CHARITABLE BINGO OPERATIONS DIVISION ANNUAL REPORT TEXAS LOTTERY COMMISSION

CHARITABLE BINGO ANNUAL REPORT OPERATIONS DIVISION TEXAS LOTTERY COMMISSION

A MESSAGE FROM THE CHAIRMAN OF THE TEXAS LOTTERY COMMISSION AND THE DIRECTOR OF THE CHARITABLE BINGO OPERATIONS DIVISION On behalf of the Commissioners and the Charitable Bingo Operations Division of the Texas Lottery Commission, we want to thank all the members of the charitable bingo industry for making 2016 another great year. We are pleased to present the Charitable Bingo Operations Division 2016 Annual Report. Charitable bingo continues to play an important role in assisting many of Texas nonprofit organizations with their charitable purposes. In calendar year 2016, reported total gross receipts were over $761.5 million, a $4.7 million increase from 2015. Gross receipts have steadily increased in the past four years. Pull-tab sales have seen an increase in sales every year since 2002 and account for approximately 54 percent of total gross receipts. Total prizes reported paid to players were more than $579.7 million, the highest in the history of charitable bingo in Texas. Charitable distributions saw a 5.8 percent increase over 2015 with licensed authorized organizations reporting that they distributed $30.2 million for their charitable purposes; 1,001 charitable organizations in Texas were licensed to conduct charitable bingo in 2016. These non-profit Texas charities through a variety of actions provide a multitude of services throughout the state that support the local community with the use of their charitable distributions to benefit a wide range of charitable causes including, but not limited to, education scholarships, assisting needy children, the disabled, veterans, senior citizens, Meals on Wheels, Boys and Girls Clubs, food banks, job and disaster assistance. Furthermore, during calendar year 2016, $19.1 million was deposited into the General Revenue Fund and an additional $13.9 million was allocated to cities and counties that share in the prize fees collected, due to the conduct of bingo games. The year covered by this report includes some key Division accomplishments. Most notable are: A bingo industry stakeholder workgroup was created. The workgroup is comprised of various industry representatives of the bingo community and Commission staff. The purpose of the workgroup is to collaborate on industry related topics, rules and to review challenges and opportunities in an effort to better serve and improve charitable bingo in Texas.

The redesigned CBOD website was launched. It allows users to browse information with improved user accessibility. The website provides an enhanced experience when navigating bingo information provided on various web pages or searching for updated forms and instructions. A new social media page was unveiled. By implementing a social media presence through Facebook, CBOD is able to further foster communications with the bingo industry and the public by disseminating helpful bingo related information, articles and announcements. A link to the Facebook page is available on the redesigned website. Audits resulted in an increase in charitable distributions of $45,062. The audits revealed incorrect valuation of merchandise prizes, lack of documentation for expenses and unreasonable or unnecessary expenses. With the expense obligations from the audited period having already been paid, the required re-deposit of funds into the affected organizations bingo bank account went directly to the charities as charitable distributions. We strive to provide consistent, effective and efficient regulation to the charitable bingo industry in Texas. We will continue to work in partnership with industry representatives to further develop and implement policies and procedures that benefit the non-profit organizations conducting authorized bingo activities in Texas to raise funds for their charitable purposes and ultimately the citizens of Texas. We look forward to the future and new opportunities to fulfill our mission to regulate Charitable Bingo in the state of Texas. J. Winston Krause, Chairman Texas Lottery Commission Alfonso D. Royal III, Director Charitable Bingo Operations Division

TABLE OF CONTENTS Agency Vision....1 Agency Mission...1 Agency Core Values...1 Charitable Bingo Operations Division Mission Statement....2 Charitable Bingo Operations Division Regulatory Objective....2 Terminology in the 2015 Annual Report...3 2001.060 Report... 4 Data in the 2015 Annual Report...5 Bingo Revenue and Business Activities...5 Gross Receipts...6 Adjusted Gross Receipts and Net Proceeds....7 Prizes Paid to Players....7 Charitable Distributions....8 Attendance...9 Commercial Lessor Lease Income and Rental Tax...9 Charitable Bingo Allocations to Cities and Counties....10 Revenue to the State...11 Licensed Organizations...12 Conductor Licenses...13 Types of Licenses...14 Bingo Training Program...15 Audit Activity...15 Final Administrative Actions...16 Registry of Approved Bingo Workers...16 Appendix A: Gross Receipts, Prizes, and Charitable Distributions...17 Appendix B: Charitable Bingo Allocations to Counties and Percentage of Change...21 Appendix C: Charitable Bingo Allocations to Cities and Percentage of Change...23

TEXAS LOTTERY COMMISSION Agency Vision To be the preeminent Lottery and Charitable Bingo agency through innovative leadership. Agency Mission Texas Lottery: The Texas Lottery is committed to generating revenue for the state of Texas through the responsible management and sale of entertaining lottery products. The Texas Lottery will incorporate the highest standards of security and integrity, set and achieve challenging goals, provide quality customer service and utilize a TEAM approach. Agency Core Values Integrity and Responsibility - The Commission works hard to maintain the public trust by protecting and ensuring the security of our lottery games, systems, drawings and operational facilities. We value and require ethical behavior by our employees, licensees and vendors. We promote the integrity of charitable bingo in Texas for the benefit of charitable organizations. Innovation - We strive to incorporate innovation into our products to provide the citizens of Texas with the best entertainment experience available through our products. We pursue the use of technology that enhances the services that we provide to our customers and reduces our operating expenses. All proposed innovations must be authorized by Texas law, and do not include video lottery, casino gaming, internet-based lottery sales, fantasy sports, or any other activities not authorized by law. Fiscal Accountability - We emphasize fiscal accountability by ensuring that all expenditures directly or indirectly generate revenue, enhance security, fulfill regulatory requirements, improve customer service, and/or boost productivity. We recognize our responsibility in generating revenue for the state of Texas without unduly influencing players to participate in our games. We maximize benefits to charities through the continual examination and review of charitable bingo operations. Customer Responsiveness - The Commission takes pride in providing exemplary service to the people of Texas through the courteous dissemination of 1

clear and accurate information about our products, services and regulatory functions. We seek and respond to feedback expressed by our employees, retailers, licensees and the playing and non-playing public. We apply this feedback in the development of our products and in the services that we provide. Teamwork - We are committed to creating an environment of mutual respect where open, honest communication is our cornerstone. We embrace the diversity of our team and individual perspectives in working together to achieve our common goals. Excellence - We strive for excellence by taking a position of leadership on issues that impact the Commission and achieve challenging goals by focusing on our core values. Charitable Bingo Operations Division Mission Statement Provide authorized organizations the opportunity to raise funds for their charitable purposes by conducting bingo. Determine that all charitable bingo funds are used for a lawful purpose. Promote and maintain the integrity of the charitable bingo industry throughout Texas. Charitable Bingo Operations Division Regulatory Objective Charitable Bingo is an important fundraising activity for a variety of Texas nonprofit organizations. The Charitable Bingo Operations Division of the Texas Lottery Commission is charged with the strict control and close supervision of bingo conducted in this state so that bingo is fairly conducted and the proceeds from bingo are used for an authorized purpose. Our goal is to achieve voluntary compliance and assist licensees through training and education. We will strive for the highest levels of professionalism, conducting our regulatory activities fairly, competently and consistently. We will develop clear regulatory requirements in an open environment, encouraging two-way communication. 2

TERMINOLOGY IN THE 2015 ANNUAL REPORT Act refers to the Bingo Enabling Act, TEX. OCC. CODE ANN 2001 Commission refers to the five-member Texas Lottery Commission Conductor a licensed authorized organization that holds a license to conduct bingo, also referred to as a licensed authorized organization Distributor a person who obtains, by purchase or otherwise, bingo equipment or supplies for use in bingo in Texas and sells or furnishes the items to another person for use, resale, display or operation Lessor a person licensed to lease premises for the purpose of conducting bingo, also referred to as a licensed commercial lessor Licensed authorized organization (Conductor) an authorized organization that holds a license to conduct bingo Licensed commercial lessor (Lessor) a person licensed to lease premises and act as a commercial lessor Manufacturer a person who assembles from raw materials or subparts a completed piece of bingo equipment or supplies for use in bingo games in Texas or a person who converts, modifies, adds to, or removes parts from any bingo equipment, item, or assembly to further its promotion or sale for or use in a bingo games in Texas Person an individual, partnership, corporation, or other group Rule or Rules refers to Charitable Bingo Administrative Rules, 16 TEX. ADMIN. CODE (TAC) ch.402. 3

