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Ordinance Number: 1011
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CIBOLO
TEXAS AMENDING THE CODE OF ORDINANCES, CHAPTER 18
(BUSINESSES), BY ADDING SECTION V, COIN-OPERATED
AMUSEMENT MACHINES, LEVYING AN OCCUPATIONS TAX,
REQUIRING A LICENSE FEE; PROVIDING FOR THE REGULATION
OF COIN OPERATED DEVICES; PROVIDING EXCEPTIONS TO THE
ORDINANCE; AND PROVIDING PENALTIES FOR VIOLATIONS OF
THE ORDINANCE.
WHEREAS, the Texas Local Government Code section 215.074 allows a home-rule
municipality to regulate the location and conduct of places of public amusement; and
WHEREAS, the Texas Local Government Code Section 215.075 provides for a municipality to
license any lawful business or occupation that is subject to the police power of the municipality;
and
WHEREAS, the Texas Occupations Code Section 2153.45.1 provides that a municipality may
impose an occupation tax on a coin-operated machine in this state; and
WHEREAS, the Texas Occupations Code Section 2153.452 provides that a municipality may
restrict the exhibition of a coin-operated amusement machine within 300 feet of a church, school,
or hospital; and
WHEREAS, the Texas Occupations Code Section 2153.453 provides that a municipality that
imposes an occupation tax on a coin-operated machine may seal a coin-operated machine if the
tax imposed is not paid and charge a fee for the release of a sealed coin-operated machine; and
WHEREAS, the City Council wishes to adopt Article V, Chapter 18 to levy an occupations tax
and regulate the use of coin-operated amusement machines.
NOW THEREFORE BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
CIBOLO,TEXAS:
Section 1.That Chapter 18 of the Code of Ordinances is amended by adding a new Article V to
read as follows:
ARTICLE V.
COIN-OPERATED AMUSEMENT MACHINES
Sec. 18-400-Definitions. In this article:
Amusement redemption machine means:
a. A skill or pleasure coin-operated machine that is designed,made and adapted solely for bona
fide amusement purposes, and that by operation of chance or a combination of skill and
chance, affords the user, in addition to any right of replay, an opportunity to receive
exclusively non-cash merchandise prizes,toys,novelties, or a representation of value
redeemable for those items;
b. Any electronic, electromechanical, or mechanical contrivance designed,made and adapted
solely for bona fide amusement purposes if the contrivance rewards the player exclusively
with non-cash merchandise,prizes, or novelties, or a representation of value redeemable for
those items,that have a wholesale value available from a single play of the game or device of
not more than ten times the amount charged to play the game or device once or$5.00,
whichever is less.
Amusement redemption machine game room means any establishment where five or more
amusement redemption machines,with the exception of excluded machines, are displayed or
exhibited for public use.
Coin-operated machine means and includes every machine or device of any kind or character
which is operated by or with coins,metal,slugs,tokens, or checks. Music coin-operated machines
and skill or pleasure coin-operated machines, as defined in this section, shall be included in such
term.
Excluded machines. An amusement redemption machine game room does not include:
a. A machine that awards the user non-cash merchandise prizes,toys, or novelties, solely and
direct from the machine, including claw, crane, or similar machines; nor
b. A machine from which the opportunity to receive non-cash merchandise prizes,toys, or
novelties, or a representation of value redeemable for those items,varies depending upon
the user's ability to throw,roll, flip,toss,hit, or drop a ball or other physical object into the
machine or a part thereof,including basketball, skeet ball, golf,bowling,pusher, or similar
machines; nor
c.A machine or any device defined in section 47.01,Penal Code, as a gambling device, or any
activity prohibited or described in chapter 47,Penal Code.
Music coin-operated machine means and includes every coin-operated machine of any kind or
character which dispenses or vends or which is used for dispensing or vending music and which
is operated by or with coins,metal slugs,tokens or checks. The following are expressly included
within this term: phonographs,pianos, graphophones, and all other coin-operated machines
which dispense or vend music.
Operator means and includes any person who exhibits, displays, or permits to be exhibited or
displayed, in a place of business other than his own, any coin-operated machine in this city.
Owner means and includes any person owning or having the care, control,management, or
possession of any coin-operated machine in this city.
Representation of value means cash paid under authority of sweepstakes contests as provided in
the Texas Business and Commerce Code, chapter 43(B), or a gift certificate or gift card that is
presented to a merchant in exchange for merchandise.
Service coin-operated machine means every pay toilet,pay telephone, and all other machines or
devices which dispense service only and not merchandise,music, skill, or pleasure.
