(a) 
A person commits an offense if he operates a sexually oriented business without a valid license, issued by the town for the particular type of business.
(b) 
An application for a license must be made on a form provided by the town secretary. The application must be accompanied by a sketch or diagram showing the configuration of the premises, including a statement of total floor space occupied by the business. The sketch or diagram need not be professionally prepared but must be drawn to a designated scale or drawn with marked dimensions of the interior of the premises to an accuracy of plus or minus six inches. Applicants who must comply with section 5.07.067 of this article shall submit a diagram meeting the requirements of section 5.07.067.
(c) 
The applicant must be qualified according to the provisions of this article.
(d) 
If a person who wishes to operate a sexually oriented business is an individual, he must sign the application for a license as applicant. If a person who wishes to operate a sexually oriented business is other than an individual, each individual who has a 20 percent or greater interest in the business must sign the application for a license as applicant. Each applicant must be qualified under section 5.07.032 of this article and each applicant shall be considered a licensee if a license is granted.
(e) 
The fact that a person possesses a valid town license for any other business or commercial operation does not exempt him from the requirement of obtaining a sexually oriented business license. A person who operates a sexually oriented business and possesses a town license for any other business or commercial operation shall comply with the requirements and provisions of this article as well as all other town ordinance requirements, when applicable.
(1999 Code, sec. 4.404)
(a) 
The chief of police shall approve the issuance of a license by the town secretary to an applicant within 30 days after receipt of an application unless the chief of police finds one or more of the following to be true:
(1) 
An applicant is under 18 years of age.
(2) 
An applicant or an applicant’s spouse is overdue in payment to the town of taxes, fees, fines, or penalties assessed against or imposed upon the applicant or the applicant’s spouse in relation to a sexually oriented business.
(3) 
An applicant has failed to provide information reasonably necessary for issuance of the license or has falsely answered a question or request for information on the application form.
(4) 
An applicant or an applicant’s spouse has been convicted of a violation of a provision of this article, other than the offense of operating a sexually oriented business without a license, within two years immediately preceding the application. The fact that a conviction is being appealed shall have no effect.
(5) 
The license fee required by this article has not been paid.
(6) 
An applicant has been employed in a sexually oriented business in a managerial capacity within the preceding 12 months and has demonstrated an inability to operate or manage a sexually oriented business premises in a peaceful and law-abiding manner, thus necessitating action by law enforcement officers.
(7) 
An applicant or the proposed establishment is in violation of or is not in compliance with section 5.07.034, 5.07.039, 5.07.061, 5.07.063, 5.07.064, 5.07.065, 5.07.066, 5.07.067, or 5.07.068 of this article.
(8) 
An applicant or an applicant’s spouse has been convicted of a crime:
(A) 
Involving:
(i) 
Any of the following offenses as described in chapter 43 of the Texas Penal Code:
a. 
Prostitution;
b. 
Promotion of prostitution;
c. 
Aggravated promotion of prostitution;
d. 
Compelling prostitution;
e. 
Obscenity;
f. 
Sale, distribution, or display of harmful material to a minor;
g. 
Sexual performance by a child;
h. 
Possession of child pornography;
(ii) 
Any of the following offenses as described in chapter 21 of the Texas Penal Code:
a. 
Public lewdness;
b. 
Indecent exposure;
c. 
Indecency with a child;
(iii) 
Sexual assault or aggravated sexual assault as described in chapter 22 of the Texas Penal Code;
(iv) 
Incest, solicitation of a child, as described in chapter 25 of the Texas Penal Code; or
(v) 
Criminal attempt, conspiracy, or solicitation to commit any of the foregoing offenses;
(B) 
For which:
(i) 
Less than two years have elapsed since the date of conviction or the date of release from confinement imposed for the conviction, whichever is the later date, if the conviction is of a felony offense; or
(ii) 
Less than five years have elapsed since the date of the last conviction or the date of release from confinement for the last conviction, whichever is the later date, if the convictions are of two or more misdemeanor offenses or combination of offenses occurring within any 24-month period.
(b) 
The fact that a conviction is being appealed shall have no effect on the disqualification of the applicant or applicant’s spouse.
(c) 
An applicant who has been convicted or whose spouse has been convicted of an offense listed in subsection (a)(8) of this section may qualify for a sexually oriented business license only when the time period required by subsection (a)(8)(B) has elapsed.
(d) 
The license, if granted, shall state on its face the name of the person or persons to whom it is granted, the expiration date, and the address of the sexually oriented business. The license shall be posted in a conspicuous place at or near the entrance to the sexually oriented business so that it may be easily read at any time.
(1999 Code, sec. 4.405)
The annual fee for a sexually oriented business license is as provided for in the fee schedule found in appendix A of this code.
