concern has been, and I 24 think staff agrees, that if -- well, one of the key premises 25 was that if VLTs are put in play at licensed racetracks, 0078 1 what will that do for charitable bingo. And the staff has 2 provided to legislature a paper that says charitable bingo 3 goes down by at least 190 million dollars. 4 I don't -- I think if you're in Corpus 5 Christi and there are four thousand VLTs at the dog track, I 6 don't think -- without a comparable product, I don't think 7 we'll be even with all that, as you know bingo today. You 8 may have more or less a VFW style model, if you will, which 9 would be very much a minimal, de minimus social game. 10 The same is true in the Dallas area. I mean, 11 one of the discussions of the legislature was that hall -- 12 that racetrack in Grand Prairie. Lone Star is going to get 13 eight thousand or up to eight thousand VLTs. The largest 14 casino has 23 hundred in Vegas, to give you an idea of a 15 comparison. 16 So our premise was: There's this big bus 17 that's coming down the road. My clients don't oppose, per 18 se, VLTs. But if you're going to have VLTs, bingo ought to 19 have a comparable product or else there won't be bingo as we 20 know it today. 21 So that -- and we did not feel that a 22 multi-hall or progressive would be a comparable product. I 23 mean, we're not saying that we're not supportive of those. 24 But, you know, you better have a comparable product first or 25 you won't be around to talk about multi-hall or what have 0079 1 you. 2 And on the one issue that Danny alluded to on 3 the legal issue, you know, I am a lawyer but I don't really 4 have an opinion. Although if someone paid me to, I probably 5 would. On the issue of the location, it is a serious 6 question. My only -- and we asked. I think Danny and I 7 both asked for some research on that issue. 8 We haven't seen -- at least I have not seen 9 it on the issue of if a multi-hall is constitutionally 10 permissible with the prohibition or the statement in the 11 Constitution that says bingo is conducted at one location as 12 defined by law, if you will. 13 And my only point on that is -- I mean, any 14 -- any -- I think I'm on the same page as Suzanne. Any tool 15 that gives charitable bingo a competitive benefit is a good 16 thing. And the -- let the industry or the market decide if 17 a hall wants to have progressive and a multi-hall, either/or 18 or both IBCs, but let's not put all our eggs in a basket 19 like the -- most of the charitable bingo industry did with 20 the progressive in '01 and it gets vetoed because of, you 21 know -- I mean, no one opposed that progressive bingo. 22 The staff acted as a resource and said some 23 kind things about it, but it got vetoed. And similarly, I 24 don't think you ought to put all your eggs in one basket if 25 there's a serious constitutional issue without investigating 0080 1 those constitutional issues. 2 And again, I don't have an opinion on it, 3 other than you've got this challenge of -- Suzanne's hall 4 and Mario's hall are going to be part of that multi-hall, 5 assuming they both joined it and it became legal to do so. 6 So you are conducting bingo at two different locations. 7 And I do recognize the legislature or the 8 drafters of the amendment gave some wiggle room. I just 9 don't know how far the wiggle room goes. 10 MR. MOORE: To continue, as far as the -- the 11 second meeting, the staff had quite a few members there. I 12 can read them off, but it was pretty much everybody was over 13 there, Billy. I think it was Kim Kiplin, Kevin Oldham, 14 Terry Shankle, Collin Black, Homer Gonzalez and the members 15 of the subcommittee. 16 The only model they saw was this one here, 17 the Fortunet model. I have contacted the other 18 manufacturers that would possibly be interested in instant 19 cardminders and they're supposed to bring whatever they can 20 show. It's -- a lot of them, it's just conceptually being 21 developed right now. 22 But we're going to keep moving forward. I'm 23 sure the subcommittee will meet again. We do have other 24 items to cover. We talked about the possibility of playing 25 pull-tabs in other locations that are -- Minnesota plays in 0081 1 the barrooms. We talked possibly that the way to move on 2 something like that would be to have them played in VFWs, 3 American Legions maybe as a small step. 4 But right now the subcommittee's really 5 working on instant cardminders Suzanne, you want to add 6 anything? 7 MS. TAYLOR: Yeah. I'm going by these nice 8 minutes that we have right here. This is a draft set of 9 minutes, but -- this is under Item 8. This is our draft of 10 minutes, but -- 11 CHAIR BRACKETT: From your committee? 12 MS. TAYLOR: From the committee meeting. We 13 did agree to recommend progressive bingo with no limits as 14 to the side -- to the whole BAC for a vote, that that was 15 the committee recommendation that we move ahead with that as 16 the same way it was in House Bill 1317. 17 And we also agreed to recommend instant bingo 18 cardminding proposal, according to our minutes. So those 19 two items we -- we liked and wanted to recommend then to the 20 whole BAC. 21 CHAIR BRACKETT: Okay. So this is the action 22 that's recommended by the committee, the action that the 23 Bingo Advisory Committee -- they're asking us to take, that 24 we agree to recommend progressive bingo with no limits on 25 the size of a particular hall, which is similar to House 0082 1 Bill 1317. 2 MS. MORRIS: May I clarify? 3 MR. ATKINS: She's -- she's doing this under 4 Item 8. 5 MS. MORRIS: Thank you. Now who are you 6 recommending this to? 7 MS. TAYLOR: The work group is recommending 8 it to the BAC. 9 MS. MORRIS: Okay. 10 MS. TAYLOR: To -- to the full committee. 11 MS. MORRIS: Okay. 12 CHAIR BRACKETT: Okay. And we accept that 13 action, correct? 14 MR. WHITTINGTON: Uh-huh. 15 CHAIR BRACKETT: And the work group also 16 voted to recommend the instant bingo cardminding proposal. 