2001.060 REPORTING TEX. OCC. CODE ANN 2001.060(a) requires that the Commission on or before June 1 of each even-numbered year, shall prepare and deliver to the Governor, the Lieutenant Governor, the Speaker of the House of Representatives, and the chairs of the standing committees of the Senate and House of Representatives with primary jurisdiction over charitable bingo a report stating for each of the preceding two calendar years: (1) the total amount of adjusted gross receipts reported by licensed authorized organizations from their bingo operations; (2) the total amount of net proceeds reported by licensed authorized organizations from their bingo operations; and (3) a comparison of the amounts reported under Subdivisions (1) and (2), including the percentage that the net proceeds represents of the adjusted gross receipts. (b) For purposes of Subsection (a), adjusted gross receipts means the amount remaining after deducting prizes paid, excluding prize fees collected from bingo players. (c) For purposes of Subsection (a), the Commission shall determine the total amount of net proceeds in a manner that does not reduce gross receipts by the amount of rent paid for the rental of bingo premises by a licensed authorized organization to another licensed authorized organization if the other organization pays rent for the premises to a licensed commercial lessor. The table below provides the information requested in 2001.060 of the Bingo Enabling Act: 2015 2016 Adjusted Gross Receipts (AGR) $181,521,189 $181,786,832 Total Expenses $150,391,417 $151,011,089 Net Proceeds (NP) $32,382,452 $31,808,346 NP as a percentage of AGR 17.67% 17.50% Rent Income reported by Lessors $41,681,324 $43,321,575 Rent Income reported by Conductor/Lessors $1,726,082 $1,327,535 Rent Payments reported by conductors $44,935,298 $45,817,629 Rent Income reported twice $710,625 $635,502 Actual Rent Income *$43,407,406 $44,655,110 4 Source: Texas Lottery Commission. Figures as of 3/7/2017. Unaudited. *Revised to correct reporting error. Previously reported as $44,224,673.

DATA IN THE Data included in the 2016 Annual Report is for calendar years, unless indicated otherwise, and is unaudited. In most instances, data for 10 years (2007-2016) is included to provide a benchmark measurement for comparison and analysis. In some instances, data is included from 1982 through 2016 to provide an expanded basis for comparison and to show trends from the inception of bingo in Texas through 2016. BINGO REVENUE AND BUSINESS ACTIVITIES Since the first licenses were issued in 1982, charitable bingo has had positive benefits for charities, players, and state, county and municipal governments in Texas. Gross receipts from the conduct of charitable bingo total more than $20 billion, bingo prizes awarded have been in excess of $14.6 billion, and allocations to local jurisdictions have totaled approximately $329.8 million. The total amount of charitable distributions from the conduct of bingo exceeds $1 billion. Distributions by organizations conducting charitable bingo benefit the people of Texas in many ways that include providing assistance to local libraries, veterans organizations, museums, women s shelters, needy children, the disabled, homeless shelters, churches, schools, drug and alcohol treatment programs, medical treatment and research programs, volunteer fire departments, EMS units, police officer organizations, and senior citizen organizations, to name a few. Local jurisdictions benefit from charitable bingo activity through allocations derived from charitable bingo prize fees. The table below provides data related to gross receipts, prizes paid to players, charitable distributions, and allocations to cities and counties from 2007 through 2016. YEAR CHARITABLE BINGO FOR CALENDAR YEARS 2007 2016 TOTAL GROSS RECEIPTS PRIZES PAID TO PLAYERS CHARITABLE DISTRIBUTIONS ALLOCATIONS 2007 $658,203,740 $493,339,524 $32,090,655 $11,598,956 2008 $685,573,612 $513,228,658 $32,852,800 $11,866,340 2009 $693,290,588 $518,394,364 $36,036,457 $12,264,641 2010 $699,434,079 $526,737,400 $33,910,570 $12,338,567 2011 $706,128,229 $534,017,329 $29,039,795 $12,576,181 2012 $723,514,855 $549,003,354 $29,464,079 $12,898,689 2013 $719,645,137 $549,396,054 $26,574,139 $13,044,976 2014 $739,748,181 $566,542,028 $25,849,321 $13,344,205 2015 $756,772,779 $575,251,590 $28,521,047 $13,873,760 2016 $761,488,986 $579,702,154 $30,187,208 $13,912,375 Source: Texas Lottery Commission. Figures as of 3/7/2017. Unaudited. 5

GROSS RECEIPTS 6 The table below compares all categories of gross receipts and the percentage changes from year to year from 1982 through 2016 and is based on information reported by licensed authorized organizations. CHANGES IN BINGO GROSS RECEIPTS BY CATEGORY CALENDAR YEARS 1982 2016 YEAR CARD SALES % CHANGE CARD SALES PULL-TAB SALES % CHANGE PULL-TAB SALES TOTAL GROSS RECEIPTS 1982 $66,488,368 $0.00 $66,488,368 % CHANGE TOTAL GROSS RECEIPTS 1983 $163,172,680 145.42% $87 $163,172,767 145.42% 1984 $217,137,488 33.07% $4,676,582 5375281.61% $221,814,070 35.94% 1985 $243,420,805 12.10% $11,872,941 153.88% $255,293,746 15.09% 1986 $289,108,477 18.77% $13,548,709 14.11% $302,657,186 18.55% 1987 $331,938,566 14.81% $36,086,789 166.35% $368,025,355 21.60% 1988 $365,110,091 9.99% $101,901,561 182.38% $467,011,652 26.90% 1989 $419,677,774 14.95% $130,997,997 28.55% $550,675,771 17.91% 1990 $467,113,452 11.30% $154,335,596 17.82% $621,449,048 12.85% 1991 $499,971,275 7.03% $173,501,233 12.42% $673,472,508 8.37% 1992 $503,400,917 0.69% $164,719,328-5.06% $668,120,245-0.79% 1993 $500,434,638-0.59% $151,592,343-7.97% $652,026,981-2.41% 1994 $492,662,092-1.55% $140,391,468-7.39% $633,053,560-2.91% 1995 $498,120,463 1.11% $139,769,085-0.44% $637,889,548 0.76% 1996 $488,946,621-1.84% $121,816,923-12.84% $610,763,544-4.25% 1997 $491,756,262 0.57% $104,836,239-13.94% $596,592,501-2.32% 1998 $506,642,255 3.03% $99,144,445-5.43% $605,786,700 1.54% 1999 $510,317,138 0.73% $96,753,377-2.41% $607,070,515 0.21% 2000 $493,414,252-3.31% $89,353,141-7.65% $582,767,393-4.00% 2001 $478,397,545-3.04% $85,122,819-4.73% $563,520,364-3.30% 2002 $468,107,354-2.15% $88,979,503 4.53% $557,086,857-1.14% 2003 $445,876,396-4.75% $129,825,563 45.91% $575,701,959 3.34% 2004 $430,908,286-3.36% $173,828,243 33.89% $604,736,529 5.04% 2005 $410,842,204-4.66% $223,189,408 28.40% $634,031,612 4.84% 2006 $404,772,215-1.48% $253,552,957 13.60% $658,325,172 3.83% 2007 $385,245,447-4.82% $272,958,293 7.65% $658,203,740-0.02% 2008 $379,825,563-1.41% $305,748,049 12.01% $685,573,612 4.16% 2009 $374,585,169-1.38% $318,705,419 4.24% $693,290,588 1.13% 2010 $372,245,845-0.62% $327,188,234 2.66% $699,434,079 0.89% 2011 $362,293,559-2.67% $343,834,670 5.09% $706,128,229 0.96% 2012 $360,354,775-0.54% $363,160,080 5.62% $723,514,855 2.46% 2013 $350,179,110-2.82% $369,466,027 1.74% $719,645,137-0.53% 2014 $346,532,176-1.04% $393,216,005 6.43% $739,748,181 2.79% 2015 $347,255,426 0.21% $409,517,353 4.15% $756,772,779 2.30% 2016 $346,399,863-0.25% $415,089,123 1.36% $761,488,986 0.62% Source: Texas Lottery Commission. Figures as of 3/7/2016. Unaudited.