(1999 Code, sec. 4.406)
(a) 
An applicant or licensee shall permit the building inspector or chief of police or other representative designated by the town council to perform such duty to inspect the premises of a sexually oriented business for the purpose of insuring compliance with the law, at any time it is occupied or open for business.
(b) 
A person who operates a sexually oriented business or his agent or employee commits an offense if he refuses to permit a lawful inspection of the premises by a representative designated by the town council to perform such duty at any time it is occupied or open for business.
(c) 
The provisions of this section do not apply to areas of an adult motel which are currently being rented by a customer for use as a permanent or temporary habitation.
(1999 Code, sec. 4.407)
Each license shall expire one year from the date of issuance and may be renewed only by making application as provided in section 5.07.031. Application for renewal should be made at least 30 days before the expiration date, and when made less than 30 days before the expiration date the expiration of the license will not be affected.
(1999 Code, sec. 4.408)
The chief of police shall suspend a license for a period not to exceed 30 days if he determines that a licensee or an employee of a licensee has:
(1) 
Violated or is not in compliance with section 5.07.034, 5.07.039, 5.07.061, 5.07.063, 5.07.064, 5.07.065, 5.07.066, 5.07.067, or 5.07.068 of this article;
(2) 
Engaged in excessive use of alcoholic beverages while on the sexually oriented business premises;
(3) 
Refused to allow an inspection of the sexually oriented business premises as authorized by this article;
(4) 
Knowingly permitted gambling by any person on the sexually oriented business premises;
(5) 
Demonstrated inability to operate or manage a sexually oriented business in a peaceful and law-abiding manner thus necessitating action by law enforcement officers.
(1999 Code, sec. 4.409)
(a) 
The chief of police shall revoke a license if a cause of suspension in section 5.07.036 occurs and the license has been suspended within the preceding 12 months.
(b) 
The chief of police shall revoke a license if the chief of police determines that:
(1) 
A licensee gave false or misleading information in the material submitted to the chief of police during the application process;
(2) 
A licensee or an employee has knowingly allowed possession, use, or sale of controlled substances on the premises;
(3) 
A licensee or an employee has knowingly allowed prostitution on the premises;
(4) 
A licensee or an employee has knowingly operated the sexually oriented business during a period of time when the licensee’s license was suspended;
(5) 
A licensee has been convicted of an offense listed in [section 5.07.032(a)(8)(A) and the time period required by] section 5.07.032(a)(8)(B) has not elapsed;
(6) 
On two or more occasions within a 12-month period, a person or persons committed an offense occurring in or on the licensed premises of a crime listed in section 5.07.032(a)(8)(A), for which a conviction has been obtained, and the person or persons were employees of the sexually oriented business at the time the offenses were committed;
(7) 
A licensee or an employee has knowingly allowed any act of sexual intercourse, sodomy, oral copulation, masturbation, or sexual contact to occur in or on the licensed premises. The term “sexual contact” shall have the same meaning as it is defined in section 21.01, Texas Penal Code; or
(8) 
A licensee is delinquent in payment to the town for hotel occupancy taxes, ad valorem taxes, or sales taxes related to the sexually oriented business.
(c) 
The fact that a conviction is being appealed shall have no effect on the revocation of the license.
(d) 
Subsection (b)(7) does not apply to adult motels as grounds for revoking the license unless the licensee or employee knowingly allowed the act of sexual intercourse, sodomy, oral copulation, masturbation, or sexual contact to occur in a public place or within public view.
(e) 
When the chief of police revokes a license, the revocation shall continue for one year and the licensee shall not be issued a sexually oriented business license for one year from the date revocation became effective. If, subsequent to revocation, the chief of police finds that the basis for the revocation has been corrected or abated, the applicant may be granted a license if at least 90 days have elapsed since the date the revocation became effective. If the license was revoked under subsection (b)(5), an applicant may not be granted another license until the appropriate number of years required under section 5.07.032(a)(8)(B) has elapsed.
(1999 Code, sec. 4.410)
If the chief of police denies the issuance of a license, or suspends or revokes a license, the chief of police shall send to the applicant or licensee, by certified mail, return receipt requested, written notice of the action and the right to an appeal. Upon receipt of written notice of the denial, suspension, or revocation, the licensee whose application for a license has been denied or whose license has been suspended or revoked shall have the right to appeal to the state district court. An appeal to the state district court must be filed within 30 days after the receipt of notice of the decision of the chief of police. The licensee shall bear the burden of proof in court.
(1999 Code, sec. 4.411)
A licensee shall not transfer such license to another, nor shall a licensee operate a sexually oriented business under the authority of a license at any place other than the address designated in the application.
(1999 Code, sec. 4.412)