PRINTER'S NO.  61

  

THE GENERAL ASSEMBLY OF PENNSYLVANIA

  

HOUSE BILL

 

No.

169

Session of

2011

  

  

INTRODUCED BY DELOZIER, SWANGER, BARRAR, BUXTON, FLECK, GINGRICH, GRELL, GROVE, HARKINS, KAUFFMAN, M.K. KELLER, LONGIETTI, MATZIE, MILLARD, MILLER, OBERLANDER, QUINN, REICHLEY, ROCK, SAINATO, SONNEY AND VULAKOVICH, JANUARY 19, 2011

  

  

REFERRED TO COMMITTEE ON GAMING OVERSIGHT, JANUARY 19, 2011  

  

  

  

AN ACT

  

1

Amending the act of December 19, 1988 (P.L.1262, No.156),

2

entitled, as amended, "An act providing for the licensing of

3

eligible organizations to conduct games of chance, for the

4

licensing of persons to distribute games of chance, for the

5

registration of manufacturers of games of chance, and for

6

suspensions and revocations of licenses and permits;

7

requiring records; providing for local referendum by

8

electorate; and prescribing penalties," further providing for

9

definitions, for permitted games of chance, for prize limits,

10

for insured games, for limited sales, for recordkeeping, for

11

eligible organizations' use of locations for conducting small

12

games of chance, for separate individual prize limitations,

13

for enforcement and for advertising.

14

The General Assembly of the Commonwealth of Pennsylvania

15

hereby enacts as follows:

16

Section 1.  The definitions of "daily drawing" and "games of

17

chance" in section 3 of the act of December 19, 1988 (P.L.1262,

18

No.156), known as the Local Option Small Games of Chance Act,

19

amended December 19, 1990 (P.L.812, No.195) and October 18, 2000

20

(P.L.602, No.79), are amended and the section is amended by

21

adding definitions to read:

22

Section 3.  Definitions.

 


1

The following words and phrases when used in this act shall

2

have the meanings given to them in this section unless the

3

context clearly indicates otherwise:

4

* * *

5

"Daily drawing."  A game in which a bona fide member selects

6

or is assigned a number for a chance at a prize with the winner

7

determined by [a] random drawing to take place on the eligible

8

organization's premises [during the same operating day]. The

9

term includes games commonly known as "member sign-in lotteries"

10

and "half-and-half lotteries." Nothing in this act shall be

11

construed to prohibit the carrying over of a jackpot where the

12

winning number has not been entered in the game on a particular

13

operating day. Daily drawing winners may be determined with the

14

aid of a passive selection device or reference to drawings

15

conducted by the department pursuant to the act of August 26,

16

1971 (P.L.351, No.91), known as the State Lottery Law. Daily

17

drawing chances may not be sold for an amount in excess of $1,

18

and no more than one chance per individual may be sold [to an

19

individual during the same operating day.] per drawing. Nothing

20

in this definition shall restrict an eligible organization from

21

conducting more than one drawing per day.

22

* * *

23

"Games of chance."  Punchboards, daily drawings, weekly

24

drawings, monthly drawings, raffles and pull-tabs, as defined in

25

this act, provided that no such game shall be played by or with

26

the assistance of any mechanical or electrical devices or media

27

other than a dispensing machine or passive selection device and

28

further provided that the particular chance taken by any person

29

in any such game shall not be made contingent upon any other

30

occurrence or the winning of any other contest, but shall be

- 2 -

 


1

determined solely at the discretion of the purchaser. This

2

definition shall not be construed to authorize any other form of

3

gambling currently prohibited under any provision of Title 18 of

4

the Pennsylvania Consolidated Statutes (relating to crimes and

5

offenses). Nothing in this act shall be construed to authorize

6

games commonly known as "slot machines" or "video poker."

7

"General operating expenses."  The following operating

8

expenses associated with the real property owned or leased by an

9

eligible organization and used for public interest purposes or

10

for conducting small games of chance:

11

(1)  Real property taxes.

12

(2)  Utilities.

13

(3)  Heating and air conditioning.

14

(4)  Water and sewer.

15

(5)  Property insurance.

16

(6)  Liability insurance.

17

(7)  Mortgage payments.

