Issue 1

The concurrent tournaments restriction in the proposed regulation are extremely detrimental to the play of charitable Texas Hold’em Poker.

The proposed regulations states, “A qualified organization may not hold concurrent poker tournaments.” (See proposed regulation: 11VAC20-30-90F). If this is approved, there could only be one tournament being played at a time. So, for example, if a tournament starts at 7 p.m. and lasts until 10 p.m., then no one arriving after 7 p.m. can have an opportunity to play until 10 p.m. This would obviously be an immense inconvenience to the players and create a massive disincentive for any player to actually go to the charity to play unless they are 100% sure they can be there by 7 p.m. The charities respectfully request that they be allowed to play tournaments with different start times, which is clearly allowed by the current Virginia Code.

Issue 2

These regulations creating new sets of rules of play cannot be passed by regulation because the General Assembly has not given the Department the authority to do so.

Besides being a massive disincentive to play, the Department of Agriculture and Consumer Services (hereinafter “Department”) does not have the power to create a new rule of play because such power is not authorized by the Code of Virginia.

A. There is no specific authority given by the legislature giving the Department power to promulgate regulations on the timing of poker games (e.g. banning of concurrent games)

In researching this issue, I found no code section nor enactment language in a bill giving the Department the authority to pass regulations on the general conduct of Texas Hold’em Poker. There are specific instructions by the legislature to the Department to promulgate regulations related to Texas Hold’em Poker, but all are specific designations and do not give the Department authority to promulgate regulation on how Texas Hold’em Poker is to be played.

The Department can only promulgate a regulation with the authority of the General Assembly. For example, if the Code states that the Department of Environmental Quality shall pass regulations on air pollution from cars, that does not give the Department the authority to pass regulations on the brightness of headlights or rules on seat belts. In Avalon Assisted Living Facilities v. Zager, 389 Va. App 484 (2002) the Virginia Court of Appeals, describes this rule:

When the legislature delegates authority to an administrative agency to promulgate regulations, those regulations must neither exceed the scope of the authority delegated nor be inconsistent with it. See, e.g., Brown, 34 Va.App. at 276, 540 S.E.2d at 522.

Thus, as it relates to passing regulations for charitable Texas Hold’em Poker, the Department’s authority to promulgate regulations can only be for those subjects specifically stated by the legislature.

In this situation, the General Assembly specifically listed what regulations it wanted the Department to promulgate regarding Texas Hold’em Poker, and the issue of concurrent games is not one of the General Assembly’s requests. (A search of Title 18.2, Chapter 8, Article 1.1:1. Charitable Gaming, shows only three code sections discussing the promulgation of regulations for Texas Hold’em Poker. In addition, this counsel knows that instructions were included in enactment language of HB 765 from the 2022 Session.)

The General Assembly set forth the regulations it wanted passed in four different sections: (1) Enactment language found it HB 765 from the 2022 General Assembly Session, (2) VA Code 18.2-340.18; (3) VA Code 18.2-340.19, and (4) VA Code 18.2-340.28:2.

HB 765 from the 2022 Virginia General Assembly Session

HB 765 from the 2022 Session is the enabling legislation for these regulations. HB 765 states that the Department “… shall promulgate regulations consistent with Chapter 982 of the Acts of Assembly of 2020 (emphasis added). Chapter 982 of the Acts of Assembly 2020 lists numerous rules of play for Texas Hold’em poker:

• "Texas Hold'em poker game" means a variation of poker in which (i) players receive two cards facedown that may be used individually, (ii) five cards shown faceup are shared among all players in the game, (iii) players combine any number of their individual cards with the shared cards to make the highest five-card hand to win the value wagered during the game, and (iv) the ranking of hands and the rules of the game are governed by the official rules of the Poker Tournament Directors Association.”
• "Texas Hold'em poker tournament" or "tournament" means an organized competition of players (i) who pay a fixed fee for entry into the competition and for a certain amount of poker chips for use in the competition; (ii) who may be allowed to pay an additional fee, during set preannounced times of the competition, to receive additional poker chips for use in the competition; (iii) who may be seated at one or more tables simultaneously playing Texas Hold'em poker games; (iv) who upon running out of poker chips are eliminated from the competition; and (v) a pre-set number of whom are awarded prizes of value according to how long such players remain in the competition.