Skill or pleasure coin-operated machine means and includes every coin-operated machine, of
any kind or character whatsoever,when the machines dispense or are used or are capable of
being used or operated for amusement or pleasure, or when the machines are operated for the
purpose of dispensing or affording skill or pleasure, or for any other purpose other than the
dispensing or vending of merchandise or music or service exclusively as those terms are defined
in this section. The following are expressly included within this term: marble machines,marble
table machines,marble shooting machines,miniature racetrack machines,miniature football
machines,miniature golf machines,miniature bowling machines, and all other coin-operated
machines which dispense or afford skill or pleasure. Every machine or device of any kind or
character which dispenses or vends merchandise, commodities or confections, or plays music in
connection with or in addition to these games or dispensing of skill or pleasure shall be
considered as skill or pleasure machines and taxed at the higher rate fixed to these machines.
Sec. 18-401 - Occupation tax levied.
(a) Every person who owns, controls, exhibits, displays, or permits to be exhibited or displayed
in this city any coin-operated machines shall pay, and there is hereby levied on every coin-
operated machine except such as are exempted in this article, an annual occupation tax of one-
fourth the tax charged and collected by the state.
(b)Nothing in this section shall prevent the operator of the machines from paying the tax levied
in this section for the account of the owner,but the payment of the tax by the operator or
other person shall not relieve the owner from the responsibility of complying with all
provisions of this article.
Sec. 18.402-Payment of occupation tax; receipt to be attached to machine.
(a)The occupation tax levied by this article shall be paid to the city,who shall issue an
occupation tax receipt.
(b)The occupation tax receipt shall be attached to the coin-operated machine mentioned in the
receipt and shall bear the serial number of the particular machine.
(c) It shall be unlawful for any person to operate, exhibit, or display any coin-operated machine
in the city without having attached thereto an occupation tax receipt, and no occupation tax
receipt issued for a certain coin-operated machine shall be transferred to any other machine.
Sec. 18-403 -Exemptions.
Utility meters,pay telephones,pay toilets, food vending machines, confection vending machines,
beverage vending machines,merchandise vending machines, and cigarette vending machines
which are subject to an occupation or gross receipts tax and service coin-operated machines are
expressly exempt from the tax levied in this article and the other provisions of this article.
Sec. 18-404-Illegal machines not authorized.
Nothing in this article shall be construed or have the effect to license,permit, authorize, or
legalize any machine, device,table, or coin-operated machine,the keeping, exhibition, operation,
display or maintenance of which is illegal or in violation of any article of the Penal Code of this
state or the constitution of this state.
Sec. 18-405- Skill or pleasure coin-operated machines prohibited near schools.
No skill or pleasure coin-operated machine shall be exhibited within 300 feet of any church,
school, or hospital.
Sec. 18-406.-Amusement redemption machines and game rooms.
(a)Licensing and permitting.
(1)License. No person shall operate an amusement redemption machine game room in the
city without first obtaining a license from the chief of police, as required by this
section.No license shall be issued until the occupation tax has been paid by the
operator for each machine within the premises, as required by section 18-402.
(2)Permit. No person shall operate an amusement redemption machine in the city without
first obtaining a permit from the chief of police.No permit shall be issued until the
occupation tax has been paid by the operator, as required by section 18-402.
(b)Local license fee for amusement redemption machine game room required.
(1)Payment of fee and issuance of license: An owner, operator, or lessee of an
amusement redemption machine game room shall be required to secure a license
annually. An amusement redemption machine game room shall be required to secure
a license by paying to the city an annual inspection and amusement redemption
machine game room license fee as adopted in the City's Schedule of fees. Upon
payment of fee and compliance with all licensing requirements,the license shall be
issued by the chief of police, or designee.
(2)Application: An applicant for a license or permit shall file with the chief of police a
written application on a form provided for that purpose,which shall be signed by the applicant,
who shall be the owner, operator, or lessee of the amusement redemption machine game room.
Should an applicant maintain an amusement redemption machine game room at more than one
location, a separate application must be filed for each location. The following information is
required in the application:
a.Name, address, telephone number and driver's license number of the applicant if a natural
person;name, address,telephone number and driver's license number of all persons who own
25 percent or more interest in the amusement redemption machine game room;name, address,
telephone number and driver's license number of all corporate officers, if any, of the such
business; name, address, telephone number of the business; if incorporated,the name of the
business registered with the secretary of state; if a partnership,the name, address,telephone
number and driver's license of each of the general and limited partners; a copy of the
applicant's d/b/a,if applicable. If applicant is not the owner of the premises,the applicant shall
furnish the name, address, and telephone number of the property owner.
b. The previous occupation(s) of the applicant and,if applicable, all corporate officers and
partners of the applicant within the preceding five years;
c. Whether a previous license or permit of applicant, or,if applicable, corporate or partner of
applicant,has been revoked within two years of filing of the application;
d.Number of amusement redemption machines in the amusement redemption machine game
room;
e. A statement that:
1. The amusement redemption machines are not and will not be used as gambling
devices;
2. That all the facts contained in the application are true and correct;
3. The location and operation of the amusement redemption machine game room will not
violate any applicable deed restrictions; and
4. The amusement redemption machine game room will be operated in accordance with
all laws; and
f.Name, address, and telephone number of an emergency contact person who can be reached
after hours.
(3)Expiration and renewal:
a.Expiration. An annual amusement redemption machine game room license issued by
the city shall automatically expire on the thirty-first day of December following its
issuance, except as otherwise stated herein. Such license shall automatically expire if
the licensee thereof sells the property or the business,transfers equity to accomplish
same, or otherwise disposes of such devices. An amusement redemption machine game
room license is not assignable or transferable. The city shall not refund any portion of a
license after the license is issued,nor shall it prorate or reduce in amount any fee due to
the city.
b.Late penalty. Upon the expiration of a license,the licensee shall obtain a renewal if the
licensee wishes to continue operating an amusement redemption machine game room.
Failure to obtain the renewal within 30 days after expiration will require such person to
pay an additional late fee in an amount equal to 20 percent of the fee actually due or 20
percent of the previous year's fee,whichever is greater,in order to obtain reinstatement
of his license.Nothing herein authorizes the licensee to operate after the expiration of a
license and before a renewal is effective.
(4) Sealing: The city shall have the authority to seal any coin-operated machine located in any
amusement redemption machine game room for which a license fee has not been secured. A
$5.00 fee will be charged for the release of any machine sealed for non-payment of said license
fee.
(5)Posting of license: The license shall be conspicuously posted inside the building.
(6)Restrictions, regulations, controls, and limitations: The following restrictions,regulations,
controls, and limitations shall apply to all amusement redemption machine game rooms:
a. Condition of premises. All building and fire code standards must be met. Inspection by
building officials and certificate of occupancy shall be obtained before license is issued.
Game room must be located in an area zoned for that activity.
b. Methods of conduction of business.No alcoholic beverages shall be served or allowed
on premises. No activities allowed outdoors.
c. Hours of operation. May only be operated between the hours of 7:00 a.m. and 2:00
a.m.
d. Parking requirements. One space for each two machines,plus one space per employee
per shift.
e. Location requirements. Premises shall not operate within 300 feet of an established
church, school, day care or hospital.
f. Location requirement. Premises shall not operate within 1,500 feet of another
amusement redemption machine game room.
g. The owner, operator, or manager of the premises must be present to supervise the
operation of the machines. The machines shall not be left unattended.
h.Machines must be situated within the premises as to be in full and open public view,
which entails being visible to all patrons of the establishment.
i. Minors may not operate machines during school hours on days when school is in
session.
j. A game room operator must be a person who is at least 18 years of age.
k. Total number of machines in one establishment shall be limited to 50.
(d)Refusal or termination of license/appeal: If the chief of police refuses to approve the issuance
of a license or the renewal of a license to an applicant, or revokes a license issued to a licensee
under this chapter, such action is final unless the licensee,within ten days after the receipt of
written notice of the action, files with the city manager a written appeal. The city manager shall,
within ten days after the appeal is filed, consider all evidence in support of or against the action
appealed, and licensee may,within ten days of that decision file a written appeal with the city
clerk to the city council setting forth specific grounds for the appeal. The city council shall,
within 30 days, grant a hearing to consider the action. The city council has authority to sustain,
reverse or modify the action appealed. The decision of the city council is final. Filing of an
appeal stays the previous action of the police chief or city manager, as applicable. Failure or
refusal to renew or revocation of an amusement redemption machine game room license does not
affect operation of the principal business of which the amusement redemption machine game
room is a part. For example, establishments licensed by the Texas Alcoholic Beverage
Commission, convenience stores and restaurants may continue to operate that business but will
not be allowed to operate with the amusement redemption machines.
(e)Disclaimer. By issuing the required license, the city is not certifying the installation or use of
the amusement redemption machines applying for a license,the applicant shall acknowledge that
the city is not certifying or sanctioning the installation or use of such machines.
(f)Limitation of regulations on existing business. Those businesses operating amusement
redemption machines and game rooms permitted by the city prior to April 24, 2012 are exempt
from the regulations specified in sections 18-405, 18-406(c) (6) c., d., e., f.,h., and k. The
relocation of the business, or the closing of the business for whatever reason whether temporarily
or permanently, or the loss of or failure to renew licenses or permits required by these
regulations, or the violation of any regulation causing the closure and/or loss of license required,
make these exemptions void. These exemptions are specific and do not include any other
regulation or code that would otherwise be applicable.
Secs. 18-407-18-450-Reserved.
Section 2.That the provisions of this ordinance are severable and the invalidity of any part of
this ordinance will not affect the validity of the remainder of the ordinance.
Section 3.That any person found guilty of violating this ordinance will be fined not more than
$500.00 for each offense.Notice of the enactment of this ordinance will be given by publishing
the ordinance or its descriptive caption and pena
lty in the City's official newspaper one time within 30 days of passage.
PASSED AND APPROVED THIS 24TH DAY OF APRIL 2012.
i a n1
J 'fer H)i . s Mayor
ATTEST:
Peggy Cimics, City Secretary
Reviewed for Legal Compliance: 17,