18

(8)  Interior and exterior repairs, including parking lot

19

repairs.

20

(9)  New facility construction.

21

(10)  Any other expense as provided in regulations

22

promulgated by the department.

23

The term shall not include wages, alcohol purchases or payment

24

of any fine levied against the eligible organization.

25

* * *

26

"Monthly drawing."  A game in which a bona fide member

27

selects or receives a number or numbers for chance at a prize

28

with the winner determined by a random drawing to take place on

29

the eligible organization's premises during any operating month.

30

Nothing in this act shall be construed to prohibit the carrying

- 3 -

 


1

over of a jackpot where the winning number has not been entered

2

in the game in a particular month. Monthly drawing winners may

3

be determined with the aid of a passive selection device or

4

reference to drawings conducted by the Department of Revenue

5

pursuant to the act of August 26, 1971 (P.L.351, No.91), known

6

as the State Lottery Law. Monthly drawing chances may not be

7

sold for an amount in excess of $1.

8

* * *

9

Section 2.  Section 4 of the act, amended December 19, 1990

10

(P.L.812, No.195), is amended to read:

11

Section 4.  Games of chance permitted.

12

Every eligible organization to which a license has been

13

issued under the provisions of this act may conduct games of

14

chance for the purpose of raising funds for general operating

15

expenses and for public interest purposes. [All proceeds of

16

games of chance shall be used exclusively for public interest

17

purposes or for the purchase of games of chance as permitted by

18

this act.] Proceeds of games of chance shall be used as follows:

19

(1)  Sixty percent of proceeds shall be used for public

20

interest purposes.

21

(2)  Forty percent of proceeds shall be used for general

22

operating expenses.

23

Section 3.  Section 5 of the act, amended December 19, 1990

24

(P.L.812, No.195) and October 18, 2000 (P.L.602, No.79), is

25

amended to read:

26

Section 5.  Prize limits.

27

(a)  Individual prize limit.--[The] Except as provided for in

28

subsection (j), the maximum cash value which may be awarded for

29

any single chance shall be [$500] $1,000.

30

(b)  Weekly limit.--No more than [$5,000] $25,000 in cash or

- 4 -

 


1

merchandise shall be awarded by any eligible organization in any

2

seven-day period. Payouts of less than $26 shall not be counted

3

toward the weekly limit.

4

(c)  Limit on raffles.--No more than $5,000 in cash or

5

merchandise shall be awarded in raffles in any calendar month.

6

(d)  Exception.--An eligible organization may conduct a

7

raffle and award a prize or prizes valued in excess of [$500] 

8

$1,000 each only under the following conditions:

9

(1)  The licensing authority has issued a special permit

10

for the raffle under section 11.

11

(2)  Eligible organizations shall be eligible to receive

12

no more than [two] three special permits in any licensed year

13

[except that volunteer fire, ambulance and rescue

14

organizations shall be eligible to receive no more than three

15

special permits in any licensed year].

16

(3)  Only one raffle may be conducted under each special

17

permit.

18

(4)  The total cash value of all prizes shall be no more

19

than $100,000 per calendar year.

20

(e)  Limit on daily drawings.--Daily drawings shall be

21

governed by the prize [limitations] limitation contained in

22

[subsections (a) and (b)] subsection (a). [An eligible

23

organization shall not conduct daily drawings during a period

24

when a weekly drawing is taking place.]

25

(f)  Exception.--The prize limitation contained in

26

[subsections (a) and (b)] subsection (a) may be exceeded by a

27

daily drawing under the following circumstances: a daily drawing

28

may award a prize where the cash value is in excess of [$500] 

29

$1,000 if such prize is the result of a carryover of a drawing

30

or drawings which resulted from the winning number in such

- 5 -

 


1

drawing or drawings not being among the eligible entrants in

2

such drawings. Nothing contained herein shall authorize the

3

prize [limitations] limitation as contained in [subsections (a)

4

and (b)] subsection (a) to be exceeded as a result of a failure

5

to conduct a drawing on an operating day during which chances

6

were sold for a daily drawing or for a daily drawing for which

7

chances were sold in excess of $1 or for which more than one

8

chance was sold to an eligible participant.

