C.S.H.B. 1241 78(R)    BILL ANALYSIS


C.S.H.B. 1241
By: Homer
Licensing & Administrative Procedures
Committee Report (Substituted)



BACKGROUND AND PURPOSE 

Currently a retailer bears the risk of loss for all lottery tickets
received.  In the case of stolen tickets in a confirmed status "with
validations," the retailer is charged the full amount of the pack, less
the commission. 

CSHB 1241 addresses this concern by adding to the list of criteria for
which bond or insurance can be purchased. The list of criteria for which
bond or insurance can be added also includes bankruptcy, theft, or loss of
lottery tickets,  supplies or equipment to the Act. 


RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any
additional rulemaking authority to a state officer, department, agency, or
institution. 

ANALYSIS

Amends Section 466.156, Government Code by adding "and" to include other
types of criteria for which bond, insurance can be added. The substitute
also adds loss of sales agent due to bankruptcy, theft, or loss of lottery
tickets, supplies, or equipment to the section. The section also adds that
all losses to the state resulting from the agent's loss must be paid by
the bond fund and the executive director is prohibited from charging an
agent for a loss reimbursed from the bond fund. 

According to Section 466.156(b) a sales agent who has not complied with
the requirements in subsection (a), may be required to maintain insurance
to protect the state's interests. 


EFFECTIVE DATE

September 1, 2003.


COMPARISON OF ORIGINAL TO SUBSTITUTE

The substitute amends  the caption to conform with changes made to the
original bill. 

The substitute removes Section 466.026, Government Code that required the
Texas Lottery Commission to purchase and provide insurance coverage to
sales agent and lottery vendors and replaces it with Section 466.156 (a)
and (b), Government Code which  simply adds losses of a sales agent due to
bankruptcy, theft, or loss of lottery tickets, supplies, or equipment to
an existing statute to provide bond or insurance to lottery agents and
states that a sales agent loss must be paid from the bond fund and the
agent may not be charged for a loss reimbursed from the bond fund. The
substitute also authorizes a sales agent to maintain insurance if the
sales agent has not complied with  the requirements of subsection (a).  

The substitute also removes SECTION 2 to require the Texas Lottery
Commission to adopt rules and procedures to provide insurance coverage and
renumbers the effective date  from SECTION 3 of the original bill to
SECTION 2.