0001 1 TRANSCRIPT OF PROCEEDINGS 2 BEFORE THE 3 TEXAS LOTTERY COMMISSION 4 AUSTIN, TEXAS 5 BINGO ADVISORY COMMITTEE MEETING 6 7 8 9 10 JANUARY 10, 2019 11 10:00 a.m. 12 AT 13 TEXAS LOTTERY COMMISSION 611 East 6th Street 14 Austin, Texas 78701 15 16 17 18 19 20 21 22 23 24 Proceedings reported by electronic sound recording; transcript prepared by Verbatim Reporting & Transcription 25 LLC. 0002 1 APPEARANCES 2 COMMITTEE MEMBERS: 3 William T. Smith III 4 Kimberly Rogers 5 Will Martin 6 Tommy Duncan 7 Jason Pohl 8 Melodye Green 9 Emile Bourgoyne 10 11 COMMISSION STAFF: 12 Michael P. Farrell, Director 13 Bob Biard, General Counsel 14 15 PUBLIC: 16 Steve Bresnen, Attorney 17 Ronnie Baker 18 Stephen Fenoglio 19 Glenn Goulet (ph) 20 Kris Keller 21 Richard Bunkley 22 Don Bishop 23 Angela Hale 24 25 0003 1 TABLE OF CONTENTS 2 PAGE II. Call to order . . . . . . . . . . . . . . . . . 4 3 II. Roll call . . . . . . . . . . . . . . . . . . . 4 4 III. Meeting minutes from 15 November 2018 - 5 Public Comment . . . . . . . . . . . . . . . . 5 6 IV. Report on TLC Commissioners meeting - Public comment . . . . . . . . . . . . . . . . . . . . 6 7 V. Discussion & possible action on procedural changes 8 for BAC meetings - Public comment . . . . . . . 6 9 VI. Discussion & possible action on rules for work group meetings and conference calls - Public 10 comment . . . . . . . . . . . . . . . . . . . . 11 11 VII. BAC recommendations for vacant seats - Public comment . . . . . . . . . . . . . . . . . . . 14 12 VIII. Keller Work group - Electronic Bingo suggestions - 13 Public comment . . . . . . . . . . . . . . . 30 14 IX. Discussion & possible action on electronic pull tab machines - Public comment . . . . . . . . . . 47 15 X. Discussion & possible action on pull tab rules - 16 Public comment . . . . . . . . . . . . . . . 64 17 XI. Discussion & possible action on illegal gambling, re: prize fees going to general fund HB03611 (2017 18 Lucio III/Keumpal) - Public comment . . . . . . 50 19 XII. Any old business - Public comment . . . . . . . 68 20 XIII. Any new business - Public comment . . . . . . . 68 21 XIV. Set date for next meeting . . . . . . . . . . . 69 22 XV. Adjournment . . . . . . . . . . . . . . . . . 73 23 24 25 0004 1 P R O C E E D I N G S 2 THURSDAY, JANUARY 10, 2019 3 (10:00 a.m.) 4 AGENDA ITEM I 5 CHAIRMAN SMITH: All right. It's 10:00 a.m. 6 -- it's working? All right. It's 10:00 a.m. This is the 7 January 10th meeting of the Bingo Advisory Committee to the 8 Texas Lottery Commission. 9 AGENDA ITEM II 10 CHAIRMAN SMITH: I'd like to call the meeting 11 to order and I'd like to have roll call. Kim? 12 MS. ROGERS: Here. 13 CHAIRMAN SMITH: Will? 14 MR. MARTIN: Here. 15 CHAIRMAN SMITH: Tommy? 16 MR. DUNCAN: Here. 17 CHAIRMAN SMITH: Jason? 18 MR. POHL: Here. 19 CHAIRMAN SMITH: Melodye? 20 MS. GREEN: Here. 21 CHAIRMAN SMITH: Emile? 22 MR. BOURGOYNE: Here. 23 CHAIRMAN SMITH: And our Executive Director of 24 the Bingo Division, Michael Farrell? 25 MR. FARRELL: I'm here. 0005 1 AGENDA ITEM III 2 CHAIRMAN SMITH: Excellent. All right. Let's 3 go to meeting minutes from the 15th of November. Kim, you 4 want to do that? You didn't -- oh, you have them on email? 5 MS. ROGERS: I didn't get the minutes. 6 CHAIRMAN SMITH: All right. Is there anybody 7 that would like to correct any meeting minutes from the last 8 meeting or add anything to them? 9 MR. MARTIN: I'd like to do the Pledge of 10 Allegiance, before we get to it. 11 CHAIRMAN SMITH: Yes, sir. All right. 12 (Pledges recited) 13 CHAIRMAN SMITH: All right. Thank you, sir. 14 Would anyone like to correct the minutes or add anything to 15 the minutes from the last meeting? Can we get a motion to 16 accept the minutes? 17 MR. BOURGOYNE: Were they ever posted on the 18 website? I saw the transcripts, I never saw the meeting 19 minutes. 20 MR. FARRELL: Well, I'll double-check on that. 21 MR. BOURGOYNE: Okay. 22 MS. ROGERS: I motion to accept them as they 23 are. 24 CHAIRMAN SMITH: Okay. 25 MR. (*): I'll second. 0006 1 CHAIRMAN SMITH: All right. We have a motion 2 and a second. All in favor? 3 (Chorus of "ayes") 4 CHAIRMAN SMITH: Any opposed? All right. 5 AGENDA ITEM IV 6 CHAIRMAN SMITH: Okay. Report on the Texas 7 Lottery Commissioners meeting. We had a good meeting, we 8 went over the points that we had from our November meeting. 9 The Commissioners were happy with our recommendations and 10 there's a very short presentation. Any comments on that? 11 Okay. 12 AGENDA ITEM V 13 CHAIRMAN SMITH: Item number five; discussion 14 and possible action on procedural changes for the BAC 15 meetings. We ran into, I think we're getting our sea legs, 16 if you will, on the way we do our meetings and the 17 proceedings that we use. I wanted to make a recommendation 18 that we introduce something in one meeting and then vote on 19 it in the following meeting, to give everybody a chance to do 20 their due diligence and do their research on an item. I 21 think that's the way most boards do it, at least on the 22 boards that I've been on in the past. If there's any 23 objections to that -- 24 MR. MARTIN: I was going to make a motion that 25 we adopt that procedure. 0007 1 CHAIRMAN SMITH: Okay. All right. 2 MS. ROGERS: I will second that motion. 3 CHAIRMAN SMITH: All right. We have a motion 4 and a second. All in favor? 5 (Chorus of "ayes") 6 CHAIRMAN SMITH: All right. Any opposed? 7 Motion carries. All right. The other thing I was going to 8 add to that was there are some times when time sensitive 9 things come up that we need to vote on in the same meeting, 10 something maybe for Michael or something on a legislative 11 agenda or something that we need to make a recommendation of. 12 If there's not a member here to be able to do that, in some 13 boards, you have to have a two-thirds majority to do that, to 14 make that carry in the same meeting. I'd like to hear you 15 all's thoughts on that. I think, Will, you had some concern 16 with that? 17 MR. MARTIN: Yeah. There is -- I mean, since 18 we're adopting a rule that says if there's something that 19 comes up that has to wait for the following meeting, then 20 we're just kind of just stepping back and shooting our own 21 self in the foot. I can't think of anything that would be an 22 emergency that you needed a two-thirds vote for, all the 23 committees that I serve on, it's majority rules, the Texas 24 Lottery Commission, the legislative people there, we all use 25 the majority rules. The only time I've seen a two-thirds 0008 1 vote be used is if, say we wanted to go back now and change 2 that rule we just adopted about bringing that up, we would 3 need a two-thirds vote to change that rule. 4 CHAIRMAN SMITH: Okay. I think -- 5 MR. MARTIN: That is -- that is basically 6 Robert's rules of order. 7 CHAIRMAN SMITH: Sure. I don't know that we 8 want to actually adopt to follow Robert's rules of order, 9 specifically, that gets really complicated and can bog us 10 down a lot; however, I do see what you're saying. I just 11 wanted to leave a -- an out, if you will, if something came 12 up that was very important that if Lottery Commission needed 13 it or we needed it for the legislature to make a 14 recommendation that we have an out to come back and say, 15 okay, look, our policy is introduce it at one meeting, vote 16 on it the next, and if we have something that's time 17 sensitive that we have to get out before the next meeting 18 that we have an avenue to get that out. That's my only -- 19 MR. MARTIN: Can I make a recommendation then? 20 CHAIRMAN SMITH: Sure. 21 MR. MARTIN: The issue is -- was the notice of 22 what the issue was that we were expected to vote on. So, if 23 we had a procedure with -- if you wanted to have a vote of 24 the meeting, if the agenda item was specifically laid out X 25 number of days in advance where we had an opportunity to get 0009 1 back to the people we represent and I wouldn't be opposing 2 something like that, to vote on it at that meeting, but it 3 would have to be at least, you know, at least a ten-day 4 notice of the exact agenda item. 5 CHAIRMAN SMITH: Okay. 6 MS. ROGERS: I would agree with that because 7 if -- when you send the agenda to us -- 8 CHAIRMAN SMITH: It's kind of generic -- 9 MS. ROGERS: -- you said we're voting on this 10 due to research, due to do diligence, if someone's not going 11 to be able to make the meeting, then maybe they could also 12 weigh in prior to the meeting and you could bring forth their 13 vote. 14 CHAIRMAN SMITH: Okay. 15 MS. ROGERS: If it needs to be voted -- if 16 Michael came to us and said, I have to have something at this 17 next meeting and you never know, we've had those come up. 18 CHAIRMAN SMITH: Sure. 19 MR. MARTIN: And nowadays, with cell phones, 20 email, and everything else -- 21 MS. ROGERS: Right. 22 CHAIRMAN SMITH: This came up because we -- on 23 the agenda was to approve somebody's legislative package 24 without specifics about what that package was but we didn't 25 find those specifics out until we got here at the meeting, 0010 1 that's why this issue came up. Had that package been part of 2 the agenda where we could see it -- 3 MS. ROGERS: We could have researched it 4 prior. 5 CHAIRMAN SMITH: Sure. 6 MR. MARTIN: What was -- what was the 7 timeframe you -- 8 MR. BOURGOYNE: Ten days. 9 MR. MARTIN: Ten days. 10 CHAIRMAN SMITH: At a minimum, yeah, I think 11 ten days would do it. 12 MR. BOURGOYNE: Okay. That's good. Ten 13 working days or just ten calendar days? 14 CHAIRMAN SMITH: I work all days. 15 MR. BOURGOYNE: Yeah, that's what I'd say. 16 CHAIRMAN SMITH: Okay. All right. So are you 17 going to put that in the form of a motion or -- 18 MR. BOURGOYNE: I can attempt to do that. 19 CHAIRMAN SMITH: You can attempt to do that? 20 MR. BOURGOYNE: I'll enter a motion that if a 21 specific agenda item is given -- is put out with enough -- 22 with at least ten days notice that we'd be allowed to vote on 23 it at the next meeting. 24 MR. MARTIN: I'll second that. 25 CHAIRMAN SMITH: All right. All in favor? 0011 1 (Chorus of "ayes") 2 CHAIRMAN SMITH: Any opposed? Okay. 3 AGENDA ITEM VI 4 CHAIRMAN SMITH: All right. Discussion and 5 possible action on rules for work group meetings and 6 conference calls. And this is in, you know, kind of on the 7 same -- same lines of that. I think there was a work group 8 meeting that everybody kind of got a short notice on and not 9 a lot of people were able to attend or listen in on a 10 conference call. I think we probably need at least three or 11 four days notice, at the least, and it can be more than that, 12 I'm not making this in the form of a motion or anything, but 13 I think we need more of a notice to be able to attend a work 14 group meeting for all the BAC members, that way we can choose 15 whether or not to attend or attend via conference call or 16 something like that. 17 Any comments on that? 18 MR. MARTIN: I will go with the same -- 19 MR. BOURGOYNE: I don't see a reason why the 20 same procedure couldn't follow for the worker, it's a ten day 21 minimum -- ten day notice. 22 CHAIRMAN SMITH: Okay. I mean -- 23 MS. ROGERS: And would this be notice to all 24 BAC members or just the members that are on the work group? 25 CHAIRMAN SMITH: I would like to see all the 0012 1 BAC members notified. That way, you have the option to be in 2 on the meeting. 3 MR. MARTIN: In the notification of who's on 4 the actual work group, but the notice should go out to all 5 the new BAC members. 6 CHAIRMAN SMITH: Yes. Anything from the 7 public? 8 MR. BRESNEN: Oh, can I ask a question? 9 CHAIRMAN SMITH: Absolutely. 10 MR. BRESNEN: Sometimes members of the public 11 want to participate in those work groups. Is there a way -- 12 this may be a question for Michael, is there a way we can get 13 on the list? A lot of the agencies that I worked at will see 14 your list if there's, you know, something happening, they 15 send out an email for people that have indicated who 16 subscribed to a notification or at a minimum, if it was 17 posted on the website that there's going to be a meeting and 18 you know you get at least ten days' notice. That way, we 19 could participate in some way or at a minimum, listen in. 20 CHAIRMAN SMITH: Okay. And that was Steve 21 Bresnen. 22 MR. FARRELL: Specifically, excuse me, is a 23 mailing list -- we're not maintaining the mailing list, 24 necessarily, but I don't see if the BAC wants to post it on 25 their -- on their website, I don't see that as being a 0013 1 problem. 2 MR. BRESNEN: That would be great. This might 3 be for the legislative staff; do you all -- do you all -- 4 this is Mr. Bresnen. Do you all have a -- does agency have a 5 subscription list like the AG's office does or DMV or water 6 development board; you know, you get a notice when there's 7 going to be a meeting that you could subscribe to? Do you 8 all -- do you all have that capacity to set that up? 9 MR. FARRELL: Per individual, yeah. 10 MR. BRESNEN: Well, it's something to think 11 about. I don't know that we need to have a discussion, but 12 it would be good. It'd be good. 13 MR. FARRELL: Well, we'll look at that, but I 14 -- the easier -- I think the quicker one is -- 15 MR. BRESNEN: Sure. 16 MR. FARRELL: -- we can get it on the website. 17 MR. BRESNEN: Yeah. 18 MR. FARRELL: As long as BAC wants it 19 published on their site, we can put it on their site. 20 CHAIRMAN SMITH: Okay. 21 MR. MARTIN: Do we need a motion? 22 CHAIRMAN SMITH: Yes, sir. 23 MR. MARTIN: I'll make a motion we stick with 24 the ten-day rule on this and that we publish it on the 25 website. 0014 1 CHAIRMAN SMITH: Okay. 2 MS. ROGERS: I second that. 3 CHAIRMAN SMITH: All right. We have a motion 4 and a second, all in favor? 5 (Chorus of "ayes") 6 CHAIRMAN SMITH: Any opposed? All right. 7 Excellent. 8 AGENDA ITEM VII 9 CHAIRMAN SMITH: Okay. I'm going to deviate a 10 little bit from the agenda right here and since we've got the 11 -- item seven is the recommendations for the vacant seat. 12 Michael, would you like to address this at all or have 13 anything to say? 14 MR. FARRELL: No, I have nothing to say other 15 than we're expecting you would have some recommendations for 16 that. 17 CHAIRMAN SMITH: Yes, sir. I think we have a 18 couple. Okay. All right. The next agenda item is the BAC 19 recommendations for vacant seats and does anybody have any 20 recommendations? 21 MR. MARTIN: I was under the impression that 22 the Commissioners were the ones that pick the vacant seats? 23 CHAIRMAN SMITH: They are, sir. 24 MR. MARTIN: Okay. Shouldn't we, if there's 25 any recommendations -- I mean, are you talking about a 0015 1 recommendation to fill the vacancies? 2 CHAIRMAN SMITH: Yes, sir. I think -- 3 MR. MARTIN: I would think -- I would say if 4 there's any recommendations, if that's what this is here. 5 CHAIRMAN SMITH: Yes. 6 MR. MARTIN: And -- and that should be 7 submitted to the Commissioners, not to us. 8 CHAIRMAN SMITH: Yeah, I think -- I think what 9 Michael was wanting was us to, if we had recommendation, to 10 agree to recommend them for being picked by the Commissioners 11 at the next meeting. 12 MR. DUNCAN: Shouldn't that be posted on the 13 website so that everybody knows to put in a resume? I mean, 14 weren't there more nominations for the charity positions that 15 they already have their hands on? I mean, shouldn't we look 16 at all of them or? 17 CHAIRMAN SMITH: I agree with you, totally. 18 MR. FARRELL: Okay. 19 MR. BOURGOYNE: So you're saying the 20 Commission has a pool of charity representatives -- 21 MR. DUNCAN: I believe there was more than 22 just a couple of charities -- 23 MR. BOURGOYNE: And we want to add -- we want 24 to add this to the pool? 25 MR. DUNCAN: Right. Add that to the pool. 0016 1 MR. FARRELL: Yeah. 2 CHAIRMAN SMITH: Right, sure. 3 MS. ROGERS: So are we asking the BAC -- the 4 staff to send it to us, all of us? 5 MR. DUNCAN: Well, if we're going to make a 6 recommendation, shouldn't we see all the nominations? 7 MS. ROGERS: Right. 8 MR. FARRELL: This is -- my -- the way we're 9 wording -- not wording -- wording's the wrong word. The way 10 this is -- that if you have people that you're recommending 11 to be on the BAC, you will provide the names for that -- as 12 -- provide input for those names. If you're looking for 13 those people who are already on it, or already submitted 14 applications, we'll see about getting those names to you, but 15 looking for your -- anybody else that you would want or 16 people you just wanted, even if we have those names already? 17 MR. DUNCAN: I didn't even know that was going 18 to, you know, come up, until the agenda -- 19 MR. BOURGOYNE: Yeah, but we don't know what 20 names they have, we have no idea. 21 CHAIRMAN SMITH: Yeah. No, we don't. I did 22 -- I did give you all a -- 23 MR. DUNCAN: Okay. Do you want to recommend 24 that we add this to the pool -- 25 CHAIRMAN SMITH: Yes, absolutely. 0017 1 MR. DUNCAN: -- we can do that right now. 2 CHAIRMAN SMITH: Yeah. The -- yeah, 3 absolutely. 4 MR. FARRELL: Yeah. 5 CHAIRMAN SMITH: The -- I was going to make 6 this and one more -- oh, better yet, first, does anybody else 7 have any recommendations for someone to be in the pool? No? 8 Okay. 9 MR. DUNCAN: Are you going to do the public 10 comment? 11 CHAIRMAN SMITH: Yes, I'm going to get to that 12 in just a second, Ron. Stephanie Lewis had put her name in 13 the hat and if anybody else wants a copy of this, we'll get 14 this to you. She's been the -- her resume speaks for itself, 15 it's -- 16 MR. MARTIN: Which charity is Ms. Lewis? 17 MR. DUNCAN: She represents City Wide Club. 18 CHAIRMAN SMITH: Yeah, City Wide Clubs, yes. 19 MS. ROGERS: Right there? 20 CHAIRMAN SMITH: Yeah. 21 MR. MARTIN: Oh, okay, I'm -- 22 CHAIRMAN SMITH: Yeah. 23 MR. MARTIN: She's wanted to come in as a 24 charitable -- 25 CHAIRMAN SMITH: Yes. 0018 1 MR. MARTIN: Okay. 2 CHAIRMAN SMITH: Yeah. She just wanted to put 3 her name in the hat, is what it basically boils down to. 4 MR. MARTIN: Okay. 5 MS. ROGERS: Do we know what -- what hall is 6 that? 7 CHAIRMAN SMITH: Yeah, it's on here somewhere. 8 I don't see it on here, but we can find that out. 9 UNIDENTIFIED VOICE: Trace, if I may say, 10 she's placed in several halls. They've got different City 11 Wide ones; Houston, San Antonio, I think Austin, also. 12 CHAIRMAN SMITH: Okay. Do you know Stephanie? 13 UNIDENTIFIED VOICE: Yes. 14 CHAIRMAN SMITH: Yeah, okay. 15 MS. ROGERS: Well, she's the Bingo 16 Chairperson, so as far as I understand, you can only do that 17 -- can you do multiples? Can you do that? I would like to 18 know what halls she plays at. 19 DANNY: Trace? 20 CHAIRMAN SMITH: Okay. Yes? Danny? 21 DANNY: Danny from (Indiscernible) Supplies. 22 She plays at King's Bingo and I think she's got other 23 charities at Texas (Indiscernible). 24 CHAIRMAN SMITH: Okay. 25 DANNY: In Houston. 0019 1 MS. ROGERS: Houston. 2 DANNY: And she previously played at I think 3 Paradise Bingo, so she's been around a long time. 4 MS. ROGERS: Okay. 5 CHAIRMAN SMITH: Okay. All right. Ronnie 6 Baker? 7 MR. BAKER: Yeah, given -- given the size of 8 Texas and looking at the composition of the Board, there's 9 geographic areas in the State of Texas and I travel the 10 entire state, as you know, and I mentioned that there would 11 be some positions that were open. I wasn't sure how they 12 were going to be vetted, if it -- new applications were going 13 to be submitted to Doug Lowe for appropriate vetting and then 14 a recommendation back to you guys. But if you're saying 15 we're just going to take the existing ones that we have, when 16 there's people out there that I know that are interested, 17 represent a particular geographic area, such as the Rio 18 Grande Valley, West Texas, I think would be -- would it not 19 be appropriate to allot some time where they can submit an 20 application and have it vetted and given back to you guys for 21 consideration? 22 CHAIRMAN SMITH: Michael, that's okay? 23 MR. FARRELL: That's fine. 24 CHAIRMAN SMITH: That's okay? Okay. And I 25 think one of the things we're trying to do, the Commissioners 0020 1 and lottery staff had asked us to try to have some 2 recommendations ready for the next Commissioners; meeting; is 3 that correct? 4 MR. FARRELL: Uh-huh, yes. 5 CHAIRMAN SMITH: So -- 6 MS. ROGERS: With that said, I mean, you can 7 look at it like that or you can look at it with the ones that 8 Michael had -- has in his office, they stood up and 9 submitted, and that was open to everyone for quite a while -- 10 CHAIRMAN SMITH: Sure. 11 MS. ROGERS: So if you want to add this one 12 and then go through those first, I mean, there's something to 13 be said about that. 14 CHAIRMAN SMITH: Sure. 15 MS. ROGERS: But theirs was sitting there 16 first. 