• Texas laws prohibit game rooms from paying players for gambling.f?ate foraine 12 image by Nathalie P from Fotolia.com
  
  Texas laws and courts are strict on game rooms. The Texas Penal Code describes most gambling activity held on public property as illegal. Nevertheless, game rooms are prevalent throughout the state. The penal code prohibits game rooms from operating as a gambling enterprise and awarding cash prizes. The Attorney General and Texas Supreme Court have further clarified types of prizes that cannot be awarded.
  
  

Texas Penal Code

• Chapter 47 of the Texas Penal Code prohibits many types of gambling, including placing bets on any game played with cards, balls, dice or other devices used for gambling. It also prevents businesses from "keeping a gambling place." Most game rooms fall under this category. It's illegal to have any building, room, boat or other property for use as a gambling place. Although the law doesn't prohibit the types of devices normally used at game rooms, cash prizes or any non-cash prize valued at five times what it costs to play are illegal.
  
  

Texas Supreme Court Ruling

• The Texas Supreme Court ruled on the issue of non-cash prizes because many game rooms were circumventing the law. The Court ruled that game room machines cannot dispense tickets redeemable for cash or extra games. Game room operators had argued that the redeemable ticket itself was not worth more than five times the cost of playing.
  
  

Texas Attorney General Ruling

• A ruling by the Texas Attorney General in 2007 found that eight-liner machines cannot give out gift certificates to reward winners. The reasoning behind that ruling was because the gift certificates were used as a medium of exchange for cash.