17 And at this point in time, is there any other action on 18 that? Danny, that's your group, so -- 19 MR. MOORE: No. 20 CHAIR BRACKETT: Does this make it to where 21 it will be pursued with -- 22 MR. ATKINS: That -- this makes it the 23 Advisory Committee adopting the work group's recommendation. 24 It's up to the Advisory Committee if they want to make a 25 recommendation to the Commission that they want to consider. 0083 1 MS. GREENFIELD: I make a recommendation that 2 we recommend it to the Commission, Lottery Commission. 3 CHAIR BRACKETT: Okay. You're putting this 4 in the form of a motion for a vote by the -- 5 MS. GREENFIELD: Yes. 6 CHAIR BRACKETT: -- Bingo Advisory Committee 7 that this be recommended to the Lottery Commission? 8 MS. GREENFIELD: Yes. 9 CHAIR BRACKETT: Okay. All of you understand 10 what the recommendation is? You don't need it repeated for 11 a vote? 12 MR. DOUGHERTY: Repeat it, please. 13 CHAIR BRACKETT: Okay. The work group agreed 14 to recommend progressive bingo with no limits on the size of 15 a multi -- no size on a particular game, which is similar to 16 House Bill 1317. 17 And the second was the work group voted to 18 recommend that -- the instant bingo cardminder proposal. 19 Let me get a second. And then you can speak, 20 Mario. 21 MR. PAVLOVSKY: Second. 22 CHAIR BRACKETT: Mario, I can tell by looking 23 at him -- 24 MR. MANIO: I'm just confused. What are we 25 going to recommend to whom, because these matters are in the 0084 1 form of a House Bill for the special session. And whether 2 we make a recommendation or not probably has no bearing on 3 the -- what's going to happen in the -- in the special 4 session. 5 CHAIR BRACKETT: I -- Steve? 6 MR. BRESNEN: Steve Bresnen on behalf of the 7 Coalition to Revive Charitable Bingo. Mario, I think it's a 8 real good question, but I do think it will have a bearing. 9 And one of the things that I was going to ask y'all to do -- 10 I think the next Commission meeting is sometime in the 11 middle of -- middle of May. Am I right about that? We 12 don't know yet? 13 I'm a little concerned that, if your 14 recommendation doesn't get to them -- I know they can't take 15 any action until they're in a formal meeting, but it will be 16 very helpful. People will be asking them. So it will be 17 very helpful, I think, if you go with the recommendation to 18 have it communicated to the individual members of the 19 Commission in the meantime and not wait until that -- that 20 meeting. 21 That's the way, I think, you'd have the most 22 effect. They may be back here for a 5th Called Session. 23 And by that time, they may have met and be able to do 24 something more formal. But I do think people look to y'all. 25 Just like last session, we went and -- we went and told 0085 1 members of the legislature that the Bingo Advisory Committee 2 had made a recommendation to the Commissioners. 3 And that counts. So I -- I think it does 4 matter. I would like to see the commissioners, though, 5 informed individually of your recommendation before that 6 next meeting. 7 CHAIR BRACKETT: Does that clarify? 8 MR. MANIO: Yes. And so what exactly are we 9 going to recommend? 10 MR. MOORE: That we're in support of instant 11 bingo cardminders . 12 MS. TAYLOR: And progressive games. 13 MR. MANIO: Okay. Thank you. 14 CHAIR BRACKETT: And Danny, do you have 15 anything else on this Item No. 8? 16 MR. MOORE: No. I think we covered most of 17 it or they did. 18 CHAIR BRACKETT: Okay. Everyone who's in 19 favor of the motion, please say aye. 20 MR. MOORE: Aye. 21 MR. WHITTINGTON: Aye. 22 CHAIR BRACKETT: Aye. 23 MS. TAYLOR: Aye. 24 MS. GREENFIELD: Aye. 25 MR. MANIO: Aye. 0086 1 MR. PAVLOVSKY: Aye. 2 MR. DOUGHERTY: Aye. 3 CHAIR BRACKETT: Okay. That's an 4 enthusiastic aye. That carries. 5 MS. MORRIS: No opposed? No opposing? 6 CHAIR BRACKETT: Anyone opposed? Thank you. 7 I was reading lips. I'm sorry. 8 All right. It's straight up 12. Do we want 9 to take a lunch break now? 10 MR. WHITTINGTON: It's been two hours. 11 CHAIR BRACKETT: What did you say? 12 MR. WHITTINGTON: It's been two hours. He... 13 CHAIR BRACKETT: Oh, I'm sorry. I am sorry, 14 yeah. I thought about you about an hour ago. The court 15 reporter needs a break, so let's just take our lunch break 16 now. And can we reconvene in -- should we say 45 minutes or 17 one o'clock? Let's say one o'clock. Thank you. 18 (Recess from 12:05 p.m. to 1:10 p.m.) 19 CHAIR BRACKETT: All right. Everyone has 20 returned, all of the members of the Bingo Advisory 21 Committee, including the chairman, who was late. And we 22 will reconvene and call back to order. 23 AGENDA ITEM NO. 5 24 CHAIR BRACKETT: We are at Agenda Item No. 5, 25 consideration of and possible discussion and/or action on 0087 1 the organization of the bingo administrative rules. 2 And before you start, I would like to 3 acknowledge that Chairman Clowe is here this afternoon. 4 It's always nice to have you here. And I hope you will not 5 hesitate to step forward whenever -- whenever you feel the 6 calling to step forward. 7 CHAIRMAN CLOWE: Thank you. 8 CHAIR BRACKETT: Thank you. 9 MR. ATKINS: Members, I don't think that a 10 lot of you have had a chance to meet Sandy Joseph. She's 11 assistant general counsel with the agency. Sandy's been 12 with us four months, maybe. 13 MS. JOSEPH: Two. 14 MR. ATKINS: Two months? It seems so much 15 longer. 16 MR. PAVLOVSKY: You really know what's going 17 on, don't you? 18 MR. ATKINS: Yeah. Well, you know when 19 you're dealing with lawyers how it just seems to draw out. 20 Sandy comes to the agency and brings with her 21 some extensive experience in the area of administrative law. 22 She has been employed both with the Comptroller's office, as 23 well as the Railroad Commission. 24 Also, Sandy has a lot of experience and 25 training in the area of mediation and she has worked with 0088 1 other advisory committees in the past, particularly when she 2 was at the Railroad Committee. 3 I just offer this by way of introduction. 4 And part of what Sandy wants to share with you today is some 5 ideas that we have planned regarding our current rule 6 structure and some planned upcoming rulemaking. 7 MS. JOSEPH: Thank you, Billy. I'm happy to 8 be here with y'all. I look forward to working with you and 9 getting to know you. Can you hear me okay? Is this 10 working? No. Okay. Is that better? 11 CHAIR BRACKETT: That's better. 12 MS. JOSEPH: All right. Thanks. All right. 13 I have the next three items. The first is Item No. 5. I've 14 handed you a copy of an index -- of the index to the bingo 15 rules. The purpose of Item 5 is to let you know that the 16 staff is beginning to work on a rule amendment to reorganize 17 the rules to make it easier for licensees and the general 18 public to find rules on a particular subject. 19 Right now, as you can see from the index that 20 I've handed you, they're just simply listed one after the 21 other and they're not grouped in any way. You pretty much 22 just have to hunt through them. 23 Since we are adding rules, staff thought it 24 might be appropriate to try to organize them in a way that 25 made sense. They might do something like put them into 0089 1 subchapters. Maybe one subchapter would be general 2 provisions. Another might be licensing requirements, four 3 or five, maybe, subchapters to group them. 4 I did want to let you know that we are 5 working on this. In order to do it, what we'll have to do 6 is actually propose repeal of all the rules at the same time 7 that we propose amendments to the rules, because this is 8 going to involve some renumbering when we organize them. 9 Also, at the same time as we're doing this, 10 we want to take the opportunity to update the legal 11 citations that might have changed through the changes in the 12 law or changes in other rules. So we're not planning on any 13 substance changes, just purely organizational. 14 We want to propose this or be ready to do it 15 at a time when there are no other rules currently formally 16 proposed, if at all possible, to eliminate confusion. So we 17 want to get ready with this and watch for an opportunity, a 18 window when we can put them out there and just make it, you 19 know, real straightforward and simple, hopefully. 20 You may wish to designate a subcommittee to 21 work on this. We haven't got the draft ready yet. But 22 since y'all won't probably be meeting for a few months, we 23 wanted to go ahead and let you know that this is going on 24 and if you want to appoint a subcommittee or some persons in 25 advance maybe to work with the staff on this. And I don't 0090 1 think there will be a lot of work involved -- but to get the 2 comments of the group, then you might want to consider doing 3 that. 4 Otherwise, this is for your information. 5 CHAIR BRACKETT: Okay. Do I hear any 6 volunteers to work with her on this? It certainly sounds 7 like it will make it easier to find what you're needing to 8 find. So Mario -- Mario will be a real good one to work 9 with you. 10 MR. PAVLOVSKY: I will. 11 CHAIR BRACKETT: And Pete will work, too. 12 MS. JOSEPH: Okay. Mario and Pete, thank 13 you. 14 AGENDA ITEM NO. 6 15 MS. JOSEPH: Item No. 6, the purpose of this 16 item is to advise you that the staff is also working on a 17 proposed new rule to address administrative penalties for 18 violations of the Act. 19 The rule would provide licensees with 20 specific information about the anticipated penalty for a 21 specific violation. This rule is still in the drafting 22 process for the staff, but we anticipate that we will have 23 something ready for y'all or your subcommittee to work on 24 before the next time you meet. 25 So again, we didn't want to wait until the 0091 1 next meeting of the BAC to let you know about this, but 2 thought that you might wish to go ahead and find some 3 volunteers or appoint a subcommittee to look this over when 4 we do have it in the kind of shape when we want to present 5 to the subcommittee for the first time. 6 CHAIR BRACKETT: So you're asking for some 7 people that will preview it before it's submitted to the 8 Bingo Advisory Committee? 9 MS. JOSEPH: Yes. 10 CHAIR BRACKETT: Do we have any volunteers 11 for that? 12 MR. ATKINS: Now I will let the volunteers 13 know this will be -- we anticipate a very big undertaking 14 and will require some fairly extensive or -- no, some fairly 15 extensive time requirements to go through this process. 16 CHAIR BRACKETT: You're supposed to say that 17 after the people have been appointed. 18 MR. ATKINS: Well, I just -- you know, I 19 thought I'd be up front. 20 CHAIR BRACKETT: Honest Abe over here. 21 MS. JOSEPH: There will be a lot of substance 22 to this. 23 CHAIR BRACKETT: All right. So -- but it 24 will be interesting and you'll gain new knowledge, correct? 25 MS. JOSEPH: Oh, yes. 0092 1 CHAIR BRACKETT: So there are a lot of 2 advantages to being a part of it. So Suzanne, would you 3 like to be part of that? 4 MS. TAYLOR: Okay. 5 CHAIR BRACKETT: Mario, you would be good on 6 that, too. 7 MR. MANIO: I would? 8 CHAIR BRACKETT: Yes. 9 MR. MANIO: Okay. 10 CHAIR BRACKETT: And Danny, would you like to 11 be the industry representative? 12 MR. MOORE: Sure. 13 CHAIR BRACKETT: Okay. So Mario and Suzanne 14 and Danny will be serving on that. 15 MS. JOSEPH: All right. Then we'll be in 16 touch with those members when we have something for them to 17 start helping us with. 18 AGENDA ITEM NO. 7 19 MS. JOSEPH: Item No. 7 is also a rulemaking 20 item. And it relates to Rule 580, bingo reports. HB 2519 21 changed the due date of quarterly reports from the 15th to 22 the 25th of the month. And staff is also drafting a 23 proposed amendment to this rule to make the rule conform 24 with the statute. 25 The statute now indicates 25 days. Our rule 0093 1 still indicates 15 days. Your notebook item, the memo there 2 under Item 7, shows the proposed changes. And you'll see 3 that the change would be in three places in the rule. There 4 in paragraph A would change from 15 to 25. In paragraph 5 C -- excuse me -- not paragraph, subsection C-1 change from 6 15 to 25. And also in subsection D-1 would simply change 7 the days from the 15th to the 25th day of the month. 8 There would be no other changes to proposed 9 rule. This is simply to make the rule conform to the 10 statute. Did everybody find that? Any questions about what 11 I've described? 12 All right. Because this is a very -- 13 MR. DOUGHERTY: Well, could I clarify the 14 nomenclature in here? 15 MS. JOSEPH: Certainly. 16 MR. DOUGHERTY: Where my book says 425 and 17 all that stuff, 125, what is that supposed to be? 18 MS. JOSEPH: Okay. Like under paragraph A -- 19 MR. DOUGHERTY: I know it's a typo, but... 20 MS. JOSEPH: No. What -- what the staff did 21 there was to indicate that the one was going to be deleted 22 and a two inserted. It's changing that from the 15th to the 23 25th. 24 MR. DOUGHERTY: Oh, okay. That's what that 25 is, okay. 0094 1 MS. TAYLOR: But in C-1, they didn't do the 2 strike-through on the one. 3 MS. JOSEPH: Oh, Okay. I see. 4 MR. DOUGHERTY: So it is the 25th? 5 MS. JOSEPH: Uh-huh. 6 MR. DOUGHERTY: All right. 7 MS. JOSEPH: Yes, it should be the same for 8 all of those. 9 MR. DOUGHERTY: Oh, okay. I'm clear. 10 MS. JOSEPH: I apologize for that omission. 11 Any other questions? 12 CHAIR BRACKETT: I want to make a comment on 13 this. I have had two different bookkeepers from two 14 different halls call me and say what a wonderful reprieve 15 this is, how important those days are to them. A lot of 16 them had difficulties having all the bank statements they 17 needed and enough time to get them and so forth. 18 They're very, very pleased with this change. 19 MS. JOSEPH: Good. Well, because this is 20 really a very simple proposed amendment, I'm thinking that 21 you may wish to go ahead, as a group, and indicate your 22 support for that amendment today. I don't believe it would 23 require any subcommittee work. 24 It's very simple and straightforward. And 25 that would be my suggestion to you. 0095 1 CHAIR BRACKETT: So you want just to record a 2 show of support from the -- from the Bingo Advisory 3 Committee? 4 MS. JOSEPH: Yes, to indicate to the 5 Commission that you support this proposed amendment. 6 CHAIR BRACKETT: Okay. The proposed 7 amendment is TAC 40.50; is that correct? 8 MS. JOSEPH: Yes. 9 CHAIR BRACKETT: And would anyone like to -- 10 MS. TAYLOR: I make that motion. 11 CHAIR BRACKETT: Okay. 12 MR. MANIO: I second the motion. 13 CHAIR BRACKETT: All right. So that we are 14 indicating our support to this change. 15 MS. JOSEPH: All right. Thank you. That's 16 all I have. 17 AGENDA ITEM NO. 9 18 CHAIR BRACKETT: We have already covered Item 19 No. 8 on the agenda. So that puts us at Item No. 9, which 20 is the report and possible discussion by the Bingo Advisory 21 Committee work group on the review of the Operator Training 22 Program. 23 And Suzanne Taylor -- the minutes indicated 24 that Suzanne Taylor is serving on this committee. And my 25 name is on there, too. And so Suzanne has the report for us 0096 1 today. 2 MS. TAYLOR: Our report will be there is no 3 report at this time. 4 AGENDA ITEM NO. 10 5 CHAIR BRACKETT: So we quickly move on to 6 Item No. 10, which is report and possible discussion by the 7 Bingo Advisory Committee work group on the review of the 8 bingo forms and applications. And Patricia Greenfield and 9 Mario worked on this. 10 MS. GREENFIELD: We've done preliminary work 11 on it. I talked to Terry Shankle last week and she asked 12 that we start looking at quarterly reports to revise. And 13 then Mario and I met on April 23rd and we discussed ideas 14 for revising the quarterly unit accounting. 15 On April the 27th, Mario and Terry and I met 16 and we discussed designing new quarterly reports for 17 non-annual temporary bingo units and conductor/lessors. And 18 we touched briefly on changing the forms on the Web site to 19 a computer writable format. 20 And we plan on meeting again probably the 21 third week of May. 22 CHAIR BRACKETT: Okay. How much out of order 23 would I be if I went back to Item No. 9 and did make some -- 24 a few -- couple of comments on that? It's no action or 25 anything. Is that okay with everyone if I do that? 0097 1 AGENDA ITEM NO. 9 2 CHAIR BRACKETT: I did want to say that the 3 operator training seems to be more fun and better than it 4 used to be. And I think that if they are looking at it as 5 something that could be a video production, it would be 6 really good if it would be something that you -- that bingo 7 licensees could check out, maybe, and use in their hall and 8 send back, kind of like you do something from the library. 9 Now I found it really good to be working with 10 lots of other operators from lots of other bingo halls, 11 simply because of a chance just to be together and see each 12 other. But I do understand that there is an interest in 13 making this a video production strictly, rather than having 14 the auditors from the region there doing it. 15 But I think it would travel well if it could. 16 And that's really about the only comment that I have to make 17 on it. 18 MS. TAYLOR: Okay. Then I'll make one 19 comment, too. I did go to an operator training just so I 20 could see what's happening at a current operator's training. 21 And I went to the one that was held last month, I guess, in 22 San Antonio so that I could check it out. 23 There's no report, but if I was to make a 24 written report, it would be: It's totally changed from the 25 first operator's training I went to. The first one I went 0098 1 to, the person that was giving the training read from a 2 piece of paper. And I felt like I was being read to the 3 entire time. 4 And this one was very interactive and it was 5 interesting. You know, I don't think that I learned 6 anything really new that we haven't heard before, but it was 7 very interesting and informative. And it's changed a whole 8 lot since the first one that I ever went to. 9 CHAIR BRACKETT: That was my experience, too, 10 so -- and it was fun, really it was. 11 AGENDA ITEM NO. 11 12 CHAIR BRACKETT: All right. We're going down 13 to Item No. 11 -- or are we at 10, the bingo forms? 14 MR. ATKINS: 11. 15 CHAIR BRACKETT: 11, okay. Mario, according 16 to page 53 of the minutes, you were on this committee rather 17 than me. 18 MR. MANIO: Let me make a correction to that. 19 It's chaired by Patricia. 20 CHAIR BRACKETT: Okay. 21 MR. MANIO: And I'm a member of that. 22 CHAIR BRACKETT: And you're a member, okay. 23 That's wonderful. So this is on review of the operations 24 manual. 25 MS. GREENFIELD: Marshall McDade was the 0099 1 staff representative on this. And he and I have spoken to 2 each other, I think, twice. So we haven't really done 3 any -- any work yet. So there's really no report to give at 4 this time. 5 CHAIR BRACKETT: Well, your report is that 6 you are working on it and you have visited? 7 MS. GREENFIELD: Yes. 8 AGENDA ITEM NO. 12 9 CHAIR BRACKETT: And then also Item No. 12 is 10 yours, Patricia, report and possible discussion on action by 11 the nominating committee to submit recommendations for new 12 members of the Bingo Advisory Committee. 13 MS. GREENFIELD: Yes. I wanted to thank the 14 persons who submitted their names for the position: James 15 Benke, Kimberly Rogers, and Denver Blanscett. 16 We need people from the industry to get 17 involved. And I certainly appreciate them stepping forward 18 to do that. And I also wanted to thank Pete and Danny for 19 their hard work and contributions they made to the 20 subcommittee. We were tasked with conducting preliminary 21 interviews with the nominees. 22 And our reports are included in your -- in 23 your notebook. And I've also given Chairwoman Brackett and 24 Director Atkins a report, plus I've given Director Atkins 25 three additional reports for the Commissioners. And those 0100 1 reports contain completed nominee question -- questionnaires 2 that have the comments from the interviewers and also the 3 answers to the questions from the -- from the nominees. 4 And those were to be used in their 5 interviews. And it was my understanding that we conducted 6 the initial interviews and then we were supposed to provide 7 a report that you and the commissioners would use to do your 8 interviews with. 9 When we -- we looked at providing a 10 recommendation for a nominee that was not already 11 represented by a current committee member in regards to 12 geographic location, for a nominee to have a good 13 understanding of how a bingo operation works, and a nominee 14 with a strong desire to serve on the committee. 15 We thought it was important to have a 16 standardized list of questions to ask each nominee. So the 17 committee compiled a list of questions and created a 18 document called the BAC Nominee Interview Questionnaire. 19 And we used that questionnaire in all the interviews. 20 Each member was assigned a nominee to 21 interview. And then their answers were put in that -- in 22 that document. We then met by conference call and discussed 23 the nominees and came up with our recommendation. 24 CHAIR BRACKETT: Okay. You want to tell us 25 who the recommendation is? 0101 1 MS. GREENFIELD: We recommend that Denver 2 Blanscett fill the conductor/lessor position on the Bingo 3 Advisory Committee. 4 CHAIR BRACKETT: Do you want to give any 5 supporting information on that or -- 6 MS. GREENFIELD: Well, we believe he has a 7 strong desire to serve on the committee, he's got good 8 leadership abilities, and he's got a firm grasp of how bingo 9 operation works. We think he'd be a great asset to the 10 committee. 11 CHAIR BRACKETT: Okay. Anyone have any 12 questions or further comments? Now this would be our 13 recommendation that goes to the commissioners for their -- 14 for their pleasure. 15 MR. ATKINS: And again, as a reminder of what 16 we've done in the past is, based upon the recommendation of 17 the Advisory Committee, the designated representative from 18 the Lottery Commission, which is the Bingo representative of 19 the Lottery Commission, which is -- in this case is Chairman 20 Clowe has met with that individual, along with myself and 21 the chair of the Advisory Committee to discuss some of the 22 expectations, etcetera. 23 And assuming we wanted to follow that 24 pattern, either with Chairman Clowe -- I think there has 25 also been some discussion, maybe Commissioner Cox may take 0102 1 part in that process in your place, just depending on 2 scheduling or whatever. 3 We would -- we would then follow up on that 4 and schedule a meeting and then take that to the Commission 5 at a subsequent meeting. 6 I just say, from our perspective, I think 7 that the questionnaire that y'all put together will be very 8 helpful to the commissioners as they -- as they go through 9 the process. I'm a little concerned this is something that 10 we've been working on for some time. 11 In flipping through what some of their goals 12 would be, it seems pretty consistently that their goals are 13 to use the Advisory Committee as a means to make charitable 14 either more prosperous or more successful or things like 15 that. And I'd refer the members back to the Sunset staff 16 report, particularly on page 25, and again, what the purpose 17 of the Advisory Committee is and what it is not. 18 And again, that's one of the things that 19 we'll be working on with the Advisory Committee in the 20 future is helping them better focus on the information that 21 they put together and provide to the -- to the 22 commissioners. 23 MS. GREENFIELD: Can I make a comment? 24 MR. ATKINS: Sure. 25 MS. GREENFIELD: I agree with you. Of 0103 1 course, we put down what the nominees said. And you had 2 sent me that Powerpoint presentation that you gave at the 3 February meeting. And I was going -- I'm still working on 4 it. I was going to give you recommendations on some things. 5 MR. ATKINS: Okay. 6 MS. GREENFIELD: I thought it was excellent. 