ADJUSTED GROSS RECEIPTS AND NET PROCEEDS Adjusted Gross receipts is the sum of card sales, entrance fees, electronic card sales, and pull-tab bingo sales less total bingo prizes awarded. Net proceeds are the sum of adjusted gross receipts plus all other income (rent income, interest earned, and the value of merchandise prizes donated) less total expenses. The following table compares adjusted gross receipts to net proceeds to net proceeds as a percentage of adjusted gross receipts from 2007 through 2016: YEAR NET PROCEEDS AS A PERCENTAGE OF ADJUSTED GROSS RECEIPTS 2007 2016 ADJUSTED GROSS RECEIPTS NET PROCEEDS NET PROCEEDS AS A PERCENTAGE OF ADJUSTED GROSS RECEIPTS 2007 $164,864,216 $34,053,668 20.66% 2008 $172,344,954 $36,436,987 21.14% 2009 $174,896,224 $33,149,364 18.95% 2010 $172,696,679 $28,758,502 16.65% 2011 $172,110,900 $28,614,701 16.63% 2012 $174,511,501 $28,755,029 16.48% 2013 $170,249,083 $26,010,188 15.28% 2014 $175,239,197 $27,508,385 15.70% 2015 $181,521,189 $32,382,452 17.84% 2016 $181,786,832 $31,808,346 17.50% Source: Texas Lottery Commission Figures as of 3/7/2017. Unaudited. PRIZES PAID TO PLAYERS A bingo prize may not have a value of more than $750 for a single game. For regular bingo games that award individual prizes of more than $50, the total value of prizes awarded during a bingo occasion cannot exceed $2,500. Note: A bingo occasion may not exceed four hours. Prizes paid to players in 2016 was $579.7 million, the highest since the issuance of the first bingo licenses in 1982. The increase in prizes paid to players is attributable to pull-tab prizes that were the highest since the inception of the sale of pull-tabs in Texas. The following table shows prizes paid to players from 2007 through 2016 based on information reported by licensed authorized organizations: 7

YEAR REGULAR & ELECTRONIC PRIZES PULL-TAB PRIZES TOTAL PRIZES 2007 $295,665,506 $197,674,018 $493,339,524 2008 $291,822,316 $221,406,342 $513,228,658 2009 $288,580,678 $229,813,686 $518,394,364 2010 $291,886,622 $234,850,778 $526,737,400 2011 $287,602,541 $246,414,788 $534,017,329 2012 $288,889,746 $260,113,608 $549,003,354 2013 $285,595,157 $263,800,897 $549,396,054 2014 $285,959,414 $280,582,614 $566,542,028 2015 $283,884,109 $291,367,481 $575,251,590 2016 $284,989,268 $294,712,886 $579,702,154 Source: Texas Lottery Commission. Figures as of 3/7/2017. Unaudited. BINGO PRIZES PAID 2007 2016 CHARITABLE DISTRIBUTIONS Licensed authorized organizations must disburse all net proceeds from the preceding quarter. Under Section 2001.457 of the Act, a licensed authorized organization must disburse all net proceeds from the preceding quarter less the retained operating capital. Charitable distributions saw a 5.8 percent increase in 2016 with organizations reporting $30.2 million for their charitable purposes. The data in the following table compares minimum required charitable distributions by the Bingo Enabling Act to charitable distributions reported by licensed authorized organizations from 2007 through 2016: REQUIRED CHARITABLE DISTRIBUTIONS COMPARED TO REPORTED CHARITABLE DISTRIBUTIONS 2007 2016 8 YEAR REQUIRED CHARITABLE DISTRIBUTION REPORTED CHARITABLE DISTRIBUTION 2007 $10,177,920 $32,090,655 2008 $10,144,499 $32,852,800 2009 $10,702,494 $36,036,457 2010 $8,390,641 $33,910,570 2011 $7,143,665 $29,039,795 2012 $7,956,701 $29,464,079 2013 $6,389,262 $26,574,139 2014 $6,718,326 $25,849,321 2015 $7,721,150 $28,521,047 2016 $8,806,971 $30,187,208 Source: Texas Lottery Commission. Figures as of 3/7/2017. Unaudited.

ATTENDANCE The figures for attendance do not reflect the number of people playing bingo in the years referenced but are the cumulative reported attendance of persons at bingo games. Attendance is reported quarterly by licensed authorized organizations that conduct bingo. The following table shows attendance from calendar years 2007 through 2016 and is based on information reported by licensed authorized organizations. Although there is a 2.41 percent increase in attendance for 2016, attendance has shown a steady decline from 2007 to 2016, with only a slight increase of.53 percent from 2008 to 2009. The 2016 increase can be attributed to utilizing frequent player rewards and the use of social media for advertisement. YEAR BINGO ATTENDANCE 2007 2016 ATTENDANCE CHANGE ATTENDANCE % CHANGE ATTENDANCE 2007 17,926,344-1,422,250-7.35% 2008 17,741,456-184,888-1.03% 2009 17,834,674 93,218 0.53% 2010 17,625,187-209,487-1.17% 2011 16,777,821-847,366-4.81% 2012 16,363,763-414,058-2.47% 2013 15,858,584-505,179-3.09% 2014 15,616,387-242,197-1.53% 2015 14,843,568-772,819-4.95% 2016 15,200,801 357,233 2.41% Source: Texas Lottery Commission. Figures as of 3/7/2017. Unaudited. COMMERCIAL LESSOR LEASE INCOME AND RENTAL TAX The rent charged by a licensed commercial lessor to a licensed authorized organization to conduct bingo may not exceed $600 for each bingo occasion conducted on the lessors premises unless, the licensed authorized organization subleases the premises to one or more other licensed authorized organizations to conduct bingo, in which case the rent charged by the licensed commercial lessor may not exceed $600 for each day. Prior to September 1, 2015, there was a 3-percent tax on gross rentals received by a licensed commercial lessor for the rental of premises where bingo is conducted. The rental tax was repealed during the 84th Legislature (HB 1905). Rental taxes collected by the Commission after September 1, 2015 were earned prior to this date. 9

The following table shows lease income and rental tax reported by licensed commercial lessors from 2007 through 2016: COMMERCIAL LESSORS LEASE INCOME & RENTAL TAX 2007 2016 YEAR TOTAL REPORTED LEASE INCOME (LESSORS) TOTAL RENTAL TAX PAID (LESSORS) 2007 $38,851,449 $1,173,736 2008 $39,853,394 $1,181,320 2009 $42,228,938 $1,242,551 2010 $40,872,364 $1,215,920 2011 $41,106,922 $1,230,247 2012 $40,462,765 $1,214,463 2013 $40,973,911 $1,203,151 2014 $43,301,716 $1,222,859 2015 $43,407,406 $909,807 2016 $44,655,110 $21,417 Source: Texas Lottery Commission. Figures as of 3/7/2017. Unaudited. 10 CHARITABLE BINGO ALLOCATIONS TO CITIES AND COUNTIES Section 2001.502 of the Act requires a licensed authorized organization to collect from a person who wins a bingo prize of more than $5 a fee in the amount of five percent of the amount or value of the prize; and remit to the commission a fee in the amount of five percent of the amount or value of all bingo prizes awarded. Local jurisdictions in Texas benefit from charitable bingo activities in the form of allocations derived from bingo prize fees. A county that imposed a gross receipts tax on the conduct of bingo as of January 1, 1993, is entitled to 50 percent of the prize fee collected under 2001.502 of the Act, on a prize awarded at a game conducted in the county. A municipality that imposed a gross receipts tax on the conduct of bingo as of January 1, 1993, is entitled to 50 percent of the fee collected under 2001.502 on a prize awarded at a game conducted in the municipality. If a county and municipality are both entitled to a share of the fee imposed by 2001.502 of the Act, the county is entitled to 25 percent of the fee on a prize

