Untitled Texas Attorney General Opinion

GREG ABBOTT
March 23,2007
The Honorable Eddie Lucio, Jr. Opinion No. GA-0533
Chair, Committee on International Relations
and Trade Re: Counties' alternatives for disposing of seized
Texas State Senate gambling contraband (RQ-0536-GA)
Post Office Box 12068
Austin, Texas 787 11-2068
Dear Senator Lucio:
On behalf of the Sheriff of Cameron County, you ask about the county's statutory alternatives
for disposing of seized gambling contraband, specifically, slot machines known as "eight-liner"
machines.'
You ask generally about disposition of eight-liner machines forfeited under article 18.18 of
the Code of Criminal Procedure. Request Letter, supra note 1, at 1. Article 18.18 of the Code of
Criminal Procedure provides for the destruction or forfeiture of gambling contraband:
Following the final conviction of a person for possession of a
gambling device or equipment, altered gambling equipment, or
gambling paraphernalia, . . . the court entering the judgment of
conviction shall order that the machine, device, gambling equipment
or gambling paraphernalia . . . be destroyed or forfeited to the
state. . . . If forfeited, the court shall order the contraband delivered
to the state, any political subdivision of the state, or to any state
institution or agency. If gambling proceeds were seized, the court
shall order them forfeited to the state and shall transmit them to the
grand jury of the county in which they were seized for use in
investigating alleged violations of the Penal Code, or to the state, any
political subdivision of the state, or to any state institution or agency.
TEX.CODEC m . PROC.ANN.art. 18.18(a) (Vernon Supp. 2006); see also TEX.PENALCODEANN.
5 47.06 (Vernon 2003) (criminalizing possession of gambling device, equipment, or paraphernalia).
Article 18.18 further provides procedures for destruction or forfeiture of such contraband when
'See Letter from Honorable Eddie Lucio, Jr., Chair, Committee on International Relations and Trade, Texas
State Senate, to Honorable Greg Abbott, Attorney General of Texas, at 1 (Sept. 22, 2006) (on file with the Opinion
Committee, also available at hffp:/lwww.oag.state.tx.us) [hereinafter Request Letter].
The Honorable Eddie Lucio, Jr. - Page 2 (GA-0533)
prosecution or conviction does not follow seizure. TEX.CODECRIM.PROC.ANN.art. 18.18(b)-(0
(Vernon Supp. 2006). See generally State v. Dugar, 553 S.W.2d 102, 103-04 (Tex. 1977)
(describing differences between article 18.18(a)and (b)). Article 18.18 does not, however, prescribe
a particular manner for disposing of gambling contraband following forfeiture.
As article 18.18 does not specifl a method for disposing of forfeited gambling property, you
ask about the applicability of Local Government Code chapter 263, subchapter D, or "any other
statutes" that may provide a means of disposal other than that set forth in chapter 263. See Request
Letter, supra note 1, at 1. You are particularly interested in any statutory procedures that would
allow a sale to "private investors by a method other than at an open auction." Id. The Sheriff has
suggested that by selling the eight-liner machines in bulk to private investors rather than at public
auction, the county might obtain a better price.2 It has also been suggested that a sale by a method
other than an open auction might allow the county "to ensure that the equipment is not used in the
local community or anywhere else its use is illegal." See Request Letter, supra note 1, at
Consequently, we examine the Code of Criminal Procedure and the Local Government Code for
pertinent provisions.
Chapter 59 of the Code of Criminal Procedure contains detailed provisions for disposition
of forfeited property. See TEX.CODECRIM.PROC.ANN.art. 59.06 (Vernon 2006). See generally
id. arts. 59.01-. 14 (chapter 59). However, chapter 59's definition of "contraband" suggests that the
chapter ordinarily does not apply to "a gambling device or equipment, altered gambling equipment,
or gambling paraphernalia" that may be forfeited under article 18.18. "Contraband" under chapter
59 is defined as property (1) used in the commission of a first or second degree felony or (2) used
or intended to be used in one of the offenses specifically listed in the definition. See id. art. 59.0 l(2).
The definition does not expressly include any gambling offenses, such as those in chapter 47 of the
Penal Code. See TEX.PENALCODEANN.$5 47.01-. 10 (Vernon 2003). And none of the gambling
offenses in chapter 47 of the Penal Code are first or second degree felonies. See id. In particular,
the gambling offense mentioned in article 18.18 of the Code of Criminal Procedure, "possession of
a gambling device or equipment, altered gambling equipment, or gambling paraphernalia," is a class
A misdemeanor. Compare id. $ 47.06(a), (e) (making possession of a gambling device a "Class A
misdemeanor"), with TEX.CODECFUM.PROC.ANN.art. 18.18(a) (Vernon Supp. 2006) (providing
for disposition of gambling contraband "[flollowing the final conviction of a person for possession
of a gambling device or equipment, altered gambling equipment, or gambling ~araphernalia").~
'Letter from Honorable Omar Lucio, Sheriff of Cameron County, to Honorable Eddie Lucio, Chair, Senate
Committee on International Relations and Trade, at 2 (Aug. 14,2006) (attached to Request Letter, supra note 1) (on file
with the Opinion Committee).