7 It was excellent. But I think something that would help the 8 committee is, you know, when the new members come on, 9 they're given -- you know, we can give them some more 10 guidance as to what their job is and what our role is and 11 how -- you know, so I think if we can implement that with 12 the new members that come on board, you know, the issue that 13 you brought up would be helped. 14 MR. ATKINS: Uh-huh. 15 CHAIR BRACKETT: Any other comments or anyone 16 have any questions? I did talk to Mr. Blanscett by phone. 17 And I agree with your evaluation. He is very interested and 18 informed. And I think he'll be -- will attend the meetings 19 loyally and participate appropriately. Any other comments 20 on this item of business? 21 MR. DOUGHERTY: Where is Mr. Blanscett from? 22 CHAIR BRACKETT: He's from Lubbock. And he's 23 with a VFW Hall 575. And they are a very active group in 24 the community and do a lot of good things for the community. 25 Their most recent thing -- which they've been 0104 1 very open about this bingo money, which has been wonderful 2 publicity for all of us. They built a fantastic war 3 memorial that is very, very, very pretty and the community 4 has gotten very enthusiastic about it. 5 So that's made the community more aware of 6 what profits from bingo can do. Are you familiar with this 7 at all? 8 MR. PAVLOVSKY: Me? 9 CHAIR BRACKETT: Pete. 10 MR. PAVLOVSKY: Only what he told me. 11 CHAIR BRACKETT: Only what he told you? 12 MR. PAVLOVSKY: Yeah. Yeah. And I was very 13 impressed. 14 CHAIR BRACKETT: It's an impressive site, it 15 really is. 16 MR. PAVLOVSKY: I bet it is. 17 CHAIR BRACKETT: And they -- they dedicated 18 it on Pearl Harbor Day, so it's very -- but it covers all 19 the wars. There's a lot of Vietnam people honored there, 20 too. But that's just an aside. They've done a lot of good 21 things with their money. 22 All right. Any further comments or anything? 23 MR. PAVLOVSKY: Actually, I have a question 24 about the things that have been done and the committees that 25 have just been set up. Do we need to go back and modify the 0105 1 work plan and insert these things into that? 2 CHAIR BRACKETT: Uh-huh. 3 MR. PAVLOVSKY: I mean, even -- Patricia did 4 a tremendous job of putting that evaluation together for 5 new -- her questionnaire for new members. That's the kind 6 of stuff that should be also inserted in there, should it 7 not? 8 CHAIR BRACKETT: Correct. It should be in 9 the work plan. We don't have a work plan on the agenda for 10 this session. 11 MR. PAVLOVSKY: I understand. Maybe we'll 12 put it on next time. 13 CHAIR BRACKETT: Yes. It definitely needs to 14 be on next time. 15 MR. PAVLOVSKY: And maybe that's something 16 that needs to be on every one of them, on every agenda. 17 Anything that the committee has done that you can't see six 18 or eight or 10 months or a year from now, those things need 19 to be in there. Chairman Clowe is here. You know, he can 20 read. I mean, we don't -- I don't know why -- 21 CHAIR BRACKETT: He can also read between the 22 lines, so be careful what you say. 23 MR. PAVLOVSKY: What am I saying? Just 24 kidding, Chairman. But apparently, that's what the Sunset 25 Commission wanted was all of this data and, you know, even 0106 1 the little things that's given to them. That's going to 2 keep them happy. Thank you. 3 AGENDA ITEM NO. 13 4 CHAIR BRACKETT: Okay. Patricia, we'll 5 continue with you on report and possible discussion and/or 6 action to select a new chair for the Bingo Advisory 7 Committee. 8 MS. MORRIS: Excuse me. Did y'all have a 9 vote on that one individual? 10 CHAIR BRACKETT: We approved the nomination. 11 MS. MORRIS: Did y'all -- 12 CHAIR BRACKETT: Didn't we have a vote? 13 MR. PAVLOVSKY: No, ma'am. 14 CHAIR BRACKETT: We did not accept the 15 report? Okay. Then we need to have a -- Patricia, do you 16 want to make the motion that we accept the nomination? 17 MS. GREENFIELD: I make the motion that we 18 accept the nomination. 19 MR. PAVLOVSKY: Second. 20 CHAIR BRACKETT: All those in favor of 21 accepting Denver Blanscett's name for a member of the Bingo 22 Advisory Committee to be suggested to the Texas Lottery 23 Commission, please say aye. 24 MR. MOORE: Aye. 25 MR. WHITTINGTON: Aye. 0107 1 CHAIR BRACKETT: Aye. 2 MS. TAYLOR: Aye. 3 MS. GREENFIELD: Aye. 4 MR. MANIO: Aye. 5 MR. PAVLOVSKY: Aye. 6 MR. DOUGHERTY: Aye. 7 CHAIR BRACKETT: No opposition? Thank you. 8 Okay. Now we can take up No. 12. Patricia, 9 this is also you. 10 MS. MORRIS: Item No. 13. 11 CHAIR BRACKETT: 13, I'm sorry. I was 12 reading -- looking at 13, but saying 12. Report and 13 possible discussion and/or action to select a new chair for 14 the BAC. 15 MS. GREENFIELD: We don't have the 16 subcommittee nominating meeting -- we don't have a 17 recommendation at this time. If we could wait until the 18 next BAC meeting to present someone for the position or I'm 19 not sure how you want to handle it, Madam Chair. 20 CHAIR BRACKETT: Can this same committee 21 handle it for the next meeting? 22 MS. GREENFIELD: Yes, I think so. 23 CHAIR BRACKETT: So we'll hear a report from 24 you the next meeting. And then in the meantime, in my 25 absence, the vice-chair could serve as the -- could preside. 0108 1 All right. Is that agreeable? Does that 2 work out for you? 3 MR. ATKINS: I'll say yes. The agency's 4 attorney is sitting back there with a somewhat confused look 5 on her face. If she could come up and address it on the 6 record. 7 MS. MORRIS: Yes, thank you so much. You 8 know, I'm here for the open meetings issues. And I 9 understand the subcommittees meet by telephone conference. 10 That's fine. The pattern has been that this board does not 11 rubber stamp decisions. 12 The day you start rubber stamping decisions 13 means those subcommittees have to have posted open meetings. 14 So with that backdrop, it could have even been that a quorum 15 of you, if you will, were meeting with the three people that 16 wanted to meet. 17 But all of a sudden now that you have a 18 committee -- and I'm not sure how many are on your 19 committee. But to the extent you reach out maybe to another 20 member of this same committee, I want you to make sure 21 you're not sitting on a quorum. Because for those purposes 22 alone, you'd be violating the terms of the Open Meeting Act, 23 which by rule this body is to follow. 