awarded at a game conducted in the county and the municipality is entitled to 25 percent of the fee on a prize awarded at a game conducted in the municipality. All prize fees that are not allocated to local jurisdictions are deposited into the state s General Revenue Fund. Each quarter, two percent of the total prize fees collected is retained in the jurisdiction s suspense account. The Commission may make refunds from the suspense account of a jurisdiction for overpayments made to those accounts and may redeem dishonored checks and drafts deposited to the credit of the jurisdiction s suspense account. The following table shows allocations derived from bingo prize fees from 2007 through 2016: ALLOCATIONS 2007 2016 YEAR CITIES COUNTIES STATE TOTAL 2007 $5,553,344 $6,045,612 $13,009,408 $24,608,365 2008 $5,731,619 $6,134,721 $13,156,222 $25,022,561 2009 $5,887,555 $6,377,086 $13,621,194 $25,885,835 2010 $5,891,842 $6,446,725 $13,680,985 $26,019,552 2011 $6,026,935 $6,549,246 $13,884,537 $26,460,718 2012 $6,133,125 $6,765,564 $14,161,379 $27,060,068 2013 $6,113,554 $6,931,422 $14,523,257 $27,568,233 2014 $6,181,340 $7,162,865 $14,625,975 $27,970,180 2015 $6,461,517 $7,412,243 $15,137,912 $29,011,672 2016 $6,456,774 $7,455,601 $15,239,648 $29,152,023 Source: Texas Lottery Commission. Figures as of 3/7/2017. Unaudited. REVENUE TO THE STATE Charitable bingo activities in Texas generate revenue for the state. The following is an analysis of money generated from charitable bingo activities and deposited to the General Revenue Fund in calendar year 2016: Prize Fees and rental tax collected* $28,982,097 Total license fees collected (Conductor/Lessor/Worker Registry) 3,805,668 Total license fees collected (Manufacturer/Distributor) 72,500 Administrative penalties/settlement fees collected 56,888 Miscellaneous/Other 1,233 Total deposited to General Revenue Fund $32,918,386 Allocations paid to cities and counties (13,853,206) Net deposited to General Revenue Fund $19,065,180 Source: Texas Lottery Commission. Figures as of 03/26/2017. Unaudited. *Rental tax repealed by 84th Legislature (HB 1905). 11

LICENSED ORGANIZATIONS The Charitable Bingo Operations Division licenses the following types of organizations related to the regulation of charitable bingo in Texas: Conductor an authorized organization that conducts bingo. This represents the largest category of licensees in the charitable bingo industry in Texas. Lessor an individual or organization that leases a location to an authorized conductor organization for the purpose of conducting a charitable bingo game. Distributor an individual or organizations that sells, distributes, or supplies equipment to organizations authorized to conduct bingo. Manufacturer an individual or organization that manufactures bingo equipment and sells to licensed distributors in Texas. The following table shows organizations by organization type from 2007 through 2016: TYPES OF LICENSES 2007 2016 YEAR CONDUCTOR LESSOR DISTRIBUTOR MANU- FACTURER TOTAL % CHANGE 2007 1,312 432 15 16 1,775-0.11% 2008 1,310 431 16 17 1,774-0.06% 2009 1,255 416 20 17 1,708-3.72% 2010 1,254 418 18 17 1,707-0.06% 2011 1,227 417 16 18 1,678-1.70% 2012 1,091 385 17 16 1,509-10.07% 2013 1,066 367 17 12 1,462-3.11% 2014 1,025 355 19 14 1,413-3.35% 2015 1,000 319 11 14 1,344-4.88% 2016 1,001 272 10 21 1,304-2.98% Source: Texas Lottery Commission. Figures as of 3/7/2017. Unaudited 12

CONDUCTOR LICENSES Section 2001.101 of the Act defines the types of nonprofit organizations eligible for a license to conduct bingo in Texas. Those organizations are: l A religious society that has existed in Texas for at least three years. l A nonprofit organization: u whose predominant activities are for the support of medical research or treatment programs; and u that for at least three years: n must have had a governing body or officers elected by a vote of members or by a vote of delegates elected by the members, or n must have been affiliated with a state or national organization organized to perform the same purposes as the nonprofit organization. l A fraternal organization that has existed in this state for at least three years. l A veterans organization that has existed in this state for at least three years. l A volunteer fire department that has existed in this state for at least three years. l A volunteer emergency medical service that has existed in this state for at least three years. There were a total of 1,001 licensed conductors in 2016. By December 31, 2016, 68 of those licensees had a 2-year license and did not need to renew in 2016, 37 had a pending renewal and 27 surrendered their license. The following table shows conductor licenses by organization type from calendar year 2007 through 2016: CONDUCTOR LICENSEES BY ORGANIZATION TYPE 2007 2016 CALENDAR YEAR RELIGIOUS MEDICAL FRATERNAL VOLUNTEER FIRE DEPT. VETERAN EMS EMS/ NAT L HIST. TOTAL 2007 155 30 803 64 260 0 0 1,312 2008 149 30 815 61 255 0 0 1,310 2009 141 30 793 52 236 3 0 1,255 2010 141 28 796 52 233 3 1 1,254 2011 131 30 792 51 219 3 1 1,227 2012 115 26 715 42 189 3 1 1,091 2013 120 26 700 38 177 4 1 1,066 2014 118 27 672 35 168 4 1 1,025 2015 112 27 663 36 157 4 1 1,000 2016 108 27 676 34 151 4 1 1,001 Source: Texas Lottery Commission. Figures as of 3/7/2017. Unaudited. 13

TYPES OF LICENSES The following table describes the types of licenses issued by the Charitable Bingo Operations Division, the purpose of each license type, and the type of licensee they are issued to: LICENSE TYPE PURPOSE ISSUED TO Original To obtain an initial license for a specific license type. Conductors Lessors Manufacturers Distributors Renewal Amendment Temporary To renew the license. A license may be renewed on an annual or biannual basis. To change information on a conductor or lessor license. May include changes in playing days, times, location of games, or organization s location, officers or bingo chairperson. Issued to authorized organizations to conduct bingo for one, four-hour occasion on a specific day at a specific time. Organizations that hold a regular license to conduct bingo may obtain 24 temporaries per license period. Organizations that play bingo only on temporary non-regular licenses may obtain six temporary licenses per calendar year. Conductors Lessors Manufacturers Distributors Conductors Lessors Conductors The following table shows licenses issued by license type from 2007 to 2016: YEAR ORIGINALS ISSUED LICENSES ISSUED BY LICENSE TYPE 2007 2016 RENEWALS ISSUED AMENDMENTS ISSUED TEMPORARY ISSUED TOTAL ISSUED 2007 70 1,496 764 4,917 7,247 2008 86 1,496 745 4,766 7,093 2009 65 1,416 818 5,199 7,498 2010 87 1,289 742 7,084 9,202 2011 80 1,245 721 7,416 9,462 2012 52 1,221 517 8,012 9,802 2013 70 1,024 549 8,481 10,124 2014 49 1,081 547 9,115 10,792 2015 51 1,322 232 8,113 9,718 2016 75 1,097 499 1,831 3,502 14 Source: Texas Lottery Commission. Figures as of 3/7/2017. Unaudited.

BINGO TRAINING PROGRAM Sections 2001.107, 2001.437(h) and 2001.438(e) of the Bingo Enabling Act require the bingo chairperson of every licensed authorized organization to complete the Bingo Training Program. Under the provisions of 2001.107, 2001.437(h) and 2001.438(e) of the Act, unit managers and designated agents are also required to complete training. Other officers and members may also complete the training programs. In June 2008, the online version of the Bingo Training Program was made available on the website. The online version allows the individuals required to complete the training program to do so at their own pace without the need to travel to an on-site training program or taking time off from work. It also reduces travels expenses for the Division due to a reduction in on-site training programs. AUDIT ACTIVITY In 2016, the Audit Services Department of the Charitable Bingo Operations Division conducted a variety of audit activities including game inspections, oversight of destructions, complaint investigations, compliance audits and reviews. The Bingo Enabling Act (BEA) and Administrative Rules (Rules) require licensees to maintain certain documentation. Licensees are not required to maintain records in a specific format but they are required to maintain the information that is included on the forms suggested by the Commission. During game inspections, investigations and audits, licensee records are inspected and audited to determine if the required records and information are maintained in compliance with the BEA and Rules. The Commission conducts compliance audits and reviews to determine if the records and accounts of the organization accurately reflect financial and fiscal operations, if effective accounting and internal controls are maintained, and to determine if funds are received and used for purposes authorized by the BEA and Rules. The following table shows audit activities in calendar year 2016: AUDIT ACTIVITIES 2016 ACTIVITY NUMBER HOURS CONDUCTOR COMPLIANCE REVIEW 198 18526 DESTRUCTION 4 64 GAME INSPECTION 103 1994 LIMITED SCOPE REVIEW 2 301 CAMP Complaints Investigations 161 644 Source: Texas Lottery Commission. Figures as of 3/7/2017. Unaudited.. 15

