A Few Lines on Texas' "Eight-Liner" Machines

It’s hard to find a legal casino in Texas. They're against State law, except for those Native American casinos permitted because of tribal sovereignty. The Lone Star State has three federally recognized native American tribes, but only one of them, the Kickapoo, is authorized under IGRA (Indian Gaming Regulatory Act of 1987) to own and operate a casino. Casino gambling is illegal under state law (Sect 47.01) in Texas but, because of tribal sovereignty, that tribe has been able to operate its casino outside of state jurisdiction. 

The other two Texas tribes, the Tigua and the Alabama-Coushatta tribes, wanted to operate casinos, but were specifically prohibited by IGRA from doing so according to 500 Nations. They opened casinos anyway without state approval in 1992/1993, but after a 10 year battle in the courts, they were forced to close. The Kickapoo, despite being an IGRA tribe, was also sued in 2008 by the Texas Attorney General’s office. That case is now before the US Supreme Court after the tribe lost in the Fifth Circuit Court of Appeals. So, before long it is possible that the Lucky Eagle Casino located in Eagle Pass about 100 miles south of San Antonio might also be forced to close. If that happens, Texas will have NO casinos operating legally in that state.

However, that doesn’t mean Texas doesn’t have any illegal ones. Despite state laws saying otherwise, illegal casinos thrive throughout the state of Texas. An underground billion-dollar industry operates in a gray area grown even grayer as the state, several cities, and some counties have imposed taxes and fees on the illegal gambling room operators to fill their coffers. Texas has 30,000 - 150,000 illegal slot machines that make an estimated $1.9 billion annually, according to the Texas Lottery Commission. They operate out of abandoned or fake businesses and have turned up in spaces that appear to be karate schools, car dealerships, repair shops and even a gravel warehouse. Much like the speakeasies of prohibition days, law enforcement officials are sometimes bribed (according to the New York Times and prosecutor Richard Roper) to avoid being raided.

The illegal “slot” machines are called “eight-liner” machines. They got that name because, to win, the horizontal, vertical, and diagonal eight rows of symbols in a 3x3 array must line up. The machines come in multiple variants and can include video reel, video keno, and video bingo games among others. 

The state makes money off these games. Some of the machines confiscated in raids have official state tax decals on them. The Texas comptroller’s office reportedly collects $10 million annually through a coin-operated machines tax which included eight-liners, pool tables, and other devices.  Starr County charges eight-liner operators $500 per machine through an annual licensing fee approved by the County Commissioners’ Court last year. The profitability of these games perhaps causes officials to turn a blind eye to the legality of these operations. The industry has grown so large, particularly near the border, that it has attracted the attention of Homeland Security.  

How did the industry which under Texas law should not even exist become so widespread and profitable? Gamblers have an unlikely group to thank: the Texas Legislature. 

Prior to 1993, the Texas Penal Code prohibited any game of chance that “for consideration affords the player anything of value.” In 1993 the Legislature amended the statute by adding Section 47.01(4)(B). It relaxed the standard by making legal any electronic or mechanical device made solely for bona fide amusement purposes. The legislation was so innocuous it was known as the “fuzzy animals” bill. It was intended to ensure that games such as those played by children at arcades or carnivals would not be considered unlawful gambling devices. The bill stipulated that the games award non-cash prizes with a value of up to $5 (or no more than 10 times the amount charged to play).

Of course the “fuzzy animal law” has been used to justify machines that go way beyond children’s games. Eight-liner operators have used various tactics to “skirt” the law. In one case gift certificates redeemable at retail stores were awarded. The courts ruled these gift certificates were the same as cash. In another instance point were allowed to accumulate and be played in other machines and eventually be used to “buy” more expensive merchandise.

Legislators have introduced bills (HB 1154) and (HB 1183) which would have assessed penalties and fines, but neither were enacted. City ordinances passed zoning restrictions prohibiting coin-operated amusement machines within 300 feet of churches, schools, or hospitals. Still the popular games  grew in popularity.

Cameron County has taken steps to try to dismantle the eight-liner industry. The attorney general authorized nearly 40 raids of gambling establishments including one targeting the American Legion in Port Isabel. His actions have cost him votes, led to a death threat against him, and supplied him with his own gambling room of sorts. About 100 slot machines seized in the raids sit in a brick warehouse, and 500 others were sold to a company that paid the country $100,000. Environmental regulations prohibit his destroying the machines, he reportedly said.

Sounds like Texas still has a long way to go solving its eight-liner problem, and enforcement of the 1993 “fuzzy animals”  bill is still pretty fuzzy.