24 MR. ATKINS: Okay. I don't think it's 25 their -- I don't think it's their intent to do that. 0109 1 MS. MORRIS: Yeah. The only other thing I 2 would say is: I really don't have at my fingertips what was 3 the charge, the scope of your nominating committee. If it's 4 for new members to the committee, that's obvious. But this 5 chair position, I don't know if that was within the scope of 6 the nominating committee. 7 MS. GREENFIELD: I believe a slate of 8 officers was charged to us at the last -- that's what I went 9 back and read in the minutes. 10 MS. MORRIS: And I'm going to rely upon y'all 11 to know more of what it was your scope was. Thank you. 12 MS. GREENFIELD: Thank you. 13 CHAIR BRACKETT: So it would be a slate of 14 officers would be your charge, correct? 15 MS. GREENFIELD: And I'm assuming that's the 16 chair. 17 MR. ATKINS: It is. And I think that needs 18 some clarification because, according to Charitable Bingo 19 Administrative Rule 567, which I believe is the BAC, the 20 members select from among themselves the chair. And then 21 the chair designates someone to act in his or her absence. 22 So what the committee would be selecting is a 23 recommendation for the chair. 24 CHAIR BRACKETT: Is everyone clear on this, 25 what's going to be happening? Okay. 0110 1 AGENDA ITEM NO. 14 2 CHAIR BRACKETT: Is there any public comment? 3 Did we hear -- did we hear all our public comment this 4 morning? I'd really like for you to come forward if there 5 is any. 6 Come on, Sharon. You're jumping around in 7 your seat. Come on. 8 MS. IVES: I don't -- I don't have anything 9 to say right now. 10 CHAIR BRACKETT: This might be your last 11 chance. 12 Well, thank you. We appreciate you being 13 here. We really do. I want to say your loyal attendance, 14 we appreciate your loyal attendance and your good ideas, 15 too. You've thought them through. 16 AGENDA ITEM NO. 15 17 CHAIR BRACKETT: Okay. Item No. 15 is 18 consideration and possible action on future Bingo Advisory 19 Committee meetings and/or items to be recommended to the 20 Commission for consideration at future Bingo Advisory 21 Committee meetings. 22 There were several things that came up as we 23 went through the agenda today; is that correct? 24 Billy, were you making notes on things that 25 we need for the next agenda? 0111 1 MR. ATKINS: No, ma'am. 2 MS. GREENFIELD: Would the subcommittees that 3 you appointed today possibly report next time? 4 CHAIR BRACKETT: Uh-huh. We'll be needing 5 some reports on what's -- what's happening. Of course, that 6 always goes along with the -- on the legislative agenda -- 7 well, and what's happening in the legislative session, the 8 multi-hall video, the multi-premises bingo, yeah, definitely 9 the work plan. 10 You need to come prepared to submit items for 11 the work plan, which I think we already have a pretty 12 good -- everyone has different things in their minds on 13 that, a pretty good idea. The Operator Training Program, I 14 think we took care of that and the bingo forms -- I'm trying 15 to look for things that might be continuing. 16 MR. ATKINS: I'm not -- you think that the 17 work group has issued their final report on the Operator 18 Training Program? 19 CHAIR BRACKETT: Suzanne, what do you think? 20 MS. TAYLOR: No, we can put a -- we can put a 21 report together for the next meeting. 22 MR. MOORE: And I'm sure No. 6, which 23 Suzanne -- we will probably be meeting on that between now 24 and our next meeting, the administrative penalty rules. 25 There should be something started by then. It sounds like 0112 1 it's going to take a few months to get this going. 2 MS. TAYLOR: And another thing we might want 3 to put in it is give each of the members a copy of the 4 Sunset -- what the BAC has said about the Sunset report that 5 we're going to put together to give to the Lottery 6 Commission tomorrow so that everybody knows what we've 7 handed over. 8 MR. WHITTINGTON: Yeah. 9 CHAIR BRACKETT: And then -- were you getting 10 ready to say something, Patricia? 11 MS. GREENFIELD: I was just going to say we 12 probably will have a report on the bingo forms again on that 13 and the progress on that. 14 CHAIR BRACKETT: And Mario, you'll have some 15 reports? 16 MR. MANIO: Yes. 17 CHAIR BRACKETT: Okay. So -- and stay -- as 18 ideas hit you, be sure you put them somewhere where you can 19 remember them, whether at the back of your brain or a piece 20 of paper and get them submitted for -- if they need to be 21 agenda items and submitted for consideration of that. 22 Of course, right now I can't tell you what 23 the deadline is since we have not set a meeting date for the 24 next meeting. 25 So let's discuss that, Item 15. When would 0113 1 be our next time that you want to meet? 2 MR. DOUGHERTY: Madam Chairman, speaking for 3 myself, I cannot meet in June. 4 CHAIR BRACKETT: Okay. 5 MR. DOUGHERTY: In our usual progression, two 6 months, that's the reason I said that. 7 CHAIR BRACKETT: Okay. Is the end of -- this 8 is April. Is July too far away to meet or is July a good 9 time to meet? Is May too soon? 10 MS. GREENFIELD: Well, the session would be 11 over when, the legislative session, in June? 12 MR. ATKINS: Yeah. I mean, this -- this 13 current 30-day session will end in May, about the middle of 14 May. But, you know, there's no way of knowing if another 15 one will be called right after that, whether they'll still 16 be in session or not. 17 I think there's probably, I think, about two 18 weeks left to this current special session. So I don't know 19 if one will be called after that or not. 20 CHAIR BRACKETT: July really might be a good 21 time to meet. It will be very, very hot in Austin, Texas in 22 July, but -- well, y'all look at your calendars and see what 23 -- how close to July 4th or how far away from it you want to 24 meet. 25 MR. PAVLOVSKY: July 8th? 0114 1 CHAIR BRACKETT: Okay. That's the second 2 Thursday of July. Is July 8th a good time? The second week 3 of the month is a good time for you? If y'all don't say, 4 I'm going to arbitrarily set it. And if you're not here, 5 you're going to be fined. 