17 CHAIRMAN SMITH: Steve? 18 MR. FENOGLIO: This is Stephen Fenoglio. I 19 spoke with Doug Lowe at the last committee meeting. I -- he 20 is looking to the BAC for some specific recommendations, not 21 just here's the list of who submitted, pick; he's looking to 22 the BAC, you guys, to say these are -- and it could be, you 23 know, two or three or five for each spot, but he wants input 24 from you guys. 25 Obviously, the -- the one they selected for 0021 1 the public, it didn't go well, for whatever reason, she just 2 never showed and so he wants to avoid that. The next 3 commission meeting is in early February, so if you're going 4 to have input, you're going to have to do something other 5 than, well, here's the list, you guys choose. 6 MS. ROGERS: I -- I -- 7 MR. FENOGLIO: Make sense? 8 MS. ROGERS: It makes tons of sense and I 9 completely agree. My suggestion, this is my opinion and of 10 course I look to my fellow board members, is that a couple of 11 us step up to the plate, get these from Michael and go 12 through them, interview them. It's sort of the way we used 13 to do it in the old days and pick our new members from that. 14 It was open for the public for a long time -- 15 CHAIRMAN SMITH: Sure. 16 MS. ROGERS: -- to submit their applications. 17 That's my opinion of what we should do. And then we would 18 have something for the February meeting. And we would say, 19 these are the two individuals that we think would do well on 20 our board in this position, these are the two individuals or 21 one individual and, of course, not hand them a giant list, 22 they have enough to do. 23 MR. FENOGLIO: Okay. And to follow up on 24 that, from what Ronnie and Danny said, is there are people in 25 the room who can get the word out. If there are people who 0022 1 want to serve who aren't -- who haven't already submitted, do 2 that quickly, you could pick a date, we can put it on the 3 website -- I assume the division could put that on the 4 website, submit your names to: And resume. 5 I don't think anyone wants to keep anyone from 6 consideration, but -- 7 CHAIRMAN SMITH: Right. 8 MR. FENOGLIO: -- again, the commissioners are 9 looking to you guys and gals to say here -- here are two or 10 three or one or whatever that we recommend. 11 MS. ROGERS: And that would open it up for 12 individuals who are not -- 13 CHAIRMAN SMITH: Sure. 14 MS. ROGERS: -- there and just for that short 15 period because it's a limited time. 16 MR. DUNCAN: When is the next commissioners 17 meeting? 18 MR. FARRELL: The 13th of February, the Thurs 19 -- I think it's the 13th. 20 CHAIRMAN SMITH: Michael, what kind of 21 timeframe do you need to have our recommendations in by for 22 the Commissioners? 23 MR. FARRELL: Oh, we need at least two weeks 24 before the meeting. 25 CHAIRMAN SMITH: So the end of January? 0023 1 MR. BIARD: Bob Biard, General Counsel. I 2 just want to clarify, the Commission meeting is on the 7th. 3 MR. FARRELL: The 7th, I'm sorry. 4 CHAIRMAN SMITH: The 7th. 5 MR. FARRELL: I got the wrong -- I'm looking 6 now to make sure I got the dates right. 7 CHAIRMAN SMITH: So you mean today? 8 MR. BIARD: Yes. 9 MR. FARRELL: So you need those by today. 10 MS. ROGERS: How about the end of -- 5:00 11 tomorrow? 12 MR. FARRELL: No, I think -- I -- you could 13 put it out there, get the recommendations, take a week to ten 14 days. Part of what has to happen is they look at all of them 15 and create a list and then present it to the Commissioners on 16 the 7th. I think we can do -- I think you have ten days to 17 do it and we can turn it around. Bob, do you see that as 18 being a big problem, time wise? 19 MR. BIARD: Tell me again? 20 MR. FARRELL: If they can get it to us in ten 21 days, turn it around for the Commission meeting on the 7th? 22 Ten calendar days because they work weekends? 23 MR. BIARD: Sure. 24 CHAIRMAN SMITH: So by January 20th? 25 MR. FARRELL: Yeah. 0024 1 CHAIRMAN SMITH: Okay. Glenn? 2 MR. GOULET: Yeah. Glenn Goulet. I just have 3 a question. So by doing it this way, the way you're talking 4 about it right now, you're eliminating the public from 5 throwing their names into the hat, because you're looking for 6 names by a certain date of February the 7th. Legally, you 7 have to hit certain dates, you're asking in this group here, 8 the BAC, to come up with names and you're basically saying to 9 John Q. Public or Jane Q. Public, wherever they may be, 10 you're not in this. 11 CHAIRMAN SMITH: Well, in a pool of names that 12 were originally submitted, there are people from the general 13 public from that and I think what Kim was saying was we take 14 precedent with those group of names first, because those 15 dates were adhered to. 16 MR. GOULET: Okay. 17 CHAIRMAN SMITH: Does that make sense? 18 MS. ROGERS: It was open to the public for 19 quite a while. 20 MR. GOULET: Correct. 21 CHAIRMAN SMITH: Yeah. 22 MS. ROGERS: Yes. And so that -- in this 23 instance, we have to be very on top of our days. 24 MR. GOULET: But then my question would be, 25 you have a list of people, you have a list of people who were 0025 1 not selected to be that representative on the BAC, correct? 2 MS. ROGERS: True. 3 MR. GOULET: And the commission, the Lottery 4 Commission, has that list? 5 CHAIRMAN SMITH: Yes. 6 MR. GOULET: Why wouldn't they just go down 7 that list and vet the next person? 8 CHAIRMAN SMITH: I think -- 9 MR. GOULET: As opposed to coming out with a 10 brand new person. I -- 11 CHAIRMAN SMITH: I think -- I think what -- 12 and this alludes to what Steve Fenoglio said, I think the 13 staff is trying to give the BAC a little more autonomy in 14 choosing and making recommendations, since we're already a 15 formed board, so I think by them asking us to come with 16 recommendations, that's -- 17 MR. GOULET: Okay. 18 CHAIRMAN SMITH: -- we're trying to give -- 19 they're asking us for direction in who we want as our 20 representatives, which is huge. 21 MR. GOULET: Correct. Gotcha. All right. I 22 have no more questions. 23 MR. FARRELL: I will add -- I will add to 24 address that, if you need -- if we're going to post any of 25 this on the website, we need the wording, your recommended 0026 1 draft wording for the posting, quickly, so we can get it on 2 the website, if that's what you're looking for. 3 MS. ROGERS: So you're looking at opening it 4 up to the public for a time period, and we have ten days to 5 get it back to Michael? 6 CHAIRMAN SMITH: Yeah. 7 MR. DUNCAN: Just going from the list they 8 already have? 9 MS. ROGERS: That's my -- that's my personal 10 vote because it was open, but, I mean, I think if you gave it 11 until Sunday at 5:00, if you posted it this evening or in the 12 morning, I don't know how fast it takes to get something 13 posted on -- 14 MR. FARRELL: Part of it is the wording of 15 what you say and part of it is the timeline. 16 MS. ROGERS: Well, there's a lot of people in 17 this room that may know someone who would be able to spread 18 the words like wildfire and then at least then you do give it 19 to someone who is out here and they say, oh, yeah, I do have 20 time to do BAC, then, on Monday morning we get busy on 21 figuring out, I don't know. That's a lot in one week. 22 CHAIRMAN SMITH: Yes, it is. 23 MR. DUNCAN: Okay. You'd have to get copies 24 to everybody and we could do a conference call to do the 25 votes. 0027 1 MS. ROGERS: I would think take a -- 2 CHAIRMAN SMITH: So is -- is there a 3 recommendation? Are you going to make a recommendation? 4 MR. FARRELL: You could, and it was suggested 5 that one of the other options you have is you could wait 6 until the April meeting to have additional members on the 7 board, you could make that decision, too. There's not a 8 requirement, that I know of, that it has to be done in 9 February. 10 CHAIRMAN SMITH: Yeah, I think you're right on 11 that. 12 MR. DUNCAN: I make a motion we table it until 13 -- 14 CHAIRMAN SMITH: Well, I think -- I think 15 since the commissioners and Commissioner Lowe, specifically, 16 were asking us to do this, I think it would behoove us to 17 move our behinds and get this done for them. 18 MS. ROGERS: So I think that the members that 19 are on the board right now, this is my opinion, my 20 recommendation, that we decide whether or not we want to open 21 it up to the public, or we want to go with the list that they 22 currently have. 23 CHAIRMAN SMITH: I think if we go with the 24 list that they currently have now and then maybe the next 25 opening, open it up to the general public, we may solve our 0028 1 problem. 2 MS. ROGERS: I would go along with that. 3 MR. MARTIN: Are we going -- are we -- we're 4 going to go with their list, is that what you're saying? 5 MS. ROGERS: We're going to use their list to 6 find our two new members and not open it back up to the 7 public right now, because we have so many applications. 8 Michael, are there -- I know I'm kind of calling 9 you right on the spot, are there quite a few applications or 10 are there four, do you know, like, roughly? 11 MR. FARRELL: Roughly, there were -- there 12 were two to three folks per position that I remember, off the 13 top of my head. 14 MR. DUNCAN: So there's still a pool? 15 MS. ROGERS: So there's still some 16 individuals? 17 CHAIRMAN SMITH: Yes. 18 MR. MARTIN: Well, we can go through that list 19 and if they want -- if they're wanting us to make 20 recommendations, then how are we all going to -- how are we 21 going to get our hands on that list? Or are they just going 22 to go over the list and pick them themselves? 23 MR. DUNCAN: I think Trace can email that 24 stuff to us -- 25 CHAIRMAN SMITH: Absolutely. 0029 1 MR. DUNCAN: -- and we'll have a conference 2 call before the 20th. 3 CHAIRMAN SMITH: Michael, would it be a big 4 deal to get that list to -- just email it to us or is it in 5 hard copy or -- 6 MR. FARRELL: I don't think it's going to be a 7 big deal, but I'll let you know -- 8 CHAIRMAN SMITH: Okay. 9 MR. FARRELL: -- within -- by the -- before 10 the end of the day. 11 CHAIRMAN SMITH: Okay. All right. That'll 12 work. So Kim had suggested that we use a selection committee 13 or are we all going to do that together? 