9

(g)  Daily drawing and weekly drawing exception.--When a

10

daily drawing or weekly drawing is set up or conducted in such a

11

manner as to pay out or award 100% of the gross revenues

12

generated from such drawing, the limitations contained in

13

subsection (b) shall not apply.

14

(h)  Limit on weekly drawings.--Weekly drawings shall be

15

governed by the prize limitations contained in subsection (b).

16

The prize limitation contained in subsection (b) may be exceeded

17

by a weekly drawing under the following circumstances: a weekly

18

drawing may award a prize where the cash value is in excess of

19

[$5,000] $25,000 if such prize is the result of a carryover of a

20

drawing or drawings which resulted from the winning number or

21

numbers in such drawing or drawings not being among the eligible

22

entrants in such drawings. Nothing contained in this act shall

23

authorize the prize limitations as contained in subsection (b)

24

to be exceeded as a result of a failure to conduct a drawing for

25

a week during which chances were sold for a weekly drawing or

26

for a weekly drawing for which chances were sold in excess of

27

$1. [An eligible organization shall not conduct weekly drawings

28

during a period when a daily drawing is taking place.]

29

(i)  Limit on monthly drawings.--No more than $50,000 in cash

30

or merchandise may be awarded in any calendar month except under

- 6 -

 


1

the following circumstances: a monthly drawing may award a prize

2

where the cash value is in excess of $50,000 if the prize is the

3

result of a carryover of a drawing or drawings that resulted

4

from the winning number or numbers in the drawing or drawings

5

not being among the eligible entrants in the drawing. Nothing

6

contained in this act shall authorize the prize limitations to

7

be exceeded as a result of a failure to conduct a drawing for a

8

month during which chances were sold for a monthly drawing or

9

for a monthly drawing for which chances were sold in excess of

10

$1.

11

(j)  Authorization.--Progressive games shall be permitted

12

with a maximum cash value of $5,000. Contributions to the pot

13

shall be counted against the limit for the week in which the

14

contribution is made except that when the limit is reached the

15

amount awarded shall be counted toward the limit only to the

16

extent it was not previously counted toward a prior week's

17

limit.

18

(k)  Emergency services fundraiser.--Notwithstanding any

19

other provision of this section, an eligible organization that

20

performs emergency services shall be permitted to conduct one

21

drawing per year with an award of $50,000 for the purpose of

22

raising funds to purchase emergency services equipment.

23

(l)  Definition.--As used in this section, the term

24

"progressive game" means a game of chance in which a winning

25

ticket awards the ticketholder an additional chance at another

26

game of chance.

27

Section 4.  The act is amended by adding a section to read:

28

Section 5.1.  Insured games.

29

(a)  Authorization.--Notwithstanding any provision of this

30

act to the contrary, an eligible organization may conduct small

- 7 -

 


1

games of chance using insured games. Insured games sold by a

2

licensed distributor shall be insured by a valid insurance

3

contract issued by an insurance company licensed by the

4

Insurance Department to do business as an insurance company in

5

this Commonwealth. Proof of the insurance contract must be

6

provided to the department prior to the game being sold. The

7

license of a distributor and an insurance company issuing a

8

contract for an insured game may be suspended or revoked for

9

failure to pay an award.

10

(b)  Definition.--As used in this section, the term "insured

11

game" means a game of chance in which the distributor or other

12

licensed third party guarantees making the payment on a win of a

13

jackpot.

14

Section 5.  Section 6 of the act, amended December 19, 1990

15

(P.L.812, No.195), is amended to read:

16

Section 6.  Sales limited.

17

No person shall sell, offer for sale or furnish games of

18

chance for use within this Commonwealth except to an eligible

19

organization or distributor licensed under this act. No game of

20

chance, other than a raffle, sold, offered for sale or furnished

21

for use within this Commonwealth shall contain, permit, depict

22

or designate a prize having a cash value in excess of [$500] 

23

$1,000.

24

Section 6.  Section 9(b) of the act, amended December 19,

25

1990 (P.L.812, No.195), is amended to read:

26

Section 9.  Regulations of department.