FINAL ADMINISTRATIVE ACTIONS The following chart is a summary of administrative actions taken by the Commission related to violations of the Bingo Enabling Act and Charitable Bingo Administrative Rules in 2016: ACTION NUMBER Original Conductor Application Denied 7 Conductor Renewal Application Denied 1 Lessor Renewal Application Denied 2 Consent Orders/Settlement Agreements 84 Warnings and Notification of Violations 360 Total Amount of Penalties Assessed $64,639 Source: Texas Lottery Commission. Figures as of 3/7/2017. Unaudited. REGISTRY OF APPROVED BINGO WORKERS The Texas Lottery Commission maintains a registry of approved bingo workers. The registry is a list of persons on whom the Commission has conducted a criminal history background check and is approved to be involved in the conduct of bingo. Only individuals listed on the registry may be involved in the conduct of bingo. The commission issues an identification card to an individual when they are approved to be listed on the registry. As of December 31, 2016, there were 9,605 individuals listed on the Registry of Approved Bingo Workers. In addition, the following occurred relative to the worker registry in 2016: 2,512 individuals renewed their worker registration 1,614 individuals submitted an original application to be added to the worker registry 3,328 individuals registrations expired 34 individuals were denied registration Source: Texas Lottery Commission. Figures as of 3/7/2017. Unaudited. 16

COUNTY APPENDIX A GROSS RECEIPTS, PRIZES AND CHARITABLE DISTRIBUTIONS BY COUNTY GROSS RECEIPTS BINGO PRIZES TOTAL INCOME TOTAL EXPENSES NET PROCEEDS CHARITABLE DISTRIBUTIONS ANDERSON $2,784,922.00 $2,070,328.00 $714,594.00 $603,611.00 $112,195.00 $86,800.00 ANGELINA $5,315,380.00 $4,033,050.00 $1,282,536.00 $921,598.00 $368,152.00 $344,943.00 ARANSAS $540,401.00 $350,150.00 $190,269.00 $158,076.00 $32,311.00 $37,348.00 ATASCOSA $28,318.00 $12,571.00 $15,747.00 $1,210.00 $14,537.00 $15,429.00 AUSTIN $746,316.00 $564,329.00 $182,030.00 $113,209.00 $69,637.00 $66,189.00 BANDERA $132,830.00 $108,485.00 $24,345.00 $13,560.00 $13,537.00 $11,802.00 BASTROP $409,771.00 $304,742.00 $105,042.00 $75,960.00 $29,015.00 $29,288.00 BEE $219,202.00 $174,599.00 $44,603.00 $8,132.00 $36,409.00 $40,034.00 BELL $34,134,662.00 $25,133,913.00 $9,205,289.00 $6,869,545.00 $2,321,095.00 $2,320,423.00 BEXAR $144,990,893.00 $114,500,199.00 $30,665,611.00 $25,396,501.59 $5,051,973.41 $4,538,245.41 BLANCO $1,039.00 $600.00 $439.00 $25.00 $414.00 $414.00 BOSQUE $58,097.00 $44,130.00 $13,967.00 $5,441.00 $8,679.00 $5,629.00 BOWIE $3,718,416.00 $2,507,980.00 $1,210,452.00 $1,039,722.00 $170,365.00 $193,617.00 BRAZORIA $1,543,537.00 $1,072,776.00 $470,783.00 $322,911.00 $146,069.00 $149,562.00 BRAZOS $13,420,467.00 $10,327,812.00 $3,092,662.00 $2,499,316.00 $589,458.00 $590,950.00 BROWN $2,278,665.00 $1,697,520.00 $584,006.00 $425,038.00 $157,816.00 $151,334.00 BURLESON $624,974.00 $488,213.00 $136,802.00 $128,772.00 $8,087.00 $25,614.00 BURNET $348,027.00 $274,373.00 $73,654.00 $42,463.00 $30,391.00 $24,075.00 CALDWELL $6,062.00 $3,555.00 $2,507.00 $212.00 $2,295.00 $2,295.00 CALHOUN $0.00 $0.00 $0.00 $30.00 -$30.00 $0.00 CAMERON $10,280,479.00 $7,595,249.00 $2,685,257.00 $2,243,913.00 $441,860.00 $451,223.00 CASTRO $1,225.00 $613.00 $612.00 $25.00 $587.00 $588.00 COLLIN $4,778,760.00 $3,429,583.00 $1,349,177.00 $1,109,834.00 $235,574.00 $192,162.00 COLORADO $396,767.00 $323,689.00 $73,078.00 $36,030.00 $37,230.00 $29,680.00 COMAL $492,558.00 $371,658.00 $120,908.00 $96,059.00 $22,138.00 $45,113.00 CONCHO $1,892.00 $900.00 $992.00 $150.00 $842.00 $842.00 CORYELL $10,315,953.00 $8,216,520.00 $2,099,440.00 $1,679,369.00 $428,618.00 $447,284.00 DALLAS $63,366,727.00 $46,600,565.00 $17,051,948.00 $15,382,625.00 $1,671,201.00 $1,455,605.00 DENTON $1,765,691.00 $1,400,876.00 $396,815.00 $373,571.00 $17,239.00 $50,576.00 DEWITT $281,034.00 $214,904.00 $66,130.00 $43,759.00 $22,387.00 $23,834.50 DIMMIT $300,646.00 $225,075.00 $75,571.00 $20,703.00 $54,796.00 $53,087.00 DUVAL $49,441.00 $40,948.00 $8,493.00 $1,748.00 $4,405.00 $757.00 ECTOR $11,656,515.00 $9,202,398.00 $2,497,989.00 $2,369,572.00 $67,055.00 $251,160.00 EDWARDS $1,325.00 $1,090.00 $235.00 $50.00 $185.00 $185.00 EL PASO $5,746,976.00 $4,289,735.00 $1,457,287.00 $1,044,621.00 $402,340.00 $435,744.00 ELLIS $554,565.00 $395,907.00 $158,658.00 $130,884.00 $29,087.00 $25,387.00 17

GROSS RECEIPTS, PRIZES AND CHARITABLE DISTRIBUTIONS BY COUNTY (CONT D) COUNTY GROSS RECEIPTS BINGO PRIZES TOTAL INCOME TOTAL EXPENSES NET PROCEEDS CHARITABLE DISTRIBUTIONS ERATH $583,103.00 $421,152.00 $161,951.00 $149,053.00 $11,511.00 $13,424.00 FALLS $7,556.00 $3,242.00 $4,314.00 $290.00 $4,024.00 $4,049.00 FAYETTE $205,765.00 $139,847.00 $65,918.00 $13,450.00 $52,325.00 $42,428.00 FORT BEND $1,108,291.00 $784,745.00 $323,683.00 $206,018.00 $117,373.00 $121,806.00 FRANKLIN $797,217.00 $615,392.00 $181,847.00 $147,879.00 $34,247.00 $38,907.00 FREESTONE $0.00 $0.00 $0.00 $896.00 -$896.00 $974.00 FRIO $60,289.00 $45,795.00 $14,494.00 $3,545.00 $10,987.00 $11,520.00 GALVESTON $6,322,699.00 $4,375,551.00 $1,947,148.00 $1,422,255.00 $523,151.00 $526,505.00 GLASSCOCK $2,627.00 $900.00 $1,727.00 $25.00 $1,702.00 $1,702.00 GONZALES $7,087.00 $3,271.00 $3,816.00 $820.00 $2,996.00 $2,996.00 GRAY $42,478.00 $29,646.00 $12,832.00 $11,079.00 $1,723.00 $889.00 GRAYSON $1,479,998.00 $1,162,336.00 $333,162.00 $237,492.00 $82,980.00 $90,741.00 GREGG $10,386,869.00 $8,302,038.00 $2,085,375.00 $1,937,323.00 $145,187.00 $204,428.00 GUADALUPE $6,095,722.00 $4,801,390.00 $1,328,959.00 $897,198.00 $433,906.00 $382,088.00 HARRIS $59,936,837.00 $45,316,336.00 $14,620,813.00 $12,520,069.00 $2,139,956.00 $1,690,295.04 HARRISON $209,517.00 $193,603.00 $16,407.00 $15,014.00 $1,218.00 $1,085.00 HAYS $246,432.00 $164,140.00 $82,301.00 $15,587.00 $66,960.00 $58,725.00 HENDERSON $1,583,068.00 $1,101,051.00 $482,017.00 $404,749.00 $77,326.00 $78,665.00 HIDALGO $30,584,388.00 $22,960,979.00 $7,623,986.00 $6,515,843.00 $1,096,003.00 $1,095,651.00 HILL $1,930,459.00 $1,526,668.00 $403,791.00 $384,202.00 $19,071.00 $11,182.00 HOWARD $951,005.00 $703,303.00 $286,902.00 $276,703.00 $10,472.00 $12,385.00 HUTCHINSON $75,143.00 $51,714.00 $23,429.00 $14,120.00 $9,249.00 $7,250.00 JEFFERSON $6,288,446.00 $4,220,638.00 $2,069,866.00 $1,785,556.00 $285,304.00 $349,147.00 JIM WELLS $339,292.00 $219,012.00 $120,280.00 $67,235.00 $53,085.00 $52,281.00 JOHNSON $4,136,241.00 $3,245,939.00 $890,302.00 $680,504.00 $220,192.00 $192,784.00 KARNES $20,703.00 $7,439.00 $13,264.00 $575.00 $12,689.00 $14,214.00 KAUFMAN $2,173,255.00 $1,554,794.00 $618,461.00 $545,315.00 $71,926.00 $58,175.00 KENDALL $382.00 $200.00 $182.00 $0.00 $182.00 $182.00 KERR $1,015,260.00 $756,609.00 $258,651.00 $181,878.00 $77,106.00 $81,521.00 KLEBERG $447,175.00 $287,686.00 $159,489.00 $149,108.00 $10,804.00 $23,368.00 LAMAR $1,410,787.00 $1,035,023.00 $375,764.00 $322,347.00 $52,204.00 $55,000.00 LAVACA $324,125.00 $217,517.00 $106,608.00 $65,652.00 $41,075.00 $42,150.00 LEE $1,468.00 $1,192.00 $276.00 $100.00 $176.00 $517.00 LEON $30,574.00 $17,166.00 $13,414.00 $1,744.00 $11,627.00 $11,316.00 LIBERTY $328,064.00 $233,995.00 $94,069.00 $48,660.00 $45,678.00 $40,323.00 LIVE OAK $3,625.00 $1,860.00 $1,765.00 $50.00 $1,715.00 $1,715.00 18

COUNTY GROSS RECEIPTS, PRIZES AND CHARITABLE DISTRIBUTIONS BY COUNTY (CONT D) GROSS RECEIPTS BINGO PRIZES TOTAL INCOME TOTAL EXPENSES NET PROCEEDS CHARITABLE DISTRIBUTIONS LLANO $37,848.00 $2,597.00 $35,251.00 $23,739.00 $11,520.00 $11,501.00 LUBBOCK $29,287,164.00 $21,876,437.00 $7,424,441.00 $5,625,912.00 $1,754,203.00 $1,814,907.00 LYNN $108,867.00 $100,476.00 $8,391.00 $5,064.00 $3,553.00 $4,500.00 MARTIN $2,833.00 $2,325.00 $508.00 $191.00 $317.00 $317.00 MATAGORDA $999,571.00 $728,429.00 $271,142.00 $228,425.00 $40,050.00 $50,869.00 MAVERICK $62,778.00 $34,000.00 $28,778.00 $26,846.00 $1,977.00 $3,885.00 MCCULLOCH $158,363.00 $120,775.00 $37,588.00 $33,437.00 $4,325.00 $3,800.00 MCLENNAN $19,285,217.00 $15,008,507.00 $4,349,967.00 $3,517,982.00 $848,691.00 $954,807.00 MEDINA $381,795.00 $267,193.00 $114,602.00 $51,086.00 $64,240.00 $47,176.00 MENARD $23,166.00 $15,631.00 $7,535.00 $5,814.00 $1,679.00 $1,603.00 MIDLAND $11,556,217.00 $8,746,708.00 $2,809,565.00 $2,066,926.00 $738,620.00 $649,561.00 MILAM $42,632.00 $29,954.00 $12,678.00 $4,203.00 $8,414.00 $8,213.00 MITCHELL $740.00 $250.00 $490.00 $25.00 $465.00 $465.00 MONTGOMERY $13,565,929.00 $10,352,431.00 $3,219,498.00 $2,213,020.00 $1,022,593.00 $846,030.00 MOORE $1,993.00 $0.00 $1,993.00 $178.00 $1,815.00 $1,815.00 $4,292,731.00 $3,350,543.00 $942,304.00 $801,211.00 $140,095.00 $139,372.00 NAVARRO $1,801,937.00 $1,294,867.00 $507,070.00 $423,450.00 $81,078.00 $43,500.00 NOLAN $693.00 $500.00 $193.00 $25.00 $168.00 $168.00 NUECES $40,768,626.00 $31,269,125.00 $9,821,323.00 $8,012,373.00 $1,783,796.00 $1,591,937.00 ORANGE $7,134.00 $1,500.00 $5,634.00 $300.00 $5,334.00 $5,334.00 PALO PINTO $922,804.00 $678,794.00 $244,010.00 $81,159.00 $162,540.00 $170,225.00 PARKER $75,137.00 $7,500.00 $67,637.00 $13,281.00 $54,356.00 $54,356.00 POLK $1,962,024.00 $1,606,950.00 $355,074.00 $251,358.00 $101,075.00 $134,813.00 POTTER $11,593,885.00 $8,801,949.00 $2,792,107.00 $2,540,209.00 $255,865.00 $254,609.00 RAINS $600.00 $300.00 $300.00 $75.00 $225.00 $225.00 REAL $6,544.00 $4,456.00 $2,088.00 $388.00 $1,700.00 $1,700.00 REFUGIO $2,786.00 $2,886.00 -$100.00 $50.00 -$150.00 $275.00 ROBERTSON $6,850.00 $3,548.00 $3,302.00 $125.00 $3,177.00 $3,177.00 RUNNELS $8,894.00 $4,335.00 $4,559.00 $100.00 $4,459.00 $4,788.00 SABINE $138,143.00 $108,333.00 $29,810.00 $24,807.00 $6,087.00 $3,313.00 SAN PATRICIO $188,595.00 $137,511.00 $51,084.00 $12,347.00 $38,833.00 $37,375.00 SCURRY $218,774.00 $172,754.00 $46,020.00 $0.00 $46,020.00 $0.00 SHELBY $450.00 $1,875.00 -$1,425.00 $228.00 -$1,653.00 $0.00 SMITH $5,739,945.00 $4,867,976.00 $871,969.00 $841,541.00 $21,606.00 $58,745.00 STARR $1,090,107.00 $882,592.00 $207,515.00 $164,745.00 $46,511.00 $58,159.00 TARRANT $53,990,677.00 $40,987,221.00 $13,003,591.00 $11,677,381.00 $1,295,732.00 $1,265,470.00 19

COUNTY GROSS RECEIPTS GROSS RECEIPTS, PRIZES AND CHARITABLE DISTRIBUTIONS BY COUNTY (CONT D) BINGO PRIZES TOTAL INCOME TOTAL EXPENSES NET PROCEEDS CHARITABLE DISTRIBUTIONS TAYLOR $12,754,788.00 $10,133,714.00 $2,716,444.00 $2,140,628.00 $561,342.00 $439,529.00 TOM GREEN $4,545,904.00 $3,438,720.00 $1,107,184.00 $1,007,946.00 $103,593.00 $52,983.00 TRAVIS $55,865,642.00 $42,473,792.00 $13,391,954.00 $11,046,052.00 $2,352,166.00 $2,164,498.00 TRINITY $609,729.00 $455,241.00 $154,498.00 $95,490.00 $61,440.00 $43,328.00 UPSHUR $1,316.00 $503.00 $813.00 $25.00 $788.00 $788.00 VAL VERDE $2,721,604.00 $1,797,941.00 $954,485.00 $674,555.00 $278,968.00 $271,899.00 VAN ZANDT $33,654.00 $28,388.00 $5,266.00 $7,411.00 -$2,008.00 $132.00 VICTORIA $7,282,623.00 $5,422,308.00 $1,860,315.00 $1,561,231.00 $295,579.00 $332,190.00 WALKER $14,467.00 $3,862.00 $10,605.00 $1,186.00 $9,419.00 $13,281.00 WASHINGTON $369,997.00 $276,466.00 $93,542.00 $79,032.00 $13,754.00 $17,919.00 WEBB $7,476,487.00 $5,478,101.00 $1,998,400.00 $1,522,832.00 $479,555.00 $441,176.00 WHARTON $738,405.00 $546,341.00 $192,085.00 $131,783.00 $60,862.00 $51,391.00 WICHITA $1,099,806.00 $850,409.00 $249,397.00 $245,505.00 -$6,881.00 $18,307.00 WILBARGER $0.00 $0.00 $0.00 $0.00 $0.00 $322.00 WILLIAMSON $7,642,408.00 $5,666,614.00 $2,000,294.00 $1,449,864.00 $551,532.00 $549,187.00 WILSON $22,425.00 $13,721.00 $8,704.00 $2,462.00 $5,667.00 $8,380.00 WISE $1,379.00 $732.00 $647.00 $50.00 $597.00 $597.00 WOOD $605,305.00 $443,014.00 $162,295.00 $124,533.00 $38,935.00 $24,000.00 ZAVALA $942,118.00 $719,855.00 $222,359.00 $91,923.00 $130,539.00 $112,704.00 WOOD $594,353.00 $434,429.00 $160,530.00 $130,027.00 $31,673.00 $28,196.00 ZAVALA $1,006,890.00 $744,346.00 $262,621.00 $90,683.00 $161,476.00 $162,892.00 TOTAL $761,488,986.00 $579,702,154.00 $183,190,970.00 $151,011,088.59 $31,808,346.41 $30,187,207.95 Source: Texas Lottery Commission. Figures as of 3/7/2017. Unaudited. 20

