| (a) Bond or Other Security Required.
(1) An applicant for a regular license to conduct charitable
bingo must submit security consistent with the provisions of this
section. A licensed authorized organization must maintain the security
until the organization ceases to conduct bingo and the license is
relinquished or revoked.
(A) Except as otherwise provided in this section, the
security amount for a regular license to conduct charitable bingo
is based on the license class. The security amount is:
(i) Class A - $125.00.
(ii) Class B - $325.00.
(iii) Class C - $600.00.
(iv) Class D - $825.00.
(v) Class E - $1,225.00.
(vi) Class F - $1,800.00.
(vii) Class G - $2,125.00.
(viii) Class H - $2,675.00.
(ix) Class I - $3,275.00.
(x) Class J - $7,000.00
(B) If at any time a licensed authorized organization
fails to fully pay its requisite prize fees by the due date and a
jeopardy determination becomes final, then the organization's security
amount may be calculated at three times its highest quarterly prize
fee for the four most recent quarters or for the highest quarter filed
if less than four.
(C) If a licensed authorized organization has fully
paid all prize fees and associated penalties, if any, prior to a final
jeopardy determination for eight (8) consecutive quarters, the amount
of the requisite security will be reduced to $100.00. If at any time
an organization paying the reduced security amount fails to fully
pay its requisite prize fees and any associated penalties and interest
by the due date and a jeopardy determination becomes final, then the
Commission may calculate the organization's security amount in accordance
with §402.603(a)(1)(A) or (B) of this chapter.
(2) An applicant for a manufacturer's license must
submit a cash bond or bond in the amount of $10,000 issued by a surety
company chartered or authorized to do business in this state. A licensed
manufacturer must maintain the bond until the license is relinquished
or revoked.
(3) Accounting Units.
(A) An accounting unit may submit and maintain one
bond or other security to cover each of the unit's member organizations.
Except as otherwise provided in this section, the amount of the security
shall be the aggregate of each unit member organization's security
amount, as set in §402.603(a)(1) of this chapter. If a unit member
organization subsequently withdraws or is removed from the unit, that
organization is responsible for obtaining and maintaining the requisite
security.
(B) If at any time an accounting unit fails to fully
pay its requisite prize fees by the due date and a jeopardy determination
becomes final, the unit's security amount may be calculated at three
times the unit's highest quarterly prize fee liability for the four
most recent quarters or for the highest quarter filed if less than
four. The financial obligation for such security shall be divided
equally among the organizations that were in the unit at the time
of the prize fee delinquency. If a unit member organization withdraws
or is removed from such a unit, that organization's security amount
shall be equivalent to its share of the unit's security amount, and
the unit's security amount may be reduced by an amount equivalent
to the exiting organization's share. If another organization subsequently
joins such a unit, the unit's security amount will increase by the
amount of the newly-joined organization's security amount.
(b) Types of bonds or other security. The Commission
will accept only the following types of bonds or other security as
security for the payment of prize fees:
(1) Cash or check made payable to the state comptroller.
Cash security will not earn interest for the licensee.
(2) Irrevocable assignments of accounts, including
certificates of deposit or certificates of savings, in banks, savings
and loan institutions, and credit unions, whose deposits are insured
by an agency of the United States government. This security must be
executed on an assignment form approved by the Commission.
(3) Letters of credit from financial institutions.
(4) United States Treasury bonds, readily convertible
to cash.
(5) Surety bonds executed on a form approved by the
Commission and issued only by a surety company chartered or authorized
to do business in the State of Texas. The appointing instrument must
be properly notarized and physically attached to the bond.
(c) Forfeiture.
(1) If a licensed authorized organization or accounting
unit pays less than the total amount of prize fee due, the Commission
shall notify the licensed authorized organization or accounting unit
of the delinquency via the "Texas Notice of Fee Due and Jeopardy Determination"
for the quarter in which the liability exists.
(2) If the licensed authorized organization or accounting
unit does not make the required payment by the date stated in the
notice provided under subsection (c)(1), the Commission will demand
the bond or other security or any part of the bond or other security
from the holder of the bond or other security necessary to pay the
amount of prize fee due.
(3) The Commission will notify the licensed authorized
organization or accounting unit and demand that a new or additional
bond or other security for the specified amount be furnished within
20 days of the date of such notice. Failure to comply with the requirements
of the notice within the 20 day period will result in the denial of
an application for renewal or revocation of the license.
(d) Release of Bond or Other Security. The Commission
will release a bond or other security upon the relinquishment or revocation
of the license for which the security was furnished, provided that
the Commission determines that no prize fee, penalty, or interest
remains due and payable. The Commission will notify the former licensee
in writing that the security has been released. If an accounting unit
maintains one bond or other security for its member organizations,
and one or more of the unit member's licenses are relinquished or
revoked, then the Commission will notify the accounting unit in writing
that its security amount may be reduced to an amount sufficient to
cover only current unit members.
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| Source Note: The provisions of this §402.603 adopted to be effective May 10, 2007, 32 TexReg 2467; amended to be effective August 1, 2016, 41 TexReg 5505; amended to be effective December 31, 2017, 42 TexReg 7392 |