27

* * *

28

(b)  Limitation on recordkeeping requirements.--This section

29

shall not be construed to authorize the department to promulgate

30

regulations providing for recordkeeping requirements for

- 8 -

 


1

eligible organizations which require unreasonable or unnecessary

2

information or a repetitious listing of information. The

3

department shall strive to keep such recordkeeping requirements

4

from being an undue hardship or burden on eligible

5

organizations. Under no circumstances shall the department

6

require the retention of records for a period in excess of [two

7

years] one year. Each eligible organization shall report to the

8

department prizes awarded as required by section 335 of the act

9

of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of

10

1971.

11

Section 7.  Section 10 of the act, amended December 19, 1990

12

(P.L.812, No.195) and October 18, 2000 (P.L.602, No.79), is

13

amended to read:

14

Section 10.  Licensing of eligible organizations to conduct

15

games of chance.

16

(a)  License required.--No eligible organization shall

17

conduct or operate any games of chance unless such eligible

18

organization has obtained and maintains a valid license issued

19

pursuant to this section. Auxiliary groups within eligible

20

organizations shall be eligible to conduct small games of chance

21

using the license issued to the eligible organization provided

22

that the auxiliary group or groups are listed on the application

23

and license of the eligible organization. No additional

24

licensing fee shall be charged for an auxiliary group's

25

eligibility under this act. Auxiliary groups shall not include

26

branches, lodges or chapters of a Statewide organization.

27

(b)  Issuance and fees.--The licensing authority shall

28

license, upon application, within 30 days any eligible

29

organization meeting the requirements for licensure contained in

30

this act to conduct and operate games of chance at such

- 9 -

 


1

locations within the county or in such manner as stated on the

2

application as limited by subsection (b.1). The license fee to

3

be charged to each eligible organization shall be [$100] $300,

4

except for limited occasion licenses which shall be [$10] $30.

5

Licenses shall be renewable [annually] on a biennial basis upon

6

the anniversary of the date of issue.

7

(b.1)  Location of small games of chance.--Where there exists

8

a location or premises which is the normal business or operating

9

site of the eligible organization and is owned or leased by that

10

eligible organization to conduct its normal business, that site

11

shall be the licensed premises for small games of chance

12

conducted by the eligible organization. If that location

13

consists of more than one building and the eligible organization

14

wishes to conduct its games in a different building at that

15

location from the one that is listed on its application and

16

license, the eligible organization must notify, in writing, the

17

district attorney and the licensing authority of the change in

18

building site and the dates and times that will be affected.

19

When an eligible organization does not own or lease a specific

20

location to conduct its normal business, that eligible

21

organization may use another eligible organization's premises to

22

conduct its games or may make such other arrangements that are

23

consistent with this act, including, but not limited to, leasing

24

a premise under a written agreement for a rental which is not

25

determined by either the amount of receipts realized from the

26

playing of games of chance nor the number of people attending

27

except that an eligible organization may lease a facility for a

28

banquet where a per head charge is applied in connection with

29

the serving of a meal. When such eligible organization changes

30

the site of its games from that which is listed on its

- 10 -

 


1

application and license, the eligible organization must notify,

2

in writing, the district attorney and licensing authority of the

3

change in their games' site and dates and times that will be

4

affected. More than one eligible organization may use the same

5

location, provided that each eligible organization has a

6

separate license. If more than one licensed eligible

7

organization uses the same location, the prize limitations of

8

this act shall apply to each licensed eligible organization.

9

(b.2)  Off-premises games of chance.--Notwithstanding any

10

other provisions of this section, an eligible organization may

11

conduct small games of chance at a location off its premises

12

when such games are part of an annual carnival, fair, picnic or

13

banquet held or participated in by that eligible organization on

14

a historical basis. The eligible organization must notify, in

15

writing, the district attorney and licensing authority of the

16

location, date and times of such events where it will be

17

conducting small games of chance.

18

(b.3)  Limited occasion licenses.--Eligible organizations

19

which do not own their own premises or which do not lease a

20

specific location to conduct their normal business may apply for

21

a limited occasion license to conduct small games of chance on

22

not more than three occasions covering a total of seven days

23

during a licensed year. A limited occasion license entitles

24

eligible organizations holding such a license to conduct no more

25

than two raffles during a licensed year where prizes may not

26

exceed the established limits for regular monthly raffles.