Note that nowhere in this language is anything regarding timing of games. The Department only has authority to promulgate regulations “consistent with the provisions” of Chapter 982 of the Acts of Assembly 2020. Inserting new rules not related to the provision of Chapter 982 of the Acts of Assembly 2020 is not “consistent with the provisions.” Thus, a rule requiring all games to be concurrent is not a rule that can be promulgated by the Department.

§18.2-340.18

18.2-340.18 lists the powers and duties of the Department.

18.2-340.18. Powers and duties of the Department.
The Department shall have all powers and duties necessary to carry out the provisions of this article and to exercise the control of charitable gaming as set forth in § 18.2-340.15. Such powers and duties shall include the following:
1. The Department is vested with jurisdiction and supervision over all charitable gaming authorized under the provisions of this article and including all persons that conduct or provide goods, services, or premises used in the conduct of charitable gaming. It may employ such persons as are necessary to ensure that charitable gaming is conducted in conformity with the provisions of this article and Department regulations. The Department shall designate such agents and employees as it deems necessary and appropriate who shall be sworn to enforce the provisions of this article and the criminal laws of the Commonwealth and who shall be law-enforcement officers as defined in § 9.1-101.
2. The Department, its agents and employees and any law-enforcement officers charged with the enforcement of charitable gaming laws shall have free access to the offices, facilities, or any other place of business of any organization, including any premises devoted in whole or in part to the conduct of charitable gaming. These individuals may enter such places or premises for the purpose of carrying out any duty imposed by this article, securing records required to be maintained by an organization, investigating complaints, or conducting audits.
3. The Department may compel the production of any books, documents, records, or memoranda of any organization, electronic gaming manufacturer, or supplier involved in the conduct of charitable gaming for the purpose of satisfying itself that this article and its regulations are strictly complied with. In addition, the Department may require the production of an annual balance sheet and operating statement of any person granted a permit pursuant to the provisions of this article and may require the production of any contract to which such person is or may be a party.
4. The Department may issue subpoenas for the attendance of witnesses before it, administer oaths, and compel production of records or other documents and testimony of such witnesses whenever, in the judgment of the Department, it is necessary to do so for the effectual discharge of its duties.
5. The Department may compel any person conducting charitable gaming to file with the Department such documents, information, or data as shall appear to the Department to be necessary for the performance of its duties.
6. The Department may enter into arrangements with any governmental agency of this or any other state or any locality in the Commonwealth or any agency of the federal government for the purposes of exchanging information or performing any other act to better ensure the proper conduct of charitable gaming.
7. The Department may issue a charitable gaming permit while the permittee's tax-exempt status is pending approval by the Internal Revenue Service.
8. The Department shall report annually to the Governor and the General Assembly, which report shall include a financial statement of the operation of the Department and any recommendations for legislation applicable to charitable gaming in the Commonwealth.
9. The Department, its agents, and employees may conduct such audits, in addition to those required by § 18.2-340.31, as they deem necessary and desirable.
10. The Department may limit the number of organizations for which a person may manage, operate, or conduct charitable games.
11. The Department may promulgate regulations that require any landlord that leases to a qualified organization any premises devoted in whole or in part to the conduct of bingo games or any other charitable gaming to register with the Department. (emphasis added)
12. The Department may report any alleged criminal violation of this article to the appropriate attorney for the Commonwealth for appropriate action.
13. Beginning July 1, 2024, and at least once every five years thereafter, the Department shall convene a stakeholder work group to review the limitations on prize amounts and provide any recommendations to the General Assembly by November 30 of the year in which the stakeholder work group is convened.