14 MR. FARRELL: Should be everyone. 15 MR. MARTIN: Committee. 16 MS. ROGERS: Whole board. 17 CHAIRMAN SMITH: I agree with that. 18 MS. ROGERS: Okay. 19 CHAIRMAN SMITH: Okay. Good, good, good. All 20 right. So any other comment on that? 21 MS. GREEN: What positions, Trace, do you have 22 open? The charity position and the public? 23 CHAIRMAN SMITH: I think it's charity and 24 public. Isn't that correct, Michael? 25 MR. FARRELL: Yes, sir. 0030 1 MR. FENOGLIO: Yes, sir. charity lessor and 2 public. 3 MS. GREEN: Public's really rough. 4 CHAIRMAN SMITH: Yes. 5 MR. BOURGOYNE: I think it's charity lessor, 6 not just charity -- 7 MR. FENOGLIO: Yes, charity lessor. 8 MR. FARRELL: I think so. 9 CHAIRMAN SMITH: Okay. Any other discussion 10 on that? 11 AGENDA ITEM VIII 12 CHAIRMAN SMITH: All right. Go to Item Number 13 VIII, Keller Work Group, Kris Keller. Would you like to -- 14 MR. KELLER: Sure. 15 CHAIRMAN SMITH: -- talk about the meeting you 16 had? Yeah, absolutely. 17 MR. KELLER: My name's Kris Keller and we did 18 -- we did have a meeting at our bingo hall pertaining to the 19 -- it started off, I just wanted to have charities -- the 20 opportunity where we could put more than 66 cards on a 21 computer, but we may have muddied the water, so to speak, at 22 this meeting, by adding other stuff to it. 23 The bottom -- the question -- it was brought 24 up, the bottom line is -- is to bring more revenue to the 25 charities, you know, raise their income. So it was brought 0031 1 up, maybe we should look at setting a minimum price, the 2 lottery. 3 It was all -- everybody liked the idea, you 4 know, but it might've muddied the water, like I say, where we 5 might be better off going back to the original thing, which 6 was to put more cards than 66 on the computer, in 66 card 7 increments. 8 It was also brought up at this meeting that 9 maybe by doing the minimum price, it would stop some bingo 10 operator in the state from -- instead of offering 66 cards 11 for $3, which it is now in Bexar County, they might say, 12 well, you can get 665 cards or 60-whatever, for the same 13 price, for $3. 14 So that was why that minimum price was brought 15 up, too, to stop that. But, I know to myself and every 16 charity that I've spoke to is in favor of putting more than 17 66 cards on a computer, which would allow charities to lower 18 their inventory of machines. And I'm going to ask the 19 question again, all we have to do is ask anybody, how does 20 this rule benefit the charities? 21 There's a lot of distributors here today, 22 manufacturers, other operators, I'm going to open it up right 23 now and just say, is there anybody that can stand up and tell 24 the Bingo Advisory Committee how this rule benefits a 25 charity? 0032 1 CHAIRMAN SMITH: Which rule? 2 MR. KELLER: The 66-card limit, by not 3 allowing us to put more than 66 cards on the machine. 4 CHAIRMAN SMITH: Well, in -- I don't know if 5 it benefits the charity or it detriments the charity, but the 6 rule is the rule. I know in our particular hall, we like to 7 keep a good balance between electronic winners and paper 8 winners, we try to, you know, limit the amount of 9 electronics, if you will. 10 MR. KELLER: And that's a great idea. 11 CHAIRMAN SMITH: I think if -- if you start 12 increasing the amount of cards and electronics, it may upset 13 that balance. Now, keep in mind that's just me, 14 specifically, but I'm not here for me, specifically, I'm here 15 for the good of the industry. 16 MR. KELLER: Well, here's the problem with it, 17 though, Trace, is that we don't have a limit on what a 18 customer can buy, so -- and we have -- I brought it up last 19 time, we have one lady in particular, she buys 65 computers. 20 CHAIRMAN SMITH: What -- what's her name? No, 21 I'm kidding, I'm kidding. I'm kidding. 22 MR. KELLER: I'm sure it's at Richard's hall 23 and Kim's hall, you know, but it's detrimental to the bingo. 24 MR. BOURGOYNE: So how can we have a 25 conversation about increasing the number of faces per device, 0033 1 without having a conversation about limiting the number of 2 devices per person? 3 MR. KELLER: I'm all for it. I mean, I'd be 4 for anything that would help us, because, you know, 5 anything's better than nothing, but what I'm telling you 6 right now -- and I understand what you're saying, Trace, and 7 I wish we had that balance in our hall and that's why 8 electronics were even brought into the market, they work for 9 everybody. It was a specific percentage of your people that 10 you wanted to sell it to and you got a premium price for it. 11 Maybe you're still able to get a premium price for -- how 12 much are you selling the computer for? How much is a 13 computer at your hall? 14 CHAIRMAN SMITH: Which one? 15 MR. KELLER: Fully loaded? 16 CHAIRMAN SMITH: I don't sell it fully loaded. 17 MR. KELLER: Well, what's your cheapest 18 computer? 19 CHAIRMAN SMITH: Five dollars. 20 MR. KELLER: What's your most expensive 21 computer? 22 CHAIRMAN SMITH: It depends on how much you 23 want to spend, you can load up as many packages as you want 24 to, you just can't go over 66 cards. 25 MR. KELLER: Can somebody spend $30 on a 0034 1 computer? 2 CHAIRMAN SMITH: Sure. 3 MR. KELLER: Can they spend -- they can't in 4 my hall, I mean, I'm telling you, there's a hall in San 5 Antonio, Texas, that sells their computer for $3 a session. 6 Anyways, I'm going to ask this Bingo Advisory Committee, I 7 didn't see any of that come up -- 8 CHAIRMAN SMITH: Chris, let me ask you a 9 question; does the Work Group have a recommendation -- 10 MR. KELLER: A recommendation, I'm going to 11 give it to you right now. 12 CHAIRMAN SMITH: Okay. And this is from the 13 Work group, correct? Or from you? 14 MR. KELLER: Well, I'm changing the 15 recommendation from the Work group, because I think that the 16 $8 minimum computer got some resistance and I'll pitch it out 17 there. 18 CHAIRMAN SMITH: Okay. 19 MR. KELLER: I'll throw it. The 20 recommendation, if I remember correctly, correct me if I'm -- 21 I mean, if I'm wrong, you tell me. It was to allow 132 cards 22 on the computer, set a minimum price to $8 a computer, that's 23 not a maximum price, that's just the minimum price that you 24 can sell a computer for and don't allow double action 25 optionals or don't allow double action paper on the machine. 0035 1 CHAIRMAN SMITH: Why? 2 MR. KELLER: Again, it was to stop an operator 3 from saying, you can get all double action cards from me for 4 8 bucks. You know, I think that that was the reason why. 5 MS. ROGERS: I believe there was also that the 6 $8 was for the first 66 cards, once they climbed up from 7 there, it had to be $8 more, is that correct? 8 MR. KELLER: Correct. Right. So in other 9 words, if somebody said, okay, give me a machine with 132 10 cards on it, it's 16 bucks. 11 Now, in areas of the state where you're 12 getting more than that, that's beautiful, take it while you 13 can get it. But, in areas of the state where you're not 14 getting that, you're making all your money off of tab sales. 15 You're losing money at your window and you're picking it up 16 on your tab sales. And that work -- it's working, but will 17 it continue to work? 18 CHAIRMAN SMITH: So -- let me -- let me ask a 19 question, if you have an $8 minimum on your first 66 cards -- 20 MR. KELLER: Right. 21 CHAIRMAN SMITH: -- what happens to someone at 22 a small hall, like what I run, and it's only $5? 23 MR. KELLER: You'd have to go up to eight. 24 Would that be a good thing or a bad thing? 25 CHAIRMAN SMITH: Well, it might be a bad 0036 1 thing. 2 MR. KELLER: Is it better to go lower than 3 eight? No. So here it is; they go to your hall and spend 4 $8, go to your competitors hall and spend $8. 5 Right now, Trace, if you're using that, if 6 you're using price, you know, I got to lower my price to get 7 them in my door -- 8 CHAIRMAN SMITH: Uh-huh (affirmative). 9 MR. KELLER: -- and everybody else in your area 10 does the same thing, have you done anything? Have you 11 benefitted other than, well, gee, now we're all at 5 bucks. 12 This way, we'd all be at 8 bucks. 13 MS. GREEN: Trace, I feel your pain, but I 14 think it's a real slippery, scary road to let the Lottery 15 Commission start telling us how much to sell something for. 16 MR. KELLER: Why? They do it now on pull 17 tabs. 18 MS. GREEN: Well, I understand, the 19 manufacturer thing is right, a dollar a tab, but I -- 20 MR. KELLER: Okay. Richard was in the Work 21 group -- 22 MR. BUNKLEY: I was in the Work group and I 23 agree with everything Chris has said philosophically. I 24 think Chris is right, the Work group was hijacked. The 25 initial intent of the Work group was to eliminate regulation. 0037 1 UNIDENTIFIED VOICE: State your name, please. 2 MR. BUNKLEY: My name is Richard Bunkley. The 3 initial intent was to eliminate regulation, to get rid of the 4 limit on the number of cards. So it's kind of ironic, the 5 path of least resistance we found, was more regulation in 6 setting a minimum price. 7 So I think maybe another meeting is in order 8 and we go back to the original intent; should we eliminate 9 the limit on the number of cards? And I lean towards yes and 10 I'm sympathetic to your concerns that we are making the paper 11 obsolete, but I would argue it's already obsolete in a lot of 12 places. The only thing the limit on the number of cards does 13 is force Chris's charities to have to buy 700 computers in 14 their hall, when they should only have to buy one per 15 customer, and let that customer buy however many cards they 16 want. I think they're going to play the same number of 17 cards. 18 So that's my humble opinion. I think that the 19 intent of the Work group was kind of sidetracked and maybe 20 another meeting is in order. 21 CHAIRMAN SMITH: Okay. All right. So Chris, 22 do you want to go through all your recommendation and let 23 there be another meeting to kind of iron that out? 24 MR. KELLER: I'll make the recommendation and 25 have another meeting if it doesn't go through. 0038 1 CHAIRMAN SMITH: No, do what now? 2 MR. DUNCAN: I don't think so. 3 CHAIRMAN SMITH: I'm sorry. I lost you there. 4 MR. KELLER: Can I make a recommendation and 5 then if it doesn't go through, have another Work group 6 meeting? 