APPENDIX B CHARITABLE BINGO ALLOCATIONS TO COUNTIES AND PERCENTAGE OF CHANGE COUNTY 2015 2016 CHANGE % CHANGE BASTROP $8,280.11 $7,697.06 $-583.05-7.04% BELL $366,719.01 $354,730.63 $-11,988.38-3.27% BEXAR $1,493,540.60 $1,507,494.52 $13,953.92 0.93% BLANCO $30.00 $15.00 $-15.00-50.00% BOSQUE $110.87 $1,108.30 $997.43 899.64% BOWIE $61,563.60 $63,464.11 $1,900.51 3.09% BROWN $26,744.92 $21,085.68 $-5,659.24-21.16% BURNET $3,888.52 $4,310.30 $421.78 10.85% CALDWELL $58.02 $57.43 $-0.59-1.02% CAMERON $99,657.79 $98,490.29 $-1,167.50-1.17% CASTRO $20.29 $15.35 $-4.94-24.35% COMAL $9,350.74 $8,690.07 $-660.67-7.07% COMANCHE $97.73 $0.00 $-97.73-100.00% DALLAS $605,950.26 $633,713.19 $27,762.93 4.58% DEAF SMITH $43.01 $4.66 $-38.35-89.17% DENTON $20,391.31 $17,558.37 $-2,832.94-13.89% EASTLAND $5.35 $0.00 $-5.35-100.00% ECTOR $210,483.70 $165,337.86 $-45,145.84-21.45% EDWARDS $30.91 $27.52 $-3.39-10.97% EL PASO $57,971.70 $51,808.28 $-6,163.42-10.63% ELLIS $10,358.70 $9,178.05 $-1,180.65-11.40% FREESTONE $1,750.97 $11.40 $-1,739.57-99.35% FRIO $1,514.58 $1,144.49 $-370.09-24.44% GALVESTON $41,677.93 $67,964.30 $26,286.37 63.07% GILLESPIE $34.45 $0.00 $-34.45-100.00% GRAY $713.36 $745.51 $32.15 4.51% GRAYSON $21,872.72 $14,717.53 $-7,155.19-32.71% GREGG $103,210.30 $103,794.37 $584.07 0.57% GUADALUPE $73,782.73 $96,766.22 $22,983.49 31.15% HARRIS $758,748.73 $800,523.33 $41,774.60 5.51% HIDALGO $443,649.91 $454,376.90 $10,726.99 2.42% JACKSON $0.99 $0.00 $-0.99-100.00% KARNES $95.26 $1,479.23 $1,383.97 1,452.83% KAUFMAN $33,398.57 $38,866.14 $5,467.57 16.37% KENDALL $3.76 $3.93 $0.17 4.52% 21

CHARITABLE BINGO ALLOCATIONS TO COUNTIES AND PERCENTAGE OF CHANGE (CONT D) COUNTY 2015 2016 CHANGE % CHANGE KINNEY $221.19 $0.92 $-220.27-99.58% KLEBERG $6,001.42 $3,726.57 $-2,274.85-37.91% LIBERTY $5,594.53 $5,876.70 $282.17 5.04% LUBBOCK $274,564.98 $280,479.23 $5,914.25 2.15% LYNN $5,455.07 $2,508.52 $-2,946.55-54.01% MCLENNAN $198,103.68 $189,750.53 $-8,353.15-4.22% MIDLAND $127,409.68 $109,353.12 $-18,056.56-14.17% MONTAGUE $5.26 $0.00 $-5.26-100.00% MONTGOMERY $182,296.58 $162,450.61 $-19,845.97-10.89% NOLAN $43.00 $12.93 $-30.07-69.93% NUECES $393,479.06 $392,849.53 $-629.53-0.16% ORANGE $41.56 $19.73 $-21.83-52.53% PARKER $10.31 $185.00 $174.69 1,694.37% PECOS $139.11 $0.00 $-139.11-100.00% POTTER $211,415.30 $223,532.21 $12,116.91 5.73% RANDALL $8.50 $0.00 $-8.50-100.00% REEVES $8.97 $0.00 $-8.97-100.00% ROBERTSON $62.83 $86.83 $24.00 38.20% SAN PATRICIO $1,824.44 $1,718.41 $-106.03-5.81% SMITH $67,050.09 $53,564.02 $-13,486.07-20.11% STEPHENS $4.19 $0.00 $-4.19-100.00% TARRANT $514,075.33 $512,639.95 $-1,435.38-0.28% TAYLOR $138,286.64 $126,641.89 $-11,644.75-8.42% TOM GREEN $41,821.29 $42,995.32 $1,174.03 2.81% TRAVIS $471,757.77 $533,350.70 $61,592.93 13.06% UPSHUR $13.62 $0.27 $-13.35-98.02% VAL VERDE $45,197.03 $47,839.40 $2,642.37 5.85% VICTORIA $75,489.77 $67,801.66 $-7,688.11-10.18% WALLER $0.22 $0.00 $-0.22-100.00% WEBB $67,779.66 $68,450.70 $671.04 0.99% WILBARGER $1,383.56 $51.25 $-1,332.31-96.30% WILLIAMSON $126,941.09 $104,535.10 $-22,405.99-17.65% WINKLER $5.70 $-5.70 $-11.40-200.00% TOTAL $7,412,242.83 $7,455,595.42 $43,352.59 0.58% 22 Source: Texas Lottery Commission. Figures as of 3/7/2017. Unaudited.

APPENDIX C CHARITABLE BINGO ALLOCATIONS TO CITIES AND PERCENTAGE OF CHANGE CITY 2015 2016 CHANGE % CHANGE ABILENE $119,082.47 $108,504.51 $-10,577.96-8.88% ARLINGTON $84,025.22 $81,339.39 $-2,685.83-3.20% ASHERTON $2.94 $0.00 $-2.94-100.00% AUSTIN $465,047.55 $530,530.63 $65,483.08 14.08% AZLE $21.52 $56.09 $34.57 160.64% BAIRD $18.75 $0.00 $-18.75-100.00% BALCH SPRINGS $64,821.11 $68,562.31 $3,741.20 5.77% BANDERA $1,141.74 $1,243.15 $101.41 8.88% BANGS $4,522.57 $4,584.44 $61.87 1.37% BAYTOWN $40.44 $62.69 $22.25 55.02% BEAUMONT $75,815.64 $76,726.87 $911.23 1.20% BEDFORD $18.40 $0.00 $-18.40-100.00% BELLMEAD $49,900.75 $50,919.88 $1,019.13 2.04% BENBROOK $18.13 $0.00 $-18.13-100.00% BIG SPRING $17,196.12 $19,397.97 $2,201.85 12.80% BIG WELLS $23.45 $0.00 $-23.45-100.00% BOERNE $3.76 $3.92 $0.16 4.26% BOWIE $5.26 $0.00 $-5.26-100.00% BRACKETTVILLE $1.05 $0.00 $-1.05-100.00% BROWNSVILLE $83,187.64 $83,881.54 $693.90 0.83% BROWNWOOD $16,191.76 $16,457.16 $265.40 1.64% BRYAN $266,647.17 $258,216.86 $-8,430.31-3.16% BUDA $2,174.06 $2,288.06 $114.00 5.24% CAMP WOOD $19.32 $0.00 $-19.32-100.00% CARRIZO SPRINGS $5,907.33 $5,627.66 $-279.67-4.73% CLEBURNE $40,658.12 $41,402.34 $744.22 1.83% CLUTE $13.22 $0.00 $-13.22-100.00% COLLEGE STATION $42.85 $18.00 $-24.85-57.99% COLORADO CITY $0.35 $0.00 $-0.35-100.00% COMANCHE $97.72 $0.00 $-97.72-100.00% CONROE $118,421.72 $97,887.76 $-20,533.96-17.34% COPPERAS COVE $210,722.47 $205,287.60 $-5,434.87-2.58% CORPUS CHRISTI $393,413.63 $392,824.97 $-588.66-0.15% CROWLEY $6.59 $0.00 $-6.59-100.00% CRYSTAL CITY $14,943.43 $14,179.16 $-764.27-5.11% DALLAS $173,053.26 $181,813.21 $8,759.95 5.06% 23

