THE GENERAL ASSEMBLY OF PENNSYLVANIA

SENATE BILL

INTRODUCED BY EARLL, FOLMER, SOLOBAY, CORMAN, ORIE, SCARNATI, BOSCOLA, FONTANA, FERLO, RAFFERTY, ALLOWAY, PICCOLA, COSTA, YAW, HUGHES, KASUNIC, WAUGH, M. WHITE, WASHINGTON, EICHELBERGER, BROWNE, VOGEL, LEACH, YUDICHAK, PIPPY, MENSCH, BREWSTER, WOZNIAK, DINNIMAN AND ARGALL, FEBRUARY 23, 2011

AS AMENDED ON THIRD CONSIDERATION, OCTOBER 31, 2011   

AN ACT

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

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

eligible organizations to conduct games of chance, for the

licensing of persons to distribute games of chance, for the

registration of manufacturers of games of chance, and for

suspensions and revocations of licenses and permits;

requiring records; providing for local referendum by

electorate; and prescribing penalties," further providing for

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definitions and for prize limits; providing for insured games

of chance; further providing for sales limited, for

regulations of department, for licensing of eligible

organizations to conduct games of chance, for revocation of

licenses, for advertising and for penalties; and making

editorial changes further providing for legislative intent,

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for definitions, for games of chance permitted, for prize

limits, for limits on sales, for distributor licenses, for

regulations, for licensing of eligible organizations and for

special permits; providing for club licensees; further

providing for revocation of licenses, for enforcement, for

local option, for advertising and for prohibited persons;

providing for civil penalties; further providing for

penalties; and making editorial changes.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1.  Section 2 of the act of December 19, 1988

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(P.L.1262, No.156), known as the Local Option Small Games of

Chance Act, is amended to read:

Section 2.  Legislative intent.

The General Assembly hereby declares that the playing of

small games of chance for the purpose of raising funds, by

certain nonprofit associations, for the promotion of charitable

or civic purposes, is in the public interest.

It is hereby declared to be the policy of the General

Assembly that all phases of licensing, operation and regulation

of [small] games of chance be strictly controlled, and that all

laws and regulations with respect thereto as well as all

gambling laws should be strictly construed and rigidly enforced.

The General Assembly recognizes the possibility of

association between commercial gambling and organized crime, and

wishes to discourage commercialization of [small] games of

chance, prevent participation by organized crime and prevent the

diversion of funds from the purposes herein authorized.

Section 2.  The definitions of "daily drawing," "games of

chance," "raffle" and "weekly drawing" in section 3 of the act,

amended or added December 19, 1990 (P.L.812, No.195) and October

18, 2000 (P.L.602, No.79), are amended to read:

Section 3.  Definitions.

The following words and phrases when used in this act shall

have the meanings given to them in this section unless the

context clearly indicates otherwise:

* * *

"Daily drawing."  A game of chance in which a bona fide

member selects or is assigned a number for a chance at a prize

with the winner determined by [a] random drawing to take place

on the eligible organization's premises [during the same

operating day]. The term includes games of chance commonly known

as "member sign-in lotteries" and "half-and-half lotteries."

Nothing in this act shall be construed to prohibit the carrying

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

in the game of chance on a particular operating day. Daily

drawing winners may be determined with the aid of a passive

selection device or reference to drawings conducted by the

department pursuant to the act of August 26, 1971 (P.L.351,

No.91), known as the State Lottery Law. Daily drawing chances

may not be sold for an amount in excess of $1, and no more than

one chance per individual may be sold [to an individual during

the same operating day.] per drawing. Nothing in this definition

shall be construed to restrict a licensed eligible organization

from conducting more than one drawing per day.

* * *

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

drawings, raffles and pull-tabs, as defined in this act,

provided that no such game shall be played by or with the

assistance of any mechanical or electrical devices or media

other than a dispensing machine or passive selection device and

further provided that the particular chance taken by any person

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

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

determined solely at the discretion of the purchaser. This

definition shall not be construed to authorize any other form of

gambling currently prohibited under any provision of Title 18 of

the Pennsylvania Consolidated Statutes (relating to crimes and

offenses) or authorized under 4 Pa.C.S. (relating to

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

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

* * *

"Raffle."  A game of chance in which a participant buys a

ticket for a chance at a prize with the winner determined by a

random drawing of corresponding ticket stubs to take place at a

location and date or dates printed upon each ticket. Such games

of chance shall include lotteries but not daily drawings. Raffle

winners may be determined by reference to drawings conducted by

the department pursuant to the act of August 26, 1971 (P.L.351,

No.91), known as the State Lottery Law.

* * *

"Weekly drawing."  A game of chance in which a bona fide

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

prize with the winner determined by a random drawing to take

place on the licensed eligible organization's premises at the

end of a seven-day period. Nothing in this act shall be

construed to prohibit the carrying over of a jackpot where the

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

week. Weekly drawing winners may be determined with the aid of a

passive selection device or reference to drawings conducted by

the Department of Revenue pursuant to the act of August 26, 1971

(P.L.351, No.91), known as the State Lottery Law. Weekly drawing

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

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

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

amended to read:

Section 5.  Prize limits.

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

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

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

(b)  Weekly limit.--No more than [$5,000] $20,000 in cash or

merchandise shall be awarded by any licensed eligible 

organization in any seven-day period. 

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

merchandise shall be awarded in raffles in any calendar month.

(d)  Exception.--[An] A licensed eligible organization may

conduct a raffle and award a prize or prizes valued in excess of

[$500] $1,000 each only under the following conditions:

(1)  The licensing authority has issued a special permit

for the raffle under section 11.

(2)  [Eligible organizations] A licensed eligible

organization shall be eligible to receive no more than two

special permits in any licensed year except that volunteer

fire, ambulance and rescue organizations shall be eligible to

receive no more than three special permits in any licensed

year.

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

permit.

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

than $100,000 per calendar year.

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

governed by the prize [limitations] limitation contained in

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

organization shall not conduct daily drawings during a period

when a weekly drawing is taking place.]

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

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

daily drawing under the following circumstances: a daily drawing

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

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

or drawings which resulted from the winning number in such

drawing or drawings not being among the eligible entrants in

such drawings. Nothing contained herein shall authorize the

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

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

to conduct a drawing on an operating day during which chances

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

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

chance was sold to an eligible participant.

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

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

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

generated from such drawing, the limitations contained in

subsection (b) shall not apply.

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

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

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

by a weekly drawing under the following circumstances: a weekly

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

[$5,000] $20,000 if such prize is the result of a carryover of a

drawing or drawings which resulted from the winning number or

numbers in such drawing or drawings not being among the eligible

entrants in such drawings. