Texas State Legislature Considers Poker Legalization and Regulation

Among the ironies most signifying the state of American political affairs regarding poker is the fact that the namesake of poker's most popular version, Texas Hold'em, is a place where only in rare instances is the game legal. Now, a newly proposed law seeks to change that.

Texas State Representative Jose Menendez (D-San Antonio) recently introduced HB 3186, defining poker as a game of skill and expanding the formats and location where the game is allowed to be played. Entitled the 'Poker Gaming Act of 2007', the bill has yet to come up for any sort of a vote. However, the measure reflects growing sentiment on the part of Texans that the current state of affairs is counterproductive to both poker players and Texas in general.

Among the highlights proposed within HB 3186:

* Poker is to be defined as a game of skill, and not a lottery (forbidden as a private enterprise under the Texas state constitution). Despite this, a newly created 'Poker Division' would still be administered by the state through its Lottery Commission;

* Up to four (4) poker tables would be allowed at any licensed poker facility, excepting applications from racetracks, which would be reviewed and granted a quantity of tables by the Lottery Commission itself. These tables could be live or electronic, with the electronic versions subject to regulatory approval;

* Charity poker events will be allowed, with licensed poker operators needing to apply for a permit for each event. The "four table" rule does not apply to charity events, which would instead be governed by a separate, extensive set of regulations;

* All management and employees involved in the operation of the room, including dealers, must be licensed by the state. Minimum licensing requirements and fees would be administered by the proposed Poker Division of the Texas Lottery Commission, with the fees ranging from $1,000 for a commercial or charitable operator's license down to $100 for a dealer's license. Non-profit organizations could apply for a special $100 license to run games as well;

* Poker licenses are renewable on an annual basis. Temporary licenses good for six months may be issued at or after the time of application, as part of the initial determination of suitability;

* A licensed site can serve alcohol (and in fact, a valid commercial alcohol license is a mandatory part of the process for any applicant possessing one). However, a locale serving alcohol must shut down the poker games at the 'bar time' dictated by law, while rooms not serving alcohol would not be restricted in this way;

* Poker tournaments would be allowed, with a maximum buy-in-plus registration-fee of $100+30;

* Cash games would be raked in a manner similar other live rooms, with a 10% maximum and a $4 cap on any given hand. Promotion fees (such as, perhaps, bad-beat jackpots), would also be allowed, with a maximum contribution of $1 per hand.

A sizeable chunk of the proposed measure is devoted to auditing, regulatory requirements, and penalties assessed for violations by operators and players alike. Rep. Menendez has yet to issue a comment or press release on the proposed legislation, but one interested organization, the Texas Poker PAC [Political Action Committee], was quick to trumpet the bill's introduction. According to TPPAC treasurer Mike Lavigne, "This legislation could raise over a billion dollars over the next biennium for state coffers while bringing the game out of legal limbo and into the light."

Despite that, the bill faces several hurdles on its path. HB 3186's introduction came, coincidentally, at the same time as bills proposing Texas casinos and video slot machines made the news. On that front, the introduction of full-scale casinos would require a state-constitution amendment and could only come about through a voter referendum on the matter.

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