CHARITABLE BINGO ALLOCATIONS TO CITIES AND PERCENTAGE OF CHANGE (CONT D) CITY 2015 2016 CHANGE % CHANGE 24 DENISON $7,146.53 $0.00 $-7,146.53-100.00% DENTON $20,364.90 $17,519.35 $-2,845.55-13.97% DEVINE $4,254.68 $3,378.53 $-876.15-20.59% DICKINSON $0.14 $0.00 $-0.14-100.00% EL PASO $57,971.55 $51,808.14 $-6,163.41-10.63% ELMENDORF $14.44 $25.20 $10.76 74.52% EVERMAN $19,328.76 $18,880.65 $-448.11-2.32% FAIRFIELD $1,750.94 $11.37 $-1,739.57-99.35% FARMERS BRANCH $5.38 $4.18 $-1.20-22.30% FORT WORTH $306,648.58 $308,301.69 $1,653.11 0.54% FREEPORT $2,795.99 $3,145.88 $349.89 12.51% GALVESTON $236.34 $241.47 $5.13 2.17% GARLAND $112,240.28 $114,173.11 $1,932.83 1.72% GRAND PRAIRIE $13,662.53 $25,409.03 $11,746.50 85.98% GUN BARREL CITY $23,420.07 $27,507.98 $4,087.91 17.45% HALTOM CITY $55.80 $0.39 $-55.41-99.30% HARKER HEIGHTS $50,965.14 $51,921.43 $956.29 1.88% HARLINGEN $5,078.71 $4,577.41 $-501.30-9.87% HELOTES $2,210.50 $2,235.09 $24.59 1.11% HEMPSTEAD $0.21 $0.00 $-0.21-100.00% HILLSBORO $39,050.91 $38,144.23 $-906.68-2.32% HOUSTON $212,423.83 $219,687.35 $7,263.52 3.42% HUMBLE $52,489.62 $52,356.61 $-133.01-0.25% HURST $42,818.81 $43,922.62 $1,103.81 2.58% INGLESIDE $1,687.57 $1,718.40 $30.83 1.83% IRVING $58,459.97 $58,713.74 $253.77 0.43% KATY $3,735.11 $3,385.71 $-349.40-9.35% KAUFMAN $0.04 $0.00 $-0.04-100.00% KILLEEN $203,483.91 $196,784.11 $-6,699.80-3.29% KINGSVILLE $5,960.07 $3,639.54 $-2,320.53-38.93% KIRBY $88.94 $0.00 $-88.94-100.00% LA FERIA $145.44 $147.27 $1.83 1.26% LA MARQUE $41,348.29 $67,593.66 $26,245.37 63.47% LA PORTE $20.94 $28.10 $7.16 34.19% LANCASTER $3,514.84 $0.00 $-3,514.84-100.00% LAREDO $67,779.40 $68,450.47 $671.07 0.99%

CHARITABLE BINGO ALLOCATIONS TO CITIES AND PERCENTAGE OF CHANGE (CONT D) CITY 2015 2016 CHANGE % CHANGE LEAGUE CITY $46.37 $35.89 $-10.48-22.60% LITTLE RIVER ACADEMY $4,471.75 $4,667.50 $195.75 4.38% LONGVIEW $103,159.82 $103,793.15 $633.33 0.61% LOS YBANEZ $0.31 $0.00 $-0.31-100.00% LUBBOCK $274,564.35 $265,335.09 $-9,229.26-3.36% LULING $73.75 $41.78 $-31.97-43.35% MARBLE FALLS $3,820.57 $4,310.28 $489.71 12.82% MERCEDES $6,699.63 $6,411.95 $-287.68-4.29% MESQUITE $42,058.17 $42,348.22 $290.05 0.69% MEXIA $2.49 $0.00 $-2.49-100.00% MIDLAND $127,409.47 $109,352.98 $-18,056.49-14.17% ODESSA $95,218.27 $85,638.51 $-9,579.76-10.06% ORANGE $38.30 $19.73 $-18.57-48.49% PALACIOS $77.60 $44.25 $-33.35-42.98% PARIS $27,057.03 $26,239.60 $-817.43-3.02% PASADENA $9,544.75 $33.43 $-9,511.32-99.65% PHARR $82,214.10 $82,436.10 $222.00 0.27% PLANO $79,601.84 $85,463.67 $5,861.83 7.36% PRESIDIO $39.09 $0.00 $-39.09-100.00% RICHARDSON $43,261.47 $43,676.72 $415.25 0.96% RISING STAR $5.35 $0.00 $-5.35-100.00% ROBSTOWN $39.48 $23.61 $-15.87-40.20% ROMA $21,884.57 $22,175.10 $290.53 1.33% ROUND ROCK $38,141.45 $38,298.25 $156.80 0.41% SAN ANGELO $41,768.17 $42,951.34 $1,183.17 2.83% SAN ANTONIO $1,316,504.04 $1,336,224.36 $19,720.32 1.50% SAN BENITO $4,120.05 $4,052.74 $-67.31-1.63% SAN JUAN $34,756.46 $34,616.44 $-140.02-0.40% SANSOM PARK $0.02 $0.00 $-0.02-100.00% SCHERTZ $103.75 $31.25 $-72.50-69.88% SEABROOK $28.74 $14.37 $-14.37-50.00% SEGUIN $29,961.00 $25,725.73 $-4,235.27-14.14% SEVEN POINTS $10.47 $0.00 $-10.47-100.00% SHERMAN $18,916.24 $14,687.04 $-4,229.20-22.36% SOMERVILLE $23.62 $0.00 $-23.62-100.00% SOUTH HOUSTON $56,758.57 $57,982.27 $1,223.70 2.16% 25

CHARITABLE BINGO ALLOCATIONS TO CITIES AND PERCENTAGE OF CHANGE (CONT D) CITY 2015 2016 CHANGE % CHANGE TEMPLE $23,147.54 $22,022.25 $-1,125.29-4.86% TOMBALL $10.33 $60.07 $49.74 481.51% TRINIDAD $2,777.04 $7.70 $-2,769.34-99.72% TUSCOLA $91.13 $0.00 $-91.13-100.00% TYE $19,104.12 $18,137.26 $-966.86-5.06% TYLER $67,043.70 $53,445.89 $-13,597.81-20.28% UNIVERSAL CITY $235.23 $225.80 $-9.43-4.01% UVALDE $25.81 $0.50 $-25.31-98.06% VICTORIA $75,488.54 $67,801.60 $-7,686.94-10.18% WACO $144,369.02 $134,667.71 $-9,701.31-6.72% WATAUGA $25,913.19 $26,509.54 $596.35 2.30% WESLACO $4,516.92 $4,135.17 $-381.75-8.45% WEST $52.79 $4.18 $-48.61-92.08% WEST LAKE HILLS $34.18 $30.34 $-3.84-11.23% WEST TAWAKONI $1.91 $0.00 $-1.91-100.00% WHITE SETTLEMENT $34,975.04 $33,337.61 $-1,637.43-4.68% WICHITA FALLS $32,983.15 $34,228.41 $1,245.26 3.78% TOTAL $6,461,517.42 $6,456,774.26 $-4,743.16-0.07% Source: Texas Lottery Commission. Figures as of 3/7/2017. Unaudited. 26