27

Holders of limited occasion licenses may not apply or be granted

28

any other license or special permit under this act. No holder of

29

a regular license or special permit under this act shall apply

30

or be granted a limited occasion license.

- 11 -

 


1

(b.4)  Gambling facility prohibited.--It shall be unlawful

2

for a person, corporation, association, partnership or other

3

business entity to offer for rent or offer for use a building or

4

facility to be used exclusively for the conducting of small

5

games of chance. It shall also be unlawful for any eligible

6

organization to lease under any terms a facility or building

7

which is used exclusively for the conducting of small games of

8

chance.

9

(b.5)  Authorization.--A licensed eligible organization may

10

sell on its licensed premises the raffle tickets of another

11

licensed eligible organization that has been issued a limited

12

occasion license under subsection (b.3).

13

(c)  Display.--Licenses issued pursuant to this section shall

14

be publicly displayed at the site of the small games of chance.

15

(d)  Operation.--Each licensed eligible organization shall

16

comply with the following restrictions and rules governing the

17

operation of games of chance:

18

(1)  No person under 18 years of age shall be permitted

19

to operate or play games of chance.

20

(2)  No eligible organization shall permit any person who

21

has been convicted of a felony in a Federal or State court

22

within the past five years or has been convicted in a Federal

23

or State court within the past ten years of a violation of

24

the act of July 10, 1981 (P.L.214, No.67), known as the Bingo

25

Law, or of this act to manage, set up, supervise or

26

participate in the operation of games of chance.

27

(3)  No eligible organization shall pay any compensation

28

to any person for conducting any games of chance. Games of

29

chance may only be conducted by managers, officers,

30

directors, bar personnel and bona fide members of the

- 12 -

 


1

eligible organization.

2

(4)  Games shall be conducted only on the licensed

3

premises or as otherwise provided by this act.

4

(5)  The eligible organization shall not lease such

5

premises under either an oral or a written agreement for a

6

rental which is determined by either the amount of receipts

7

realized from the playing of games of chance or the number of

8

people attending, except that an eligible organization may

9

lease a facility for a banquet where a per head charge is

10

applied in connection with the serving of a meal. An eligible

11

organization shall not lease such premises from any person

12

who has been convicted of a violation of this act within the

13

past ten years.

14

(6)  Games, other than raffles, daily drawings [and], 

15

weekly drawings and monthly drawings, shall be purchased only

16

from manufacturers and distributors approved by the

17

department.

18

(7)  No licensed eligible organization shall permit its

19

premises to be used for small games of chance by another

20

licensed eligible organization at the same time that it is

21

conducting small games of chance on the premises. When a

22

licensed eligible organization is permitting another licensed

23

eligible organization to use its premises for purposes of

24

small games of chance, it must cease the operation of its own

25

small games of chance during the period that the other

26

licensed eligible organization is conducting its games on the

27

premises.

28

(8)  Raffle tickets may be sold off the licensed premise

29

in any municipality in this Commonwealth which has adopted

30

the provisions of this act by an affirmative vote in a

- 13 -

 


1

municipal referendum. A licensed eligible organization which

2

plans to sell raffle tickets in a municipality located in a

3

county other than the county in which the eligible

4

organization is licensed must notify that county's district

5

attorney and licensing authority as to the location and the

6

dates that the eligible organization plans to sell raffle

7

tickets.

8

(9)  The eligible organization shall keep a bank account

9

to hold the proceeds of small games of chance, which shall be

10

separate from all other funds belonging to the eligible

11

organization. Account records shall show all expenditures and

12

income, and these records shall be retained by the eligible

13

organization for no less than one year in a fire-proof

14

container.

15

(e)  Application for license.--Each eligible organization

16

shall apply to the licensing authority for a license on a form

17

to be prescribed by the Secretary of Revenue. The form shall

18

contain an affidavit to be affirmed by the executive officer or

19

secretary of the eligible organization stating that:

20

(1)  No person under 18 years of age will be permitted by

21

the eligible organization to operate or play games of chance.

22

(2)  The facility in which the games of chance are to be

23

played has adequate means of ingress and egress and adequate

24

sanitary facilities available in the area.

