Can the Texas Legislature legalize casino gambling without amending the state constitution?

Texas AG Opinion JM-1267: Can Texas Legalize Casino Games Without a Constitutional Amendment?

Plain-English summary

Texas has long banned "lotteries and gift enterprises" in its constitution, and Chapter 47 of the Penal Code makes most gambling a crime. Representative Terral Smith, then chairman of the House Natural Resources Committee, asked the Attorney General whether the Legislature could open the door to casino gambling just by changing the Penal Code, or whether that would first require a constitutional amendment. He asked in three parts: about games like roulette, dice, and slot machines (question 1); about games like poker, blackjack, and sports pools (question 2); and about allowing casino gambling only on Port Arthur's Pleasure Island (question 3).

The constitutional provision is Article III, section 47, which directs the Legislature to pass laws prohibiting lotteries and gift enterprises (with later exceptions for charitable bingo and raffles). The key point the opinion drew out is that section 47 does not ban all gambling; it bans lotteries. The Texas courts define a lottery by three elements that must all be present: (1) a prize, (2) awarded by chance, and (3) paid for with consideration (money or something of value). If a game is missing any of those three elements, it is not a constitutional lottery, and the Legislature can legalize it by ordinary statute without amending the constitution.

That framing controlled the answer. The consideration element and the prize element would obviously be present in casino games, so everything turned on the chance element. A game is a lottery only if chance, rather than skill, is the dominating element of the whole scheme. If skill predominates and permeates the game, it is not a lottery, even though a prize is offered. So the Legislature may amend Chapter 47 of the Penal Code to authorize any gaming activity that does not amount to a lottery, that is, any game not built on all three elements of prize, chance, and consideration.

The catch is that the opinion could not classify the specific games on the list. Whether roulette, dice, slot machines, poker, blackjack, or sports pools are dominated by chance or by skill is a question of fact, and the Attorney General does not resolve fact questions in the opinion process. He stressed that what matters is the character of the game itself, not how skilled a particular player happens to be. For that reason he declined to answer questions 1 and 2 as a matter of law.

On question 3, the Port Arthur-only proposal, the opinion declined to answer because no draft legislation was provided and the office does not answer speculative questions. It did flag, though, that any statute allowing in one city alone what is otherwise prohibited should be examined under Article III, section 56, which limits local and special laws, while noting a racing statute (V.T.C.S. art. 179e) that ties greyhound-track locations to populous Gulf-border island counties.

Currency note

This opinion was issued in 1990. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Who this opinion affected (as of 1990)

The Legislature: The opinion told lawmakers they could authorize casino-style games without a constitutional amendment only if those games were not lotteries, that is, only if they lacked one of the three elements of prize, chance, and consideration. Games dominated by chance would require amending Article III, section 47.

Casino and gaming proponents: The opinion set the legal test (chance versus skill) but refused to classify roulette, dice, slots, poker, blackjack, or sports pools, treating each game's dominant element as a fact question outside the opinion process.

Port Arthur and local-option gambling advocates: The opinion declined the Pleasure Island question as speculative without draft legislation, and cautioned that a city-specific gambling law would have to be measured against the constitution's limits on local and special laws (Article III, section 56).

Common questions

Does the Texas Constitution ban all gambling?
No. Article III, section 47 requires the Legislature to prohibit "lotteries and gift enterprises," not gambling of every kind. The opinion noted that during the 1875 constitutional convention an amendment to ban "gambling of every character" was proposed and rejected, and that courts have never read section 47 to reach every form of gambling.

What makes a game a "lottery" under the constitution?
Three elements, all of which must be present: a prize, distribution of the prize by chance, and payment of consideration for the chance to win. If any one is missing, the game is not a constitutional lottery.

So could the Legislature legalize casino games by statute?
Yes, but only games that are not lotteries, meaning games that do not combine prize, chance, and consideration. Because a game is a lottery only when chance (not skill) dominates, the Legislature could authorize games in which skill is the dominating element by amending Chapter 47 of the Penal Code, without a constitutional amendment.

Why wouldn't the AG say whether poker or blackjack qualifies?
Because whether chance or skill dominates a particular game is a question of fact, and the Attorney General does not decide fact questions in an opinion. The opinion emphasized that the test looks to the character of the game itself, not to how skillful an individual player is.

Could Texas allow casino gambling only in Port Arthur?
The opinion did not decide that. It declined the question as speculative because no draft bill was submitted, but it warned that a law permitting in one city what is otherwise banned should be evaluated under Article III, section 56, which restricts local and special laws.

Background and statutory framework

Article III, section 47 of the Texas Constitution directs the Legislature to pass laws prohibiting lotteries and gift enterprises, other than the charitable bingo and raffles later authorized by subsections (b) and (d) (added by Acts 1979, 66th Leg., S.J.R. 18, § 1, and Acts 1989, 71st Leg., H.J.R. 32, § 1). The Legislature implemented that command in Chapter 47 of the Penal Code, whose definitions and prohibitions of "gambling" are broad enough to reach the games typically conducted in casinos (Penal Code §§ 47.01, 47.02). The question was whether the listed casino games fall within the constitutional phrase "lotteries and gift enterprises," because if they do, the Legislature could not authorize them by amending the Penal Code alone; if they do not, it could (Tussey v. State, 494 S.W.2d 866 (Tex. Crim. App. 1973); Barry v. State, 45 S.W. 571 (Tex. Crim. App. 1898)).

The earlier Texas Constitutions of 1845, 1861, 1866, and 1869 barred authorizing any lottery and selling lottery tickets (Tex. Const. art. XII, § 36 (1869); art. VII, § 17 (1866, 1861, 1845)). The 1876 Constitution added language reaching "gift enterprises or other evasions involving the lottery principle," apparently to endorse decisions holding that a gift enterprise, as then understood, was essentially a lottery (Randle v. State, 42 Tex. 580 (1875); State v. Randle, 41 Tex. 292 (1874); the 1873 licensing statute had defined "gift enterprises," Acts 1873, 13th Leg., ch. 121, § 3). The Texas Supreme Court has said section 47 condemns not merely lotteries but separately stated schemes that involve the lottery principle, or chance (City of Wink v. Griffith Amusement Co., 100 S.W.2d 695, 701 (Tex. 1936)). At the same time, the drafters did not intend section 47 to proscribe all forms of gambling: a convention amendment to prohibit "gambling of every character in all places" was offered and not adopted, and the term "lottery" was not understood to cover all gambling (Panas v. Texas Breeders & Racing Ass'n, 80 S.W.2d 1020 (Tex. Civ. App. - Galveston 1935, writ dism'd), construing section 47 not to bar wagering on horse races; V.T.C.S. art. 179e, creating the Texas Racing Commission and permitting parimutuel wagering).

Texas courts uniformly identify three elements of a lottery: a prize of money or other value, its distribution by chance, and payment of valuable consideration for the chance to win (City of Wink; Brice v. State, 242 S.W.2d 433, 434 (Tex. Crim. App. 1951); Cole v. State, 112 S.W.2d 725 (Tex. Crim. App. 1937); State v. Socony Mobil Oil Co., 386 S.W.2d 169 (Tex. Civ. App. - San Antonio 1964, writ ref'd n.r.e.); see also Penal Code § 47.01(6), defining "lottery"). The opinion assumed the prize and consideration elements would be present in the listed casino games and focused on the chance element. Drawing on Attorney General Opinion C-619 (1966), it explained that the chance element requires analyzing whether the dominating element of the scheme is chance or skill: a game that depends entirely on skill is not a lottery even if prizes are offered (Boatwright v. State, 38 S.W.2d 87 (Tex. Crim. App. 1931)), while a game in which chance predominates over skill and permeates the whole plan is a lottery (Sherwood & Roberts-Yakima, Inc. v. Leach, 409 P.2d 160 (Wash. 1965)); see also Adams v. Antonio, 88 S.W.2d 503, 505 (Tex. Civ. App. - Waco 1935, writ ref'd).

The opinion therefore concluded that the Legislature may amend Chapter 47 of the Penal Code, without amending section 47 of Article III, to permit gaming activities that do not constitute a lottery (that do not combine consideration, a prize, and chance). Whether any particular listed game involves the dominating element of skill rather than chance is a fact question that cannot be resolved in the opinion process, because it is the character of the game, not the skill of the player, that controls; so the Attorney General could not answer questions 1 and 2. As to question 3, he declined to answer because no draft amendment was supplied and the office does not answer speculative questions, but cautioned that a Port Arthur-only measure should be considered in light of Article III, section 56 (limiting local and special laws), noting V.T.C.S. art. 179e, § 6.14(c) (locating licensed greyhound tracks in populous counties that include a Gulf-border island).

Citations

Constitutional and statutory authorities:

• Tex. Const. art. III, § 47 (prohibition of lotteries and gift enterprises; charitable bingo and raffle exceptions)
• Tex. Const. art. III, § 56 (limits on local and special laws)
• Tex. Const. art. XII, § 36 (1869); art. VII, § 17 (1845, 1861, 1866) (earlier lottery prohibitions)
• Penal Code §§ 47.01, 47.02 (gambling offenses and definitions; § 47.01(6) defines "lottery")
• Acts 1979, 66th Leg., S.J.R. 18, § 1 (bingo amendment); Acts 1989, 71st Leg., H.J.R. 32, § 1 (raffle amendment)
• Acts 1873, 13th Leg., ch. 121, § 3 (defining "gift enterprises")
• V.T.C.S. art. 179e, § 6.14(c) (Texas Racing Commission; greyhound-track location)

Cases:

• Tussey v. State, 494 S.W.2d 866 (Tex. Crim. App. 1973)
• Barry v. State, 45 S.W. 571 (Tex. Crim. App. 1898)
• Randle v. State, 42 Tex. 580 (1875)
• State v. Randle, 41 Tex. 292 (1874)
• City of Wink v. Griffith Amusement Co., 100 S.W.2d 695 (Tex. 1936)
• Panas v. Texas Breeders & Racing Ass'n, 80 S.W.2d 1020 (Tex. Civ. App. - Galveston 1935, writ dism'd)
• Brice v. State, 242 S.W.2d 433 (Tex. Crim. App. 1951)
• Cole v. State, 112 S.W.2d 725 (Tex. Crim. App. 1937)
• State v. Socony Mobil Oil Co., 386 S.W.2d 169 (Tex. Civ. App. - San Antonio 1964, writ ref'd n.r.e.)
• Boatwright v. State, 38 S.W.2d 87 (Tex. Crim. App. 1931)
• Sherwood & Roberts-Yakima, Inc. v. Leach, 409 P.2d 160 (Wash. 1965)
• Adams v. Antonio, 88 S.W.2d 503 (Tex. Civ. App. - Waco 1935, writ ref'd)

Prior Attorney General opinions referenced:

• Attorney General Opinion C-619 (1966) (chance-versus-skill analysis)
• Attorney General Opinions JM-513 (1986); H-820 (1976) (lottery elements); WW-222 (1957); V-1483 (1952); V-544 (1948); V-238 (1947)

Source

• Landing page: https://www.texasattorneygeneral.gov/opinions/jim-mattox/jm-1267
• Original PDF: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1990/jm1267.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain, the linked PDF is authoritative.

THE ATTORNEY GENERAL OF TEXAS

December 20, 1990

Honorable Terral Smith
Chairman
Natural Resources Committee
House of Representatives
P. O. Box 2910
Austin, Texas 78768-2910

Opinion No. JM-1267

Re: Authority of the legislature to permit casino games of chance without a constitutional amendment (RQ-2102)

Dear Representative Smith:

Article III, section 47, of the Texas Constitution provides that the legislature "shall pass laws prohibiting lotteries and gift enterprises," while permitting the holding of certain charitable bingo games and raffles. The legislature has so provided, forbidding in chapter 47 of the Penal Code the holding of lotteries. In addition, the definitions and prohibitions set forth in chapter 47, which proscribes "gambling" as defined in that chapter, are broad enough to effectively prohibit those types of games typically conducted in gambling casinos. See Searcy & Patterson, Practice Commentary, Tex. Penal Code § 47.02 (Vernon 1973).[Footnote 1]

You ask about the proper construction of section 47 of article III. Specifically you ask the following three questions:

1. May the legislature, without an amendment to Article III, Section 47, of the Texas Constitution, authorize any of the following casino gambling games [in] this state:

(a) roulette;
(b) dice;
(c) slot machines; or
(d) other games awarding a prize solely by chance?

2. May the legislature, without an amendment to Article III, Section 47, of the Texas Constitution, authorize any of the following casino gambling games in this state:

(a) poker;
(b) blackjack;
(c) sports pools; or
(d) other games involving an element of skill?

3. May the legislature, without an amendment to Article III, Section 47, of the Texas Constitution, authorize casino gambling to exist only on Port Arthur's Pleasure Island?

There is no question that chapter 47 of the Penal Code proscribes those gaming activities about which you ask. See Penal Code §§ 47.01, 47.02. The issue is whether those gaming activities fall within the ambit of the phrase "lotteries and gift enterprises" set forth in section 47 of article III and are thereby prohibited by the Texas Constitution. If they do, then the legislature may not authorize those activities by amending the Penal Code; if not, then it may. See Tussey v. State, 494 S.W.2d 866 (Tex. Crim. App. 1973); Barry v. State, 45 S.W. 571 (Tex. Crim. App. 1898).

The Texas Constitutions of 1845, 1861, 1866, and 1869 each contained the following prohibition regarding lotteries:

No lottery shall be authorized by this State; and the buying or selling of lottery tickets within this State is prohibited.

Tex. Const. art. XII, § 36 (1869); Tex. Const. art. VII, § 17 (1866); Tex. Const. art. VII, § 17 (1861); Tex. Const. art. VII, § 17 (1845). The constitution of 1876 contained the following prohibition of lotteries set forth in section 47 of article III:

The Legislature shall pass laws prohibiting the establishment of lotteries and gift enterprises in this State, as well as the sale of tickets in lotteries, gift enterprises or other evasions involving the lottery principle, established or existing in other States.

The addition of the language prohibiting "gift enterprises or other evasions of the lottery principle"[Footnote 2] apparently was included in order to indicate the drafters' support of two Texas Supreme Court cases that held that the 13th Legislature did not license the operation of "gift enterprises" by the enactment of an occupation tax on them and that a "gift enterprise," as then understood, was essentially a lottery.[Footnote 3] See Randle v. State, 42 Tex. 580 (1875); State v. Randle, 41 Tex. 292 (1874); 1 G. Braden, The Constitution of the State of Texas: An Annotated and Comparative Analysis 192 (1977).

Section 47 of article III was amended in 1980 to permit the operation of bingo games by charitable organizations and again in 1989 to permit such organizations to hold raffles. Acts 1989, 71st Leg., H.J.R. 32, § 1; Acts 1979, 66th Leg., S.J.R. 18, § 1. Subsection (a) of section 47 of article III of the Texas Constitution now provides the following:

The Legislature shall pass laws prohibiting lotteries and gift enterprises in this State other than those authorized by Subsections (b) and (d) of this section [which authorize the legislature to permit under certain circumstances the conducting of charitable bingo games and raffles]. (Emphasis added.)

The Texas Supreme Court has declared that section 47 was not intended to condemn merely lotteries, but was intended also to condemn separately stated schemes, which were not lotteries, but which involved the lottery principle, or chance:

In general, it may be said that chance is the basic element of a lottery. Unless a scheme for the awarding of a prize requires that it be awarded by a chance, it is not a lottery. . . .

There are, however, in a lottery, according to the authorities, three necessary elements, namely, the offering of a prize, the award of the prize by chance, and the giving of a consideration for an opportunity to win the prize. 38 C.J. p. 289, § 2. But the constitution condemns those things which fall short of containing all the essential elements of a lottery, namely, those things which involve the lottery principle, of which "chance" constitutes the very basis of a lottery, and without which it would not exist. (Emphasis added.)

City of Wink v. Griffith Amusement Co., 100 S.W.2d 695, 701 (Tex. 1936).

But it is equally clear that the drafters did not intend section 47 of article III to proscribe all forms of gambling. During the drafting of the constitution, an amendment to section 47 was offered to add the words "and shall pass laws prohibiting gambling of every character in all places." The amendment was not adopted. 1875 Texas Constitutional Convention, Journal of the Constitutional Convention of the State of Texas, Begun and Held at the City of Austin, September 6, 1875, at 269. Moreover, it is clear that the term "lottery" was not thought at the time that section 47 was adopted to include all forms of gambling either. See Panas v. Texas Breeders & Racing Ass'n, 80 S.W.2d 1020 (Tex. Civ. App. - Galveston 1935, writ dism'd) (construing section 47 not to prohibit wagering on horse races); State v. Randle, 41 Tex. 292 (1874); V.T.C.S. art. 179e (creating the Texas Racing Commission and permitting parimutuel wagering on horse races and greyhound races).

Texas courts uniformly have held that three elements comprise a lottery:

(1) a prize in money or other thing of value;
(2) its distribution by chance; and
(3) payment, either directly or indirectly, of a valuable consideration for the chance to win the prize.

City of Wink; Brice v. State, 242 S.W.2d 433, 434 (Tex. Crim. App. 1951); Cole v. State, 112 S.W.2d 725 (Tex. Crim. App. 1937); State v. Socony Mobil Oil Co., 386 S.W.2d 169 (Tex. Civ. App. - San Antonio 1964, writ ref'd n.r.e.);[Footnote 4] see also Attorney General Opinions JM-513 (1986); H-820 (1976).

With your first two questions, you ask whether a list of gaming activities typically conducted in gambling casinos falls within the ambit of the phrase "lotteries and gift enterprises." For purposes of this opinion, we assume that two of the necessary three elements of a lottery would be present during the holding of the gaming activities about which you inquire, i.e., the payment of consideration and the awarding of a prize. We understand you to ask whether the necessary third element, the award of the prize by chance, as opposed to an award determined by skill, would also be present.

In Attorney General Opinion C-619 (1966), this office was asked whether a certain referral selling plan called a "representative purchasing commission agreement" constituted a lottery. In discussing the necessary element of chance, the opinion declared:

The second element, the distribution of the prize by chance, requires a closer analysis in the light of the decisions as to whether the dominating element of the entire scheme was that of chance, or that of skill, judgment, or ingenuity, 54 C.J.S. 846, Lotteries, Sec. 2b(2), and cases cited. If the plan or game depends entirely on skill, it is not a lottery although prizes are offered for the best solution. Boatwright v. State, 118 Tex. Crim. 381, 38 S.W.2d 87 (1931). If chance predominates over skill or judgment and permeates the whole plan, a lottery is established. Sherwood & Roberts-Yakima, Inc. v. Leach, 67 Wash. 2d 596, 409 P.2d 160 (Wash. Sup. 1965).

Id. at 5-6 (emphasis in original). See Adams v. Antonio, 88 S.W.2d 503, 505 (Tex. Civ. App. - Waco 1935, writ ref'd) (dicta to the effect that gaming statute was violated in instance in which chance predominates over skill); see also Attorney General Opinions WW-222 (1957); V-1483 (1952); V-544 (1948); V-238 (1947).

We conclude that the legislature, without amending section 47 of article III of the Texas Constitution, may amend chapter 47 of the Penal Code to permit the holding of those gaming activities that do not constitute a lottery, i.e., that do not comprise the elements of consideration, a prize, and chance. Whether any of the gaming activities about which you ask involves the dominating element of skill, as opposed to chance, is a question of fact that cannot be resolved in the opinion process. It is the character of the game, and not the skill or want of skill of the player, that determines whether the game is one of skill or chance. See Adams v. Antonio (authorities cited therein). Therefore, we cannot answer your first two questions.

Your third question is whether the legislature may, without amending section 47 of article III of the Texas Constitution, permit the holding of those gaming activities typically comprising casino gambling only in Port Arthur. You have not provided us with a draft of any proposed amendment to chapter 47 of the Penal Code. We do not provide general guidance or answer speculative questions in the opinion process. Accordingly, we decline to answer your third question. We note, however, that any amendment to chapter 47 of the Penal Code that permitted in Port Arthur alone the holding of otherwise proscribed gaming activities should be considered in light of article III, section 56, of the Texas Constitution.[Footnote 5] But see V.T.C.S. art. 179e, § 6.14(c) (provides that each greyhound track licensed under the act must be located in a county that has a population of more than 190,000 according to the most recent federal census, and that includes all or part of an island that borders the Gulf of Mexico).

We conclude that the legislature may, without amending section 47 of article III of the Texas Constitution, amend chapter 47 of the Penal Code to authorize gaming activities that do not constitute a lottery or gift enterprise, i.e., that do not comprise the three elements of consideration, prize, and chance. Whether any specific gaming activity involves the dominating element of skill, as opposed to chance, is a question of fact that this office cannot resolve in the opinion process. Therefore, we cannot answer as a matter of law your first two questions. Because we do not answer speculative questions in the opinion process, we cannot answer your third question.

                   SUMMARY

       The legislature, without amending section 47 of article III of the Texas Constitution, may amend chapter 47 of the Penal Code to authorize the holding of those gaming activities that do not comprise the elements of a lottery, i.e., consideration, prize, and chance. Whether any specific gaming activity involves the dominating element of skill, as opposed to chance, is a question of fact that this office cannot resolve in the opinion process.

                               Very truly yours,

                               JIM MATTOX
                               Attorney General of Texas

MARY KELLER
First Assistant Attorney General

LOU MCCREARY
Executive Assistant Attorney General

JUDGE ZOLLIE STEAKLEY
Special Assistant Attorney General

RENEA HICKS
Special Assistant Attorney General

RICK GILPIN
Chairman, Opinion Committee

Prepared by Jim Moellinger
Assistant Attorney General

Footnote 1: The Practice Commentary to section 47.02 provides in pertinent part:

Section 47.02 as enacted appears to proscribe all forms of gambling, from coinmatching and the weekly football pool to lotteries and roulette to parimutuel betting whether on track or with a bookie. As such the section preserves, although with much greater economy, the basic scheme of prior law that in Penal Code arts. 615 to 618, 644, 645, and 646 to 652 outlawed most forms of gambling.

Footnote 2: It is apparent that the phrase was intended to proscribe other forms of lotteries. See also City of Wink v. Griffith Amusement Co., 100 S.W.2d 695 (Tex. 1936); State v. Randle, 41 Tex. 292 (1874).

Footnote 3: The licensing statute defined "gift enterprises" in the following fashion:

Every person, firm, or corporation who shall sell anything with a promise, either expressed or implied, to give anything in consideration of such sale and purchase, shall be regarded as the proprietor of a gift enterprise.

Acts 1873, 13th Leg., ch. 121, § 3, at 200.

Footnote 4: Subdivision (6) of section 47.01 of the Penal Code defines "lottery" in the following fashion:

"Lottery" means any scheme or procedure whereby one or more prizes are distributed by chance among persons who have paid or promised consideration for a chance to win anything of value, whether such scheme or procedure is called a pool, lottery, raffle, gift, gift enterprise, sale, policy game, or some other name.

Footnote 5: Article III, section 56, of the Texas Constitution prohibits the legislature from enacting, except as provided, local and special laws and provides in pertinent part:

The Legislature shall not, except as otherwise provided in this Constitution, pass any local or special law, authorizing:

. . . .

For limitation of civil or criminal actions:

. . . .

And in all other cases where a general law can be made applicable, no local or special law shall be enacted.