7 MR. DUNCAN: You don't want to make a 8 recommendation and have us vote on it now before we have 9 another meeting, you're going to want to have that meeting 10 and then come back. 11 CHAIRMAN SMITH: I think -- I think -- and I'm 12 not -- I may be speaking out of turn here but I think the BAC 13 would like a lot more information on this than what we have 14 now. I wasn't at the meeting, I didn't -- I didn't know 15 about it in time. I would've loved to have been there 16 because I'm a numbers guy in my hall and I like checks and 17 balances and I like everything to be smooth. I don't like 18 the boat to be, you know, heavy in the back or heavy in the 19 front, so there's a lot of variables to doing that, that I 20 can just see right off the top of my head. 21 I really think that there's a lot more 22 information to be looked into before we actually vote on 23 that. I would make the recommendation that we have another 24 meeting first. 25 MR. DUNCAN: I believe that in the summary 0039 1 that I sent all the BAC members -- 2 CHAIRMAN SMITH: Right. 3 MR. DUNCAN: -- I just gave you a summary of 4 the meeting. 5 CHAIRMAN SMITH: Yes. 6 MR. DUNCAN: I said there was a whole lot more 7 to be done -- 8 CHAIRMAN SMITH: Yes. 9 MR. DUNCAN: -- and this is going to happen at 10 this meeting. 11 CHAIRMAN SMITH: Yeah, and it was very clear 12 what was going on. 13 MS. ROGERS: If you look at what the -- what 14 the -- 15 MR. DUNCAN: But there were other people that 16 weren't there, I think we said that in a meeting. There's 17 none of the other groups were involved in it and it was just 18 a sit down with Chris and Richard to find out exactly, and 19 the work group to find out exactly where their heads were at 20 on some of the stuff. 21 CHAIRMAN SMITH: Gotcha. 22 MS. ROGERS: If you look on the basis of what 23 it was started as, we do have that same lady and she comes in 24 and she discourages other people because the lady that comes 25 in and buys two computers thinks that she's already beat when 0040 1 she hits the door, but she sees the lady -- hang on a second, 2 I won't say her name so nobody else steal her. You know, 3 sitting there with her 15 or 20 computers and they 4 automatically and they might -- even though they're really 5 not, I have seen her come in that -- our hall and not win a 6 thing, and I might add that Chris has a very successful hall 7 -- paper hall, so kudos to you, you know, that's great. So 8 it -- the -- the grounds of it, of being able -- it gets a 9 little more exciting, maybe it'll add more excitement to 10 bingo if they can have more cards on one computer. So it 11 does need to be looked at further. 12 I feel your pain going to the $8, trust me, 13 I'm with you. I feel you. But, that's another thing -- 14 CHAIRMAN SMITH: So if I understand what 15 you're saying is, is you have a lady that comes in and buys 16 15 computers and the people that have two don't feel like 17 they have a fair chance? 18 MS. ROGERS: Oh, they'll complain about it all 19 day long. I believe they probably call Michael and say how 20 people buy so many computers -- 21 MR. POHL: I have the same problem. 22 CHAIRMAN SMITH: That's -- that's -- I think 23 that's in every hall in Texas, you have that one person that 24 spends more than the other and unfortunately, that's the same 25 way with lottery tickets, the more you buy, the better odds 0041 1 you have. 2 MS. ROGERS: That's what I was going to say. 3 We had, one time, an undercover come into one of our halls 4 and they were looking at someone and this lady buys bundles 5 of pull tabs. She buys bundles, she wins more, that's what 6 happens, versus the person that buys five tabs, so. 7 CHAIRMAN SMITH: Mr. Bishop, would you like to 8 weigh in on this? 9 MR. BISHOP: I might as well. 10 CHAIRMAN SMITH: I just caught about the end 11 of it. 12 MR. BISHOP: I need a deep breath. Don 13 Bishop. We've got some changes in -- 14 CHAIRMAN SMITH: Hold on, Don. You need to 15 come up. They can't -- the court reporter can't hear you. 16 MR. BISHOP: My name is Don Bishop, I'm a 17 commercial lessor, among other things. 18 We have some proposed changes, I believe, 19 coming up in the playing times, the number of times a day, 20 and some various changes, so the group might want to think 21 about waiting to see how that shakes out before we make any 22 dramatic changes in what we're doing right now. 23 CHAIRMAN SMITH: Okay. All right. Thank you, 24 sir. 25 MR. KELLER: I just want to say, also, that 0042 1 I'll wait -- I'll wait on this proposal thing here, but I'm 2 not going to stop it. 3 CHAIRMAN SMITH: Okay. 4 MR. KELLER: And if I come back next meeting 5 and say, okay, I want to do this where we can put more cards 6 on the computer and nobody else in this room will stand up 7 and say, no, no, here's why you don't want to do that, then 8 I'm going to say, we need to push it forward, and go, because 9 it will benefit the charities that operate bingo, it'll be 10 money to their bottom line. 11 You know, it was tried once before with the 12 lottery where they put that 40 percent rule on where only 13 that money can play a computer in your hall. Well, it was 14 designed to curtail the number of people playing a computer, 15 but it was a disaster, it didn't work. So -- and I think 16 that the distributors would rather see us put more cards on a 17 machine than see us vote to say, okay, let's put a limit of 18 150 computers, max, in a hall. Or I think that they'd rather 19 see us put more cards on it, but again, the whole idea is to 20 raise the dollars for the charities, you know, more money in 21 their kitty at the end of the day. 22 CHAIRMAN SMITH: And you've done -- putting 23 more cards on a computer will lessen the amount of computers 24 in a hall, therefore, saving the charity money, is that 25 correct? 0043 1 MR. KELLER: I guarantee it. 2 CHAIRMAN SMITH: Okay. 3 MR. KELLER: You know, that may be a more fair 4 question to ask, instead of asking anybody to stand up and 5 say how this would not benefit the charities, ask the 6 distributors how it would hurt them or help them with it. 7 MR. MARTIN: Myself, I'm -- I'd rather -- I 8 want to see some hard data because you start loading all 9 these computers up with more games, you're going to have more 10 people bingoing at the same time, or people who have quit 11 going to bingo because instead of a $200 pot, I won 12 bucks 12 or something like that and so I need to see some data. I 13 don't want just well, this is my opinion, you know what they 14 say about opinions. 15 MS. ROGERS: Well, it all has to start with an 16 idea -- 17 CHAIRMAN SMITH: Yes. 18 MS. ROGERS: -- so it's not an opinion, it's 19 an idea, wouldn't it be the same, though, if you can load, 20 let's just hypothetically say, you can load three sets of 66, 21 what's the difference of me sitting here with three computers 22 and you sitting there with one? So there is more research 23 that needs to be done -- 24 CHAIRMAN SMITH: Yes. 25 MS. ROGERS: -- more avenues. Also, Mr. 0044 1 Keller, please remember to notify everyone. We have to be 2 better at notifying everyone for the meeting. 3 CHAIRMAN SMITH: Yes. 4 MS. ROGERS: So that way, everyone is included 5 when you have the next meeting. 6 CHAIRMAN SMITH: Yes. I think the -- the 7 deadline is ten days before the meeting. 8 MR. KELLER: Okay. 9 MS. ROGERS: Okay. 10 MR. KELLER: Can you tell me who's in my work 11 group? 12 MS. ROGERS: I can. I did send an email to 13 you, I will resend it. 14 MR. KELLER: Okay. 15 MS. ROGERS: Yes. 16 MR. DUNCAN: It's me, you, Danny and Richard. 17 MR. BOURGOYNE: I believe I'm still on it. 18 MR. KELLER: No. 19 CHAIRMAN SMITH: Yes, Emile. And -- and this 20 is a question for -- 21 MR. KELLER: Me, you, Danny and Richard? 22 MR. DUNCAN: And Emile. 23 MR. KELLER: And Emile. Yeah, you were on the 24 phone, that's right. 25 CHAIRMAN SMITH: So this is -- let me ask 0045 1 Emile and Tommy a question real quick. Are there other 2 jurisdictions that allow more than 66 cards in the computers 3 and how does that work, how does that translate? 4 MR. BOURGOYNE: Yes, there are other 5 jurisdictions that allow more than that, but, those 6 jurisdictions typically have a limit on the number of devices 7 a player can play. 8 MS. ROGERS: What would those be, or just one 9 of them -- 10 CHAIRMAN SMITH: Could you get -- could you 11 get some data together for us, maybe? 12 MR. BOURGOYNE: Yes, I'll do that for you. 13 CHAIRMAN SMITH: Okay. All right. And that 14 may help your work group make a decision on making a 15 recommendation. Tommy and you? 16 MR. DUNCAN: Yeah, I think we can get with the 17 card manufacturers, they should be able to give us that. 18 MR. BOURGOYNE: That's who I plan on going to. 19 CHAIRMAN SMITH: Okay. All right. Excellent. 20 MR. DUNCAN: All of them were in the room. 21 CHAIRMAN SMITH: Okay. Excellent. Well, why 22 don't we do that and then Chris, if you want to pick a 23 meeting date or something and get that to us, we'll send that 24 out to the -- to the Board and get it posted on the website. 25 MR. KELLER: You can send it to Trace and he 0046 1 can put it on the website. 2 MR. DUNCAN: Okay. That's fine and you're 3 more than welcome, I mean, do you have to be in the work 4 group to be at the work group meeting? 5 CHAIRMAN SMITH: No. No, anyone can attend. 6 MR. KELLER: Anybody that's here in this room 7 is more than welcome to come, anybody. 8 MS. ROGERS: Thank you. 9 CHAIRMAN SMITH: Okay. All right. 10 MR. KELLER: That's all right. Okay. Is that 11 -- all right. 12 MS. GREEN: Just one more thing; when you're 13 doing your work group, I understand what you're saying and 14 that makes -- it makes a lot of sense, but anything that's 15 going to be a price fixing or allowing the Lottery Commission 16 to tell us what we can sell, how much we can sell of it, or 17 how much we can sell it for, as a lessor, I'm going to be -- 18 MR. POHL: I'm asking for this as well. 19 MS. GREEN: You know, and I understand -- I 20 understand every one is different, we have a different -- 21 CHAIRMAN SMITH: Yeah. 22 MS. GREEN: -- thing in Dallas, it's called 23 Westar (Indiscernible), so it's not -- it's not all of them, 24 so and I have -- 25 MS. ROGERS: That's where it derives from -- 0047 1 where it derives from, from the undercutting going in the 2 back door -- 3 MS. GREEN: I understand, yeah, because 4 there's no halls in Dallas that are going to say they don't 5 want it, so that's not a problem. Don't hold your breath. 