25

(3)  The eligible organization is not leasing such

26

premises from the owner thereof under an oral agreement, nor

27

is it leasing such premises from the owner thereof under a

28

written agreement at a rental which is determined by the

29

amount of receipts realized from the playing of games of

30

chance or by the number of people attending, except that an

- 14 -

 


1

eligible organization may lease a facility for a banquet

2

where a per head charge is applied in connection with the

3

serving of a meal.

4

(4)  The eligible organization has a separate bank

5

account to hold all proceeds of small games of chance.

6

(e.1)  Supplemental materials to accompany application.--An

7

annual financial report limited to the operation of games of

8

chance detailing gross profit, allowable expenses, rent, staff

9

per diem, cost of supplies, net profit and contributions to

10

charitable causes shall be filed with the licensing authority

11

and submitted with the application. This report shall be filed

12

with the application for license and shall be filed by the

13

midterm anniversary date of the license in nonapplication years.

14

This report shall be prepared on a one-page form to be designed

15

by the department. The report shall contain information for the

16

12-month period immediately preceding a date 60 days prior to

17

the filing of the report. Failure to file the report by the

18

midterm anniversary date of the license shall result in the

19

automatic suspension of the license until the licensing

20

authority certifies the report has been filed in compliance with

21

this act.

22

(f)  List of licensees.--The licensing authority, on a

23

semiannual basis, shall send a copy of all licensees to the

24

Department of Revenue.

25

(g)  List of municipalities.--The licensing authority shall

26

include with any license or renewal issued to an eligible

27

organization, an up-to-date listing of those municipalities

28

within the licensing county which have approved the referendum

29

question on small games of chance.

30

(h)  Background checks.--Each application shall include

- 15 -

 


1

criminal history records obtained from the Pennsylvania State

2

Police for the executive officer or secretary of the eligible

3

organization making the application, all other responsible

4

persons listed on the application and the eligible

5

organization's treasurer.

6

Section 8.  Section 13 of the act is amended to read:

7

Section 13.  Enforcement.

8

(a)  District attorney.--The district attorney shall

9

investigate alleged violations of this act. If the district

10

attorney finds probable cause to believe that a violation has

11

occurred, he may file a complaint against the alleged violator

12

in the court of common pleas of said county, except in counties

13

of the first class where the complaint may be filed in the

14

municipal court. In addition, the district attorney shall

15

prosecute said complaint in the manner provided by law.

16

(b)  Other law enforcement officials.--Nothing in this act

17

shall be interpreted to restrict the power of State, county or

18

local law enforcement officials to conduct investigations [and

19

enforce the provisions] of this act[.] and provide the results

20

of those investigations to the district attorney for enforcement

21

pursuant to subsection (a).

22

(c)  Department.--The department shall investigate and

23

enforce violations of this act in accordance with the act of

24

April 9, 1929 (P.L.343, No.176), known as The Fiscal Code, and

25

the act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform

26

Code of 1971.

27

Section 9.  Section 15 of the act, amended December 19, 1990

28

(P.L.812, No.195), is amended to read:

29

Section 15.  Advertising.

30

[It shall  be unlawful for any] An eligible organization or

- 16 -

 


1

person [to] may advertise the prizes or their dollar value to be

2

awarded in games of chance, provided that [prizes may be

3

identified on raffle tickets. Notwithstanding the prohibition of

4

advertising contained within this section, an eligible

5

organization may advertise prizes and values thereof in periodic

6

publications which are limited in their circulation to members

7

of the eligible organization.] such advertisements are limited

8

to publications to members of the eligible organization or signs

9

located on the eligible organization's premises.

10

Section 10.  The amendment or addition of section 10(b),

11

(e.1) and (h) of the act shall apply to applications filed more

12

than two years after the effective date of this section.

13

Section 11.  This act shall take effect as follows:

14

(1)  The following provisions shall take effect

15

immediately:

16

(i)  The amendment or addition of section 10(b),

17

(e.1) and (h) of the act.

18

(ii)  Section 10 of this act.

19

(iii)  This section.

20

(2)  The remainder of this act shall take effect in 60

21

days.

- 17 -

 


See other bills
under the
same topic