3Asyou note, article 18.18 expressly authorizes the destruction of gambling contraband, which would achieve
the goal of ensuring that the property is not reused for illegal purposes. See Request Letter, supra note 1, at 1; TEX.
CODECRIM.PROC.ANN.art. 18.18(a) (Vernon Supp. 2006).
4 ~ n d esection
r 7 1.02 of the Texas Penal Code, a person commits the offense of engaging in organized criminal
activity by committing or conspiring to commit, with the requisite intent, "any gambling offense punishable as a Class
A ~nisdemeanor,"among other listed offenses. See TEX.PENALCODEANN.$ 7 1.02(a) (Vernon Supp. 2006). An offense
(continued.. .)
The Honorable Eddie Lucio, Jr. - Page 3 (GA-0533)
Eight-liner machines seized under article 18.18 of the Code of Criminal Procedure ordinarily would
not constitute chapter 59 "contraband" and thus would not be subject to that chapter's procedures.
Other provisions in the Code of Criminal Procedure that deal with the disposition of property
under specific circumstances are inapplicable to gambling property forfeited under article 18.18.
See, e.g., TEX.CODECRIM.PROC.ANN. arts. 18.17 (Vernon 2005) (disposition of unclaimed or
abandoned property); 47.01-. 12 (Vernon 2006) (disposition of stolen property). Consequently, the
Code of Criminal Procedure does not provide ameans for disposing of eight-liner machines forfeited
under article 18.18.
Thus, we turn to chapter 263 of the Local Government Code, by which a county may sell or
lease property. Subchapters A, B, C, E, and F of chapter 263 do not apply because they all concern
disposition of property under specific circumstances that would not include forfeited personal
property. See TEX.LOC.GOV'TCODEANN.$5 263.001-.107, .201-.251 (Vernon 2005). Chapter
263's remaining property dispositionprovisions, those in subchapter D, authorize a county to dispose
of personal property as either "salvage property" or "surplus property," which are defined terms:
(1) "Salvage property" means personal property, other than items
routinely discarded as waste, that because of use, time, accident, or
any other cause is so worn, damaged, or obsolete that it has no value
for the purpose for which it was originally intended.
(2) "Surplus property" means personal property that:
(A) is not salvage property or items routinely discarded as
waste;
(B) is not currently needed by its owner;
(C) is not required for the owner's foreseeable needs; and
(D) possesses some usefulness for the purpose for which it was
originally intended.
Id. $ 263.15 1. See generally id. $tj 263.15 I-. 158 (subchapter D). Section 263.152 authorizes the
commissioners court to "periodically sell the county's surplus or salvage property." Id. $263.152(a).
Eight-liner machines are personal property. See Sun Antonio Area Found. v. Lung, 35
S.W.3d 636, 640 (Tex. 2000) ("Personal property is defined broadly to include everything that is
subject to ownership not falling under the definition of real estate."). Whether the county is the
"owner" of such property would depend on the terms of the court's order of forfeiture. The property
4(. ..continued)
under section 71.02 "is one category higher than the most serious offense [in the section's list of crimes] that was
committed, and if the most serious offense is a Class A misdemeanor, the offense is a felony of the third degree." Id.
g 7 1.02(b).
The Honorable Eddie Lucio, Jr. - Page 4 (GA-0533)
would likely qualify as salvage property if "it has no value for the purpose for which it was originally
intended'' and otherwise meets that definition, or as surplus property, assuming the county is the
owner of the property, if it "possesses some usefulness for the purpose for which it was intended."
See TEX.LOC.GOV'TCODEANN.5 263.15 1 (Vernon 2005). Thus, to answer your initial question,
depending on the terms of the court's order and the particular facts and circumstances, Local
Government Code chapter 263, subchapter D may apply to the disposal of eight-liner slot machines.
And our review has not revealed another statute that would apply generally to the county's sale of
property forfeited under article 18.18 of the Code of Criminal Procedure.