6 MR. MOORE: 8th is fine with me. 7 CHAIR BRACKETT: Okay. July 8th, that's a -- 8 MS. TAYLOR: Is there -- 9 CHAIR BRACKETT: Well, that's -- 10 MS. TAYLOR: -- a reason why we meet on 11 Thursdays? Is there any other way that we could meet a 12 different day than Thursday? I would love not to meet on a 13 Thursday. 14 MR. WHITTINGTON: Which day would you rather 15 meet on? 16 MS. TAYLOR: Monday, Tuesday, Wednesday or 17 Friday. 18 MR. WHITTINGTON: What about Saturday or 19 Sunday? 20 MS. TAYLOR: Saturday would be fine, too. 21 MR. MOORE: At the lake. 22 MS. TAYLOR: Thursdays are really tough for 23 me so -- 24 MR. WHITTINGTON: Oh, now we understand. 25 MS. TAYLOR: Because I have to be back into 0115 1 town every Thursday night and don't get home until midnight. 2 MS. GREENFIELD: What about Tuesday? 3 MS. TAYLOR: Tuesday would be great, 4 Wednesday or Monday or Friday. 5 CHAIR BRACKETT: I bet you don't want to 6 meet, though, on Tuesday the 6th. It's so close to July 7 4th. I bet you'd not be -- 8 MR. ATKINS: Well, and Tuesdays would be hard 9 for the staff because we have a series of standing meetings. 10 MS. TAYLOR: Are Wednesdays better? 11 MR. WHITTINGTON: Wednesday would be rough 12 for me and Danny. We got two people against one. 13 MR. DOUGHERTY: I'll go for Wednesday. 14 CHAIR BRACKETT: Wednesday the 14th? 15 MR. DOUGHERTY: Any Wednesday. 16 CHAIR BRACKETT: Any Wednesday? I'd suggest 17 you really stay away from that week of July 4th. 18 MR. MOORE: Yeah. Wednesday the 14th. 19 MR. WHITTINGTON: If y'all meet on the 8th, 20 y'all would all have to bring me birthday presents. That's 21 my birthday on the 7th. 22 MS. TAYLOR: Well, yesterday was my birthday, 23 too. Where's my gift? 24 MR. WHITTINGTON: Well, happy birthday to 25 you. 0116 1 CHAIR BRACKETT: Don't get him singing. 2 MR. PAVLOVSKY: Virginia, did you say the 3 14th of July? 4 CHAIR BRACKETT: Yes. I think that's the 5 most recent suggested date is -- 6 MR. WHITTINGTON: 14th. 7 CHAIR BRACKETT: -- July -- Wednesday, July 8 the 14th. 9 MR. WHITTINGTON: Yeah. 10 CHAIR BRACKETT: Okay. Wednesday, July the 11 14th has been agreed upon as the next meeting date. 12 And by that time, I will be out of the bingo 13 business. So therefore, I'll no longer be an operator. In 14 fact, I'll be unemployed at that point in time. 15 But I really have -- I have learned a lot 16 just from coming down here and being here. And it's 17 really -- I'm really very, very glad that I have served on 18 the Bingo Advisory Committee. And I've gotten to serve with 19 good committees. 20 And I would be happy to recommend it for -- 21 any time y'all are looking for a replacement, I'll be happy 22 to call and talk to them and tell them that, yeah, you put 23 up with a lot of stuff. But in the end, it is worth it. 24 And you do get to see the whole picture. 25 And I think that's the most important thing. 0117 1 You don't just see your little hall and your little 2 troubles. You see the whole industry. 3 And I want to thank you for the opportunity 4 for having worked with you and getting to know you. 5 MR. PAVLOVSKY: Thank you for being chair for 6 all these years. 7 (Applause) 8 CHAIR BRACKETT: I really don't think it's 9 been all these years. 10 MR. PAVLOVSKY: All these years. 11 AGENDA ITEM NO. 16 12 CHAIR BRACKETT: All right. And we're 13 adjourned. 14 (Meeting adjourned at 1:50 p.m.) 15 16 17 18 19 20 21 22 23 24 25 0118 1 CHANGES 2 PAGE LINE CHANGE REASON 3 ____________________________________________________________ 4 ____________________________________________________________ 5 ____________________________________________________________ 6 ____________________________________________________________ 7 ____________________________________________________________ 8 ____________________________________________________________ 9 ____________________________________________________________ 10 ____________________________________________________________ 11 ____________________________________________________________ 12 ____________________________________________________________ 13 ____________________________________________________________ 14 ____________________________________________________________ 15 ____________________________________________________________ 16 ____________________________________________________________ 17 ____________________________________________________________ 18 ____________________________________________________________ 19 ____________________________________________________________ 20 ____________________________________________________________ 21 ____________________________________________________________ 22 ____________________________________________________________ 23 ____________________________________________________________ 24 ____________________________________________________________ 25 ____________________________________________________________ 0119 1 REPORTER'S CERTIFICATION 2 3 STATE OF TEXAS ) 4 COUNTY OF TRAVIS ) 5 6 I, David Bateman, RPR, Certified Shorthand 7 Reporter for the State of Texas, do hereby certify that the 8 above-captioned matter came on for hearing before the BINGO 9 ADVISORY COMMITTEE as hereinbefore set out, that I did, in 10 shorthand, report said proceedings, and that the above and 11 foregoing typewritten pages contain a full, true, and 12 correct computer-aided transcription of my shorthand notes 13 taken on said occasion. 14 15 Witness my hand on this the 6th day of May, 2004. 16 17 18 _________________________________ David Bateman, RPR, CSR #7578 19 Expiration Date: 12-31-05 1801 North Lamar Boulevard 20 Mezzanine Level Austin, Texas 78701 21 (512) 474-4363 22 23 24 25 JOB NO. 040429DPB