6 Yeah, I know. 7 CHAIRMAN SMITH: Thomas, if I -- 8 MS. GREEN: I have a $5,000 bottle of water 9 from Choctaw. 10 CHAIRMAN SMITH: All right. So are there any 11 other comments on this work group? 12 MR. BISHOP: I'd like to enter this as 13 evidence. 14 CHAIRMAN SMITH: Thank you, sir. Okay. Are 15 there any other comments on the work group? Chris, you'll 16 get with us on the meeting date? 17 MR. KELLER: Yes, sir. 18 CHAIRMAN SMITH: All right. Thank you very 19 much. 20 MR. KELLER: Thank you, very much. 21 AGENDA ITEM IX 22 CHAIRMAN SMITH: All right. Number nine, 23 discussion and possible action on electronic pull-tab 24 machines. I put that on the agenda because there are some 25 manufacturers out there that do have pull-tab machines with 0048 1 electronic verification. I don't want to say their name, 2 they don't want to make a presentation or anything like that, 3 but just I wanted to make everybody aware and kind of, I 4 guess, tip your hat a little bit and see if you want to 5 discuss that further at a following meeting. I don't think 6 it's anything that we would want to make a recommendation on 7 right now. I think we would have to have a Constitutional 8 amendment to get that done, but that may be something that 9 could possibly be done on another session down the road or 10 something like that. 11 But, Tommy, do you have any thing -- 12 MR. DUNCAN: Where did it come from, I mean, 13 where -- 14 CHAIRMAN SMITH: From me, from me. 15 MR. DUNCAN: Did somebody approach you or? 16 CHAIRMAN SMITH: Well, there's -- there's 17 certain manufacturers that are demonstrating machines around 18 the state, in hopes to get recommendations. I didn't want to 19 put that on the agenda for having -- 20 MR. DUNCAN: Well, we -- I have talked with 21 some other distributors, we had a conference call as we do 22 before each meeting and they -- there's a lot of legal issues 23 involved in that -- 24 CHAIRMAN SMITH: Agreed. 25 MR. DUNCAN: -- we should probably hand that 0049 1 back to the -- to Michael to, you know, to see what the do's 2 and don'ts are going to be on that. 3 CHAIRMAN SMITH: Okay. 4 MS. ROGERS: Are these machines to sell event 5 tabs and pull-tabs or are these machines just to verify? 6 CHAIRMAN SMITH: Both. 7 MS. ROGERS: Oh. Kind of what the lottery has 8 in the stores? 9 MR. BOURGOYNE: No, no. 10 CHAIRMAN SMITH: No, I think this would be an 11 electronic representation of a ticket, with electronic 12 verification. 13 MR. BOURGOYNE: Actually some dispense an 14 actual ticket, though. 15 CHAIRMAN SMITH: Yes, they have -- they do. 16 But, it's something that I felt like the Board needed to be 17 aware of, they needed a heads-up on, because it's coming down 18 the road. It's going to be talked about more and more and I 19 didn't want you all to be blindsided by it later on down the 20 road and go, well, why didn't you tell us this? 21 MS. ROGERS: And this is something that would 22 be allowed in bingo halls or anywhere? 23 MR. BOURGOYNE: It'd be a bingo product. 24 MS. ROGERS: A bingo product. 25 MR. BOURGOYNE: Yes. 0050 1 MS. ROGERS: Okay. 2 MR. BOURGOYNE: It'd have to fall under the 3 bingos -- pull-tab bingo statutes and pull-tab bingo 4 definitions by statute. 5 MS. ROGERS: Okay. So only bingo halls? 6 MR. BOURGOYNE: Yes. 7 CHAIRMAN SMITH: Okay. Any other comments on 8 that? 9 MS. GREEN: I'm for anything that just helps 10 us expand what we can sell. This would be a benefit. 11 CHAIRMAN SMITH: Okay. 12 MS. ROGERS: I -- I would like to see what 13 this is, what it's about, I mean, I can't say yes or no if I 14 don't know what it is. 15 CHAIRMAN SMITH: Absolutely, absolutely. 16 Okay. All right. Anything else on this item? All right. 17 AGENDA ITEM XI 18 CHAIRMAN SMITH: Discussion and possible 19 action on illegal gambling, in reference to prize fees going 20 to general funds, talking about the bill -- House Bill 3611 21 (2017 Lucio III/ Keumpal). Steve Bresnen, do you want to 22 elaborate on this a little bit? 23 MR. BRESNEN: Well, that's a bill number from 24 last session. 25 CHAIRMAN SMITH: Right. 0051 1 MR. BRESNEN: And the idea is, I think Mr. 2 Martin and I had a brief conversation a little earlier, Steve 3 Bresnen, and he pointed out that there are no eight-liner 4 game rooms in his county at this time. 5 MR. MARTIN: That's correct. We went from 69 6 game rooms in Victoria, and Victoria is not that big of a 7 city, we had one on every corner. And that was -- that was 8 December the 30th, and January the 3rd, we had zero. 9 MR. BRESNEN: So how did -- that got done by a 10 city ordinance? Is that -- 11 MR. MARTIN: Yes, we -- I went and talked with 12 the Sheriff's Department and our sheriff share out there, T. 13 Michael O'Connor, is pretty sharp. And he told me, Will, go 14 to the City Council, he said if you go to the City Council, 15 they can close those game rooms overnight. And so I went and 16 talked with the City Council and the police chief. They 17 passed the ordinance, I have seven copies left, so Kim got 18 one, anybody that wants one. 19 Basically what this ordinance does, the real 20 kicker to it is that you have to be -- you cannot be an 21 individual, you have to be a company or a corporation to 22 apply for one. 23 CHAIRMAN SMITH: Can you send that to me in 24 electronic format as well? 25 MR. MARTIN: Yeah, I can email it to you. 0052 1 CHAIRMAN SMITH: Please. Thank you. 2 MR. FARRELL: And Will, can you send that to 3 me as well, please? 4 MR. MARTIN: I will, sir. 5 MR. FARRELL: Thanks. 6 MR. MARTIN: And an individual can't open a 7 gaming -- well, first, if you want to open a game room in 8 Victoria because game rooms are legal in the State of Texas, 9 if you follow the rules. You have to -- you have to give 10 them $800 for a processing fee and it's non-refundable. If 11 you -- if you don't adhere to all these rules, you don't get 12 your money back. If the company or corporation that wants to 13 open that game room, they have to be registered with the 14 State of Texas, the State Comptroller's Office. They have to 15 send one of their officers to Victoria. That officer of that 16 company, along with the person that they're going to lease 17 the building from, has to go down and sit across the desk 18 from the Chief of Police and they have to sign an affidavit 19 or a document saying that they know that they can be held 20 criminally liable if there is any illegal activity that goes 21 on in that game room. 22 And if you read on in there, it also gives the 23 police chief the power to -- if he just thinks there's 24 illegal gambling going on in there, he can shut it down 25 without an evidentiary hearing. 0053 1 So they all decided, I think from what I 2 understand, they all departed. 3 CHAIRMAN SMITH: What I think I hear you 4 saying is legalized gaming's in Victoria. 5 MR. MARTIN: Legalized -- the game rooms are 6 legal in the State of Texas. 7 CHAIRMAN SMITH: Oh, okay. 8 MR. MARTIN: Now -- 9 MR. BRESNEN: So the point of this bill and 10 the reason I asked Mr. Martin to talk about that is that 11 something can be done if law enforcement authorities do their 12 job. They could have -- I suppose they could've moved 13 outside into the county, outside of the City of Victoria, out 14 into the county -- 15 MR. MARTIN: Our sheriff -- our sheriff 16 invited them to move out into the county. 17 MR. BRESNEN: Yes. And so his sheriff, 18 obviously, is -- has told them and hopefully the DA that 19 they'll do their job. 20 So the point of this bill is to acknowledge 21 that the BPS, the sheriffs in the state, the police chiefs in 22 the state have the ability to shut down the game rooms. If 23 they choose not to use their limited resources, they have 24 limited resources, if they choose not to use them in that 25 way, you know, that's their choice, they get elected, I don't 0054 1 get to pick them, but there's no reason that bingo ought to 2 suffer as a result of that. So the bill would authorize the 3 Lottery Commission to, in essence, declare that there's 4 illegal gambling happening in a county. If the county wants 5 to contest that or the city could contest it, I guess, under 6 the bill the DPS could contest it, but if they decision is 7 final by the Lottery Commission, then henceforth, the prize 8 fees from bingo, both the state and the local component of 9 that, would go to the general fund of the charities. 10 So if the government doesn't do its job, then 11 that's the governments choice, but there's no reason why 12 bingo in those areas ought to subsidize the government when 13 its not doing its job to the detriment of the charities. 14 This bill has a little due process in it. The cities and the 15 counties and these folks, they don't have the right to this 16 money constitutionally, it's not -- they don't have the same 17 due process rights as you would individually if somebody was 18 trying to take or withhold something from you. But, the bill 19 does give them the ability to come to the Commission and 20 contest that. 21 The bill does not give the authority -- the 22 Commission any authority to go and investigate, send the 23 enforcement people out, all those kinds of things. I don't 24 think the legislatures going to fund that, for one thing, 25 because they're pretty cheap, and they -- there's many people 0055 1 and -- that don't want to create a statewide anti-gambling 2 enforcement capability, beyond what we already have in the 3 DPS today. So I think the way the bill would practically 4 work is that an organization, like pre-January 1st, Mr. 5 Martin's organization could come to the Commission and if I 6 were them, I'd show a bunch of pictures of 69 game rooms on 7 every corner and I'd have some people that were willing to 8 say that illegal gambling is going on in those places and put 9 it on the Commission to make a finding. And the bill -- the 10 Commission can flesh that out a little bit with its rule 11 making authority, but the object is to shift the burden to 12 the folks who have the responsibility to enforce the 13 anti-gambling laws in the state. And if they don't, that's 14 their choice, they've got drug cartels, rapists, and other 15 people to go after, usually, and they can make those choices, 16 but bingo should not suffer as a result of it. 17 We know that, at least before House Bill 2578, 18 there was about 29 million dollars a year going to the state 19 and local governments from prize fees. And so, it would be a 20 thrill to me, last time we carved out some money from the 21 local allocation. I think Michael told me the other day that 22 that's almost four million dollars a year that's now going to 23 the charities where they're not having to pay the license 24 fees and the temp fees and the registry fees. We got them 25 1.4 million dollars in refunds back. That was a pretty fair 0056 1 day's work. 2 So I think if we can go at those prize fees 3 and give the locals an incentive to do the job, then who 4 knows, maybe we'll get somewhere. If not, maybe at least the 5 prize fees will go to the charities. Keep in mind, we have 6 the other bill that's going to -- if we could pass it, is 7 going to require that the local governments opt in to keep 8 getting the prize fees, rather than just getting it, so we're 9 going to give some politicians the opportunity to vote for 10 taxes. 