Consequently, we next consider the methods of sale that subchapter D, chapter 263 of the
Local Government Code allows. The commissioners court is authorized to "adopt rules necessary
to administer" subchapter D. Id. § 263.158. Nevertheless, section 263.152 authorizes the sale of
surplus or salvage property only "by competitive bid or auction." Id. 5 263.152(a).5 Thus, although
the commissioners court's rule-making authority gives it some discretion to choose the method and
terms of sale of surplus or salvage property, such rules must be consistent with a sale by
"competitive bid or auction." Id.
While no statute defines "competitive bid or auction," the Supreme Court of Texas has
described the "purpose and intent of competitive bidding ordinances and statutes" as follows:
"Competitive bidding" requires due advertisement, giving
opportunity to bid, and contemplates a bidding on the same
undertaking upon each of the same material items covered by the
contract; upon the same thing. It requires that all bidders be placed
upon the same plane of equality and that they each bid upon the same
terms and conditions involved in all the items and parts of the
contract, and that the proposal specify as to all bids the same, or
substantially similar specifications. . . . There can be no competitive
bidding in a legal sense where the terms of the letting of the contract
prevent or restrict competition . . . .
Tex. Highway Comm 'n v. Tex. Ass 'n of Steel Imps., Inc., 372 S.W.2d 525,527 (Tex. 1963) (quoting
Sterrett v. Bell, 240 S.W.2d 5 16,520 (Tex. Civ. App.-Dallas 1951, no writ)). In short, competitive
bidding procedures will generally include due advertising and terms of purchase or sale that treat
bidders equally and do not restrict ~ o m ~ e t i t i o Assuming
n.~ that chapter 263 applies to the sale of
a particular eight-liner machine forfeited under article 18.18 of the Code of Criminal Procedure, the
?Section 263.152(a) contains an exception to the bidding or auction requirement when the purchaser of the
property is another county or political subdivision. TEX.LOC.GOV'TCODEANN. 5 263.152(a) (Vernon 2005). The
statute also allows a county to trade in, destroy, or donate to charity county property under certain circumstances. Id.
5 263.152(a)(2)-(4).
6The County Purchasing Act contains procedures and requirements for a county to purchase property by
competitive bid. Seegenerally id. $ 5 262.02 1L.036 (Vernon 2005). While the County Purchasing Act applies to county
purchases rather than sales, it provides general insight into the Legislature's view of competitive bidding practices.
The Honorable Eddie Lucio, Jr. - Page 5 (GA-0533)
commissioners court may by rule adopt a method of sale other than at "open auction" provided the
method is essentially a sale by competitive bid or auction. See TEX. LOC. GOV'TCODEANN.
$8 263.152-. 158 (Vernon 2005).
Perhaps anticipating this answer, you also ask whether "the county [may] use a competitive
bidding procedure under which bidders are required to contractually agree to take the equipment to
a jurisdiction where its use is not illegal." Request Letter, supra note 1, at 1. You express some
concern that such a requirement might constitute an improper geographic restriction on the sale. See
id. (citing Tex. Att'y Gen. Op. Nos. MW-139 (1980), DM-1 13 (1992)). While such a requirement
might restrict the number of willing bidders, chapter 263 authorizes the commissioners court or its
representative to reject any bid "in the best interests of the county." See TEX.LOC.GOV'TCODE
ANN. $ 263.154 (Vernon 2005). The county's best interest is a question of fact for the
commissioners court to determine in the first instance and thus cannot be resolved in the opinion
process. See Tex. Att'y Gen. Op. No. GA-0446 (2006) at 18 ("Questions of fact are not appropriate
to the opinion process."). But given the county's interest in ensuring that the eight-liner machines
are not used illegally in the community, we believe the commissioners court could exercise its rule-
making authority to condition all sales on the purchaser's agreement to remove the machines to a
jurisdiction where their use would not be illegal. See TEX. PENALCODEANN. 5 47.06(a), (f)
(Vernon 2003) (making it an offense to own, transfer, or possess a gambling device with intent to
promote gambling; recognizing a defense when the purpose is to ship the device to another
jurisdiction where possession or use is legal).
The Honorable Eddie Lucio, Jr. - Page 6 (GA-0533)
S U M M A R Y
Depending on the terms of the court order forfeiting eight-
liner machines as gambling contraband, and assuming such machines
meet the definition of surplus or salvage property under Local
Government Code chapter 263, a county commissioners court may
order the machines sold by competitive bid or auction. The
commissioners court may adopt rules requiring the purchasers to
remove the property to a jurisdiction in which its use is legal.
Attorney General of Texas
KENT C. SULLIVAN
First Assistant Attorney General
ELLEN L. WITT
Deputy Attorney General for Legal Counsel
NANCY S. FULLER
Chair, Opinion Committee
William A. Hill
Assistant Attorney General, Opinion Committee