Ridiculous rake - Starting a legal poker game

[binions]

After a rash of hijackings and a couple of police busts, Houston underground poker games are raking the hell out of it. 10% up to $25 or $35 per hand in 5-10 and even 5-5 games NL and PL games. $300-500 is coming off the table every hour, and a few of us are getting sick and tired of it.

In Texas, it is a defense to gambling that:

(1) the actor engaged in gambling in a private place;

(2) no person received any economic benefit other than personal winnings; and

(3) except for the advantage of skill or luck, the risks of losing and the chances of winning were the same for all participants.

See Section 47.02 of the Texas Criminal Code. In this way, a group of friends getting together at someone's house to play cards is a defense to a gambling charge so long as the house makes no money from hosting the game.

However, prosecutors have busted taverns for hosting no-rake poker tournaments in Texas because, while the house did not receive rake, they did receive increased beer sales as a result of hosting the tournament. In Texas, they take the "no economic benefit" to the house requirement pretty seriously.

But what about a nonprofit association? This is my idea. By definition, a nonprofit association makes no profit. There are many forms it might take. It does not have to be tax exempt or 501c3.

As it turns out, Chapter 252 of the Texas Business Organization Code provides for Unincorporated Nonprofit Associations. All that's required is 3+ members and that it keep books and records that are available for inspection by the members. It can do some other things voluntarily, like appoint an agent for service of process or file a statement or authority with respect to real property or file a d/b/a, but 3 members and open books are the only requirements.

http://tlo2.tlc.state.tx.us/statutes....000252.00.pdf

So, some of my friends and I are thinking of starting, say, the "Houston Poker Co-op," an unincorporated nonprofit association. Additional members (i.e. players) will be invited to apply to join. In other words, the Co-op will be private in nature.

We'll probably start in a hotel room, eventually hope to rent an apartment or loft. In other words, the games will be held in private places.

Here's how it will work. Players can buy in for cash, check or credit card. Co-op dues will be collected on each buy-in. 5% on cash buy-ins, and 8% on check/credit card buy ins. You buy in for $500 cash, you get $475 in chips. No pot will be raked.

Club dues go to operating expenses, like rent, playing cards, chips, food. At the end of every quarter, if there is a surplus, the Co-op will host a poker freeoll tournament and give away the excess funds back to its members. In this way, the "house" makes zero profit, only getting its expenses reimbursed.

We do plan to have dealers at the games, who work on tips alone. Perhaps a game girl who works on tips.

Thoughts? Will it fly?