11 So those are two of the things -- two of the 12 major things we have on the bingo interest group's agenda at 13 this time. I think TCA is -- or no? Is Tom here? Steve, 14 TCA -- TCA is in support of that effort, too, right? 15 MR. DUNCAN: Sure am. 16 MR. BRESNEN: And any other -- anybody else, 17 any other groups that wave the flag about that, we'd very 18 much appreciate it. I'm happy to answer any questions that 19 anybody has. 20 MS. GREEN: The charities do get that money, 21 though? If the city has opted, it goes to the charities, 22 right? 23 MR. BRESNEN: The money would go directly into 24 the charity's general fund. It would be withdrawn from the 25 player and deposited into the general fund of the charity. 0057 1 So this is not something to go pay bingo expenses with or 2 anything, this is to go to the bottom line. 3 MS. GREEN: And that's -- what would happen 4 with the -- if eight-liners were found in the -- in the 5 county, it would go back to the charities that play within 6 that county? 7 MR. BRESNEN: Of the -- every -- the entire 8 county -- let's just say this was Victoria, the City of 9 Victoria, right? 10 MS. GREEN: Yes, sir. 11 MR. BRESNEN: It doesn't matter. The 12 designation would be for the county, because the DPS has 13 authority in that county, the sheriff has authority in that 14 county, and the police have authority within the city. The 15 sheriff could have gone into the City of Victoria, my guess 16 is the sheriff has a sense of comity and working with the 17 City of Victoria, which he should, but, the bottom line is, 18 the sheriff could have enforced the gambling laws at any 19 time. 20 So that's the object here, if it's happening 21 anywhere in a county, then all of the bingo in that county is 22 free from the prize fees and it would go directly to the 23 general fund of the charities. 24 MS. GREEN: Okay. 25 MR. BRESNEN: We appreciate you all's 0058 1 consideration for that concept. And there is a -- there is a 2 bill that will be filed with a new bill number shortly. 3 Okay. Thank you, all. 4 MR. BOURGOYNE: I believe we all already 5 support your bill that would put it back on the election 6 ballot. 7 MR. BRESNEN: Yes, sir. 8 MS. ROGERS: Do we know when these will be 9 ordered? 10 MR. BRESNEN: Pardon? 11 MS. ROGERS: The bills, when they will be 12 heard or -- 13 MR. BRESNEN: We don't -- we don't even know 14 who the committees are, yet. You all want a quick -- I'll 15 segue to just a real brief -- so the Legislature just got 16 sworn in on Tuesday -- 17 MS. ROGERS: Yes, sir. 18 MR. BRESNEN: -- new Speaker of the House 19 elected, Dennis Bonnan, a long time, 24-year member of the 20 House, the Lieutenant Governor, of course, was reelected, the 21 new Senator is sworn. There's six new Senators and I think 22 30-some-odd new House members, so there's a lot, they just 23 inducted their rules in the house yesterday to what the 24 committees will be and what the jurisdiction would be. 25 The gambling jurisdiction stayed with the 0059 1 licensing and administrative procedures committee. So I 2 would assume that our bill would get -- our bills would get 3 referred to the same committee, but we'll have a different 4 chair -- well, we may have a different composition of the 5 committee. So it'll be a while before they -- before they 6 get cranked up. 7 MS. ROGERS: You'll keep us aware of what's 8 going on? 9 MR. BRESNEN: I'll do my best. 10 MS. ROGERS: All right. Thank you. 11 MR. BRESNEN: Okay. Thank you, all. Any 12 other questions of me? 13 MR. DUNCAN: No, sir. 14 MR. BRESNEN: Thank you, all. Appreciate your 15 support. 16 CHAIRMAN SMITH: Okay. All right. Any other 17 discussions on Item Number 11? Okay. 18 MR. BOURGOYNE: Well, did we skip -- 19 CHAIRMAN SMITH: Yeah, we -- yes, sir. 20 MR. BRESNEN: If -- if it's appropriate and 21 the BAC would endorse the concept, we'd very much appreciate 22 it. 23 CHAIRMAN SMITH: Okay. All right. Then -- 24 MR. BOURGOYNE: This go under the same rule 25 where we -- 0060 1 CHAIRMAN SMITH: Yeah. 2 MR. BOURGOYNE: -- wait for the next meeting 3 when we vote on it? 4 CHAIRMAN SMITH: Or we waive the ten-day 5 requirement. 6 MR. DUNCAN: I thought we already did agree to 7 all this last time. 8 CHAIRMAN SMITH: I think we did. 9 MS. ROGERS: At the last commissioners 10 meeting, your reports -- 11 MR. BOURGOYNE: Yes. 12 MR. BRESNEN: Didn't we already agree? We got 13 like four items, was that one of them? 14 CHAIRMAN SMITH: Yes. 15 MR. BRESNEN: Well, I don't think this was 16 one of them. I may be -- I may be mistaken. When's your 17 next meeting? 18 CHAIRMAN SMITH: It's going to be in April. 19 MR. BRESNEN: Okay. Well, it would be helpful 20 if we could do it before that, but you've adopted a procedure 21 that I -- I'll leave it to you all whether you want to, you 22 know, live with it for this meeting or not. 23 CHAIRMAN SMITH: Okay. 24 MR. BRESNEN: But it'll be helpful, I assure 25 you, to have your support. 0061 1 CHAIRMAN SMITH: Okay. 2 MR. BRESNEN: Thanks. 3 CHAIRMAN SMITH: I think this was one of the 4 reasons that I was talking about that two-thirds deal, to do 5 something right then. 6 MS. ROGERS: That's why we probably shouldn't 7 have adopted the rule. 8 CHAIRMAN SMITH: Pardon? 9 MS. HALE: I said, that's probably why you 10 shouldn't have adopted the rule. 11 CHAIRMAN SMITH: Which one? 12 MR. DUNCAN: We didn't -- we didn't adopt that 13 two-third's rule. 14 CHAIRMAN SMITH: Yeah, we didn't -- we didn't 15 do that. 16 MS. HALE: I mean, waiting until the next 17 meeting, because you're putting us in a bind now. 18 UNIDENTIFIED VOICE: Could you state your name 19 for the court reporter? 20 MS. HALE: Angela Hale. 21 CHAIRMAN SMITH: Okay. 22 MR. MARTIN: Maybe we should have ten-days' 23 notice. 24 CHAIRMAN SMITH: If you want to make a motion. 25 MR. BOURGOYNE: I think this will be a little 0062 1 bit similar to the one that we already voted to support, 2 where they have to opt in for the tax again, it's very 3 similar. 4 CHAIRMAN SMITH: Right. 5 MR. BOURGOYNE: The same -- same issues are 6 involved, except it's a different way to go about it. So for 7 that reason, I would make a motion that we support this 8 legislation as well. 9 MS. ROGERS: And I will second that motion and 10 put in my two cents. Mr. Bresnen educated us on all of this 11 at the last meeting, which was way more than ten days ago. 12 CHAIRMAN SMITH: Yes. 13 MS. ROGERS: So I second that motion. 14 Absolutely. 15 MR. DUNCAN: Yeah, I think it was, too. 16 CHAIRMAN SMITH: Okay. All right. So are we 17 in agreement that it's already been voted to be supported on 18 -- or it's already been supported, or are you wanting a new 19 vote? 20 MR. DUNCAN: I'm pretty sure that it's already 21 been supported and then we don't have to worry about a vote. 22 MR. BOURGOYNE: The concept has been 23 supported. 24 MS. ROGERS: It's been supported and I'd be 25 happy to include it in the notes when you provide it to the 0063 1 Commission. 2 CHAIRMAN SMITH: Excellent. 3 UNIDENTIFIED VOICE: Thank you all very much. 4 CHAIRMAN SMITH: You bet. 5 MR. FARRELL: The highlights from the November 6 15th meeting -- this is Michael Farrell. The highlights from 7 the November 15th meeting, you discussed local government 8 prize fees, that was, from your notes, was require local 9 governments to currently receive a portion of the prize fee 10 to opt in to continue to receive that money, otherwise, money 11 goes to the charity. Let's see. 12 MR. DUNCAN: It was actually a meeting before 13 that. 14 CHAIRMAN SMITH: Yeah. 15 MR. FARRELL: This is the highlights of the 16 November 15th meeting, that -- it's the latest one I can pull 17 up on my phone here. 18 CHAIRMAN SMITH: Yeah. 19 MR. FARRELL: So that is -- you did discuss 20 that. 21 MR. DUNCAN: I know we talked about the issue, 22 I'm just not sure if we voted on it or not. So I know the 23 issue -- 24 CHAIRMAN SMITH: I believe we did. Yeah, I 25 think so. 0064 1 MR. BRESNEN: No, I'm not talking about the 2 local option, I'm talking about this one about the illegal 3 gaming deal. I know you've heard about it before and I don't 4 think I'm springing anything new on you, but I'm not sure 5 that you voted on it. 6 CHAIRMAN SMITH: Okay. 7 MR. BRESNEN: It's up to you all. If your 8 minutes today reflect that that was the decision of the BAC 9 from the prior meeting, I think we're good to go. I would 10 just like to be able to say the BAC supports it. 11 CHAIRMAN SMITH: I think that's a fair 12 statement. 13 MR. DUNCAN: Yes. I think we've kind of -- 14 CHAIRMAN SMITH: Yeah, I think we did, too. 15 MR. BRESNEN: That's all I need. 16 CHAIRMAN SMITH: Okay. All right. We did 17 skip item number ten, accidentally. I don't know how we did 18 that, but we did it. 19 AGENDA ITEM X 20 CHAIRMAN SMITH: Discussion and possible 21 action on pull-tab rules. Emile, do you have anything on 22 that? 23 MR. BOURGOYNE: Yeah, this was the one where 24 we brought the last time to try to amend section 402-300E, 25 sales and redemption, where we only report the pull-tab bingo 0065 1 tickets sold once the deal is withdrawn from play. And the 2 reason we're trying to do this, both the manufacturers of 3 vending machines believe that this would give an opportunity 4 for charities to use more vending machines and sell more 5 instant tickets. 6 And the way we see this happening is there's 7 two -- as I understand it, there's perpetual inventory 8 records and there's daily sales records. The daily sales 9 records from these instant sales that go from session to 10 session to session would be kept in-house and not reported. 11 The cash would be kept and the daily sales record would be 12 kept, but once the deal is withdrawn from play, then that 13 daily sales record would show the entire deals, transactions, 14 and the cash would be reported at that point in time. 15 I had asked Michael to get with his auditing 16 staff to see if the had any other issues or any other 17 recommendations on how that would be happening and -- 18 MR. FARRELL: I don't have any. 19 MR. BOURGOYNE: Okay. That's my understanding 20 is that there's two -- right now there's two sets of checks 21 and balances and those cash sales, if they weren't deposited 22 or reported for that daily session, could still be tracked 23 through the perpetual inventory records. And I've got some 24 support from both the vending manufactures and all paper 25 pull-tab manufacturers that believe this would help the sale 0066 1 of instant tickets, because they're afraid that if I've got 2 to report the same deal in three, four, or five sessions, 3 then you multiply the number of sessions I got and then 4 they'll -- but for the number of facilities I have, there's 5 so many opportunities for a mistake in that daily reporting 6 where if you do it just one session when it's closed, you 7 report the whole deal at that point. 8 MS. ROGERS: And you wouldn't do -- you 9 wouldn't report it until it's withdrawn, until it's done? 10 MR. BOURGOYNE: Until it's sold out or 11 withdrawn from play for good. That's the session that the 12 instant ticket would need to be reported. It's not an issue 13 with events because they're sold and done in the one session. 14 MS. ROGERS: And -- 15 MR. BOURGOYNE: I'm sorry. Go ahead. 16 MS. ROGERS: And you're talking about instants 17 in a machine or instants sold in a pull-tab counter or 18 anything? 19 MR. BOURGOYNE: Any instant ticket that goes 20 from session to session. 21 MS. ROGERS: Okay. 22 MR. BOURGOYNE: Because their ticket counts 23 could be extremely large. 24 CHAIRMAN SMITH: So what happens to the money 25 every day? It gets deposited or held out? 0067 1 MR. BOURGOYNE: It gets -- it gets held, 2 wherever you deposit the money, wherever they safe keep their 3 money now, most of these facilities have -- they deal with 4 thousands of dollars, hundreds of thousands of dollars, some 5 of them, a day, it just doesn't go into the state report. 6 They could put it in the bank, as long as you keep your daily 7 sales records on site so that if something was to question 8 about where that money came from. And then when the deal is 9 withdrawn from the play, all that money is reported and all 10 that ticket activity is reported on that session. 11 CHAIRMAN SMITH: Okay. But you're still 12 waiting on some feedback from Michael and his staff? Is that 13 right? 14 MR. BOURGOYNE: I don't know if there is any 15 coming. 16 MR. FARRELL: I don't have any feedback. 17 MR. BOURGOYNE: Yeah. 18 CHAIRMAN SMITH: Okay. Okay. 19 MR. BOURGOYNE: We'd just like to see -- 20 recommend that rule be changed to allow that and if they need 21 to draw up procedures for an auditing staff, they can do so. 22 CHAIRMAN SMITH: Okay. 23 MR. BOURGOYNE: That's how we see it 24 happening. 25 CHAIRMAN SMITH: Okay. Any other comments on 0068 1 this? Any from the public? 2 MR. FENOGLIO: This is Steve FENOGLIO. Is 3 there specific language that you -- that the -- that the 4 group has on the rule? 5 MR. BOURGOYNE: Yes. 6 MR. FENOGLIO: If so, I'd like to see it. 7 MR. BOURGOYNE: It was on the agenda at the 8 last meeting. 9 MR. FARRELL: Okay. Okay. No, Emile, let me 10 add that I have not seen the specifics of it. The devil is 11 in the details on some of this, too. So if I can get a copy, 12 if you can send it. 13 MR. BOURGOYNE: I'll give you another copy. 14 MR. FARRELL: Yeah, send me another copy and 15 I'll -- 16 MR. BOURGOYNE: Okay. 17 MR. FARRELL: -- make sure -- 18 CHAIRMAN SMITH: Okay. All right. Anything 19 else on pull-tab rules? Okay. 20 AGENDA ITEM XII 21 CHAIRMAN SMITH: All right. Item number 12, 22 any old business? Anything we need to discuss that we 23 haven't discussed yet? 24 AGENDA ITEM XIII 25 CHAIRMAN SMITH: Any new business? All right. 0069 1 AGENDA ITEM XIV 2 CHAIRMAN SMITH: Item number 14, set the date 3 for the next meeting. Looking at April -- 4 MS. ROGERS: We've got Easter somewhere. 5 CHAIRMAN SMITH: Pardon? 6 MS. ROGERS: We have Easter somewhere. 7 CHAIRMAN SMITH: Yeah, Easter's on the -- 8 MS. ROGERS: That's like a Sunday. 9 CHAIRMAN SMITH: Yeah, but the -- the Good 10 Friday is on the 19th. 11 MS. ROGERS: Okay. 12 CHAIRMAN SMITH: So maybe the 4th or the 25th? 13 MR. FARRELL: Is -- I'm only throwing this 14 out, is there a bingo day at the capital? 15 CHAIRMAN SMITH: Yes, there is. That's on the 16 9th. Are we bound to have it on a Thursday, Michael? 17 MR. FARRELL: No. We can -- we can look at 18 the calendar and see what day's available. 19 CHAIRMAN SMITH: Okay. 20 MS. ROGERS: Do we need it earlier? Is that 21 why -- there's no meeting in February, could we not meet 22 until May? 23 MR. FARRELL: April. 24 MS. ROGERS: April -- 25 CHAIRMAN SMITH: April. 0070 1 MR. FARRELL: Meet every other month. 2 MS. ROGERS: Okay. 3 MR. FARRELL: Be careful with March, Trace. 4 You'll have South By Southwest here. Is it -- 5 CHAIRMAN SMITH: Well, what I was thinking, is 6 we do -- TCA does have charity day at the capital on the 9th 7 -- 8 MS. ROGERS: Okay. 9 CHAIRMAN SMITH: -- maybe we have it the 8th, 10 the day before? 11 MS. ROGERS: Aren't we supposed to be meeting 12 in March? Every other month, right? 13 CHAIRMAN SMITH: No, we meet quarterly. 14 MS. ROGERS: Then we can't meet before the 15 commissions, then we'd have to wait until -- yeah, because if 16 not, you're going to throw yourself behind -- 17 CHAIRMAN SMITH: Okay. 18 MS. ROGERS: -- the commissioners. Does 19 anyone know when South By Southwest is? 20 MR. FARRELL: It's like the second or third 21 week in March. 22 MS. ROGERS: I'd like to stay in San Antonio. 23 And then there's Spring Break. 24 CHAIRMAN SMITH: What about -- the 25 commissioner's meeting is when? The 4th? What if we did it 0071 1 the 8th, we'd be after the commission meeting, right? 2 MS. ROGERS: If we do it the 8th, we're after 3 the commissioners meeting. 4 CHAIRMAN SMITH: Right. 5 MS. ROGERS: So you wouldn't give your report 6 to them until -- 7 UNIDENTIFIED VOICE: It's the 8th through 17th 8 is South By. 9 MR. FARRELL: Okay. Wait a second. The 8th 10 to the 17th of March is South By. 11 CHAIRMAN SMITH: Okay. 12 MR. FARRELL: Okay. You would, at the next 13 commission meeting, you would be providing a report from this 14 meeting. 15 CHAIRMAN SMITH: Right. 16 MS. ROGERS: Oh, okay. 17 CHAIRMAN SMITH: Right. See what I'm saying? 18 MR. FARRELL: So -- so it's -- 19 CHAIRMAN SMITH: What we could do -- 20 MR. FARRELL: What you do, you provide what's 21 between -- 22 MS. ROGERS: That's the one in February? 23 MR. FARRELL: It's February, right. And you 24 -- there's no requirement -- 25 MR. DUNCAN: Either on the 21st or the 28th of 0072 1 March, if you want to do it before the commissioners meeting. 2 MS. ROGERS: 21st is fine with me if you're 3 going to get to spring break before, which is South By 4 Southwest. I'm fine with the 21st. 5 CHAIRMAN SMITH: Okay. 6 MR. DUNCAN: What is today? 7 MS. ROGERS: The 21st. 8 MR. DUNCAN: The 21st of -- 9 CHAIRMAN SMITH: Tommy, you good with that, 10 March 21st? 11 MR. DUNCAN: Yeah. 10:00 a.m.? 12 CHAIRMAN SMITH: 10:00 a.m., yes, sir. 13 MR. DUNCAN: I'll probably be out of the 14 country. 15 MS. ROGERS: Can we go with you? 16 MR. MARTIN: What about the 28th? Oh, you all 17 already got along? 18 MS. GREEN: Yeah, pick your -- pick your day, 19 I'll just look at the dates. 20 MR. BOURGOYNE: Twenty-first? 21 CHAIRMAN SMITH: Yeah. 22 MR. BOURGOYNE: Twenty-first? 23 CHAIRMAN SMITH: Yeah, the 21st of March for 24 the next meeting. You good with that, Will? 25 MR. MARTIN: Yeah. 0073 1 CHAIRMAN SMITH: Tommy? Michael, you okay 2 with that? 3 MR. FARRELL: Right now. 4 CHAIRMAN SMITH: Right now. 5 MR. FARRELL: I have to take availability of 6 the room. 7 CHAIRMAN SMITH: Right. Okay. Well, if we 8 need to move it, we can move it to suit you. Okay. All 9 right. Next meeting for BAC is the 21st of March, 10:00 a.m. 10 UNIDENTIFIED VOICE: When's the next Lottery 11 Commission meeting? 12 CHAIRMAN SMITH: February the 7th. 13 MS. GREEN: Trace? 14 CHAIRMAN SMITH: Pardon? 15 MS. GREEN: I'm going to be gone. 16 CHAIRMAN SMITH: You will be gone that day? 17 MS. GREEN: I believe -- 18 CHAIRMAN SMITH: Okay. 19 MS. GREEN: Yeah, I leave the 18th. 20 CHAIRMAN SMITH: All right. Well, safe 21 travels. 22 AGENDA ITEM XV 23 CHAIRMAN SMITH: Okay. All right. Any other 24 business real quick? Okay. We will adjourn this meeting at 25 11:19. 0074 1 MR. BOURGOYNE: I second. 2 CHAIRMAN SMITH: Thank you all for coming. 3 (Meeting adjourned at 11:19 a.m.) 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 0075 1 C E R T I F I C A T E 2 STATE OF TEXAS ) 3 COUNTY OF HARRIS ) 4 I, Kimberly C. McCright, Certified Vendor and 5 Notary in and for the State of Texas, do hereby certify that 6 the above-mentioned matter occurred as hereinbefore set out. 7 I FURTHER CERTIFY THAT the proceedings of such were 8 reported by me or under my supervision, later reduced to 9 typewritten form under my supervision and control and that 10 the foregoing pages are a full, true and correct 11 transcription of the original notes. 12 IN WITNESS WHEREOF, I have hereunto set my hand and 13 seal this 22nd day of January, 2019. 14 15 /s/ Kimberly C. McCright Kimberly C. McCright 16 Certified Vendor and Notary Public 17 Verbatim Reporting & Transcription, LLC 1322 Space Park Drive, Suite C165 18 Houston, Texas 77058 281.724.8600 19 20 21 22 23 24 25