This code section is quoted in its entirety because it sets forth the “powers and duties of the Department.” Note that nowhere in this language is anything regarding timing of games. In addition, this code section gives the Department authority to promulgate regulations dealing with registration of landlords. Inserting new rules not related to this provision is not authorized. Thus, a rule requiring all games to be concurrent is not a rule that can be promulgated by the Department.

§ 18.2-340.19.
This code section states what regulations are to be passed. (Note: It says “Board,” but these responsibilities were transferred to the Department by other more recent legislation.)
§ 18.2-340.19 is the code section outlining the regulatory powers of the Department. It is specific about what the Department can regulate, and no where does it allow for the power to regulate timing of games.  (Because comments are only allowed 3000 words, I will summarize this instead of quoting directly.)
Section A (1) deals with how proceeds of the gaming must be used
Section A (2) deals with membership lists
Section A (3) deals with fees for processing applications.
Section A (4) deals with audits of reports
Section A (5) deals with electronic and mechanical equipment
Section A (6) deals with the conduct of bingo.
Section A (7) deals with raffle tickets
Section A (8) deals with the conduct bingo
Section A (9) deals with the conduct of bingo
Section A (10) deals with posting signs for “Gamblers Anonymous”
Section A (11) deals with network bingo.
Section A (12) deals with poker, but it only authorizes regulations on how a charity can use operators to assist in the conduct of games. (Note that this does not include authority over the rules of how the games are played.)
Section A (13) deals with a charity leasing its premises “… for bingo, network bingo, instant bingo, pull tabs, seal cards, and electronic gaming…” and for financial reporting of electronic gaming.
Section B deals only with bingo.

In summary, nowhere in this language is anything regarding start time of games. Inserting new rules not related to either of these provisions is not authorized. Thus, a rule requiring all games to be concurrent is not a rule that can be promulgated by the Department.

§ 18.2-340.28:2.
This code section states:

18.2-340.28:2 Conduct of Texas Hold'em poker tournaments by qualified organizations; limitation of operator fee; conditions.
A. Any organization qualified to conduct bingo games on or after July 1, 2019, may conduct Texas Hold'em poker tournaments; however, no such organization may conduct individual Texas Hold'em poker games. The Commissioner shall promulgate regulations establishing circumstances under which organizations qualified to conduct bingo games prior to July 1, 2019, may conduct Texas Hold'em poker tournaments. (emphasis added)
B. A qualified organization may contract with an operator to administer Texas Hold'em poker tournaments. Limitations on operator fees shall be established by Board regulations.
C. A qualified organization shall accept only cash or, at its option, checks in payment of any charges or assessments for players to participate in Texas Hold'em poker tournaments. However, no such organization shall accept postdated checks in payment of any charges or assessments for players to participate in Texas Hold'em poker tournaments.
D. No qualified organization or any person on the premises shall extend lines of credit or accept any credit or debit card or other electronic fund transfer in payment of any charges or assessments for players to participate in Texas Hold'em poker tournaments.
E. No qualified organization shall allow any individual younger than 18 years of age to participate in Texas Hold'em poker tournaments.

Note that this code section gives authority for the Department to do regulations on allowing charities that did bingo prior to July 1, 2019. Nowhere in this language is anything regarding timing of games. Inserting new rules not related to charities that did bingo prior to July 1, 2019 is not authorized by this code section. Thus, a rule requiring all games to be concurrent is not a rule that can be promulgated by the Department.

B. The lack of authority to promulgate regulations on the timing of poker games is likely intentional.

The lack of a rule on concurrent games may likely be intentional. In the recent 2023 session, there was much discussion on the timing of games. SB 1518 dealt with timing issues such as limits on the number of days and hours of play, and it was defeated. By defeating such a bill, the General Assembly has shown it does not want to regulate the timing of games. (See SB 1518 and its proposed amendments. http://leg1.state.va.us/cgi-bin/legp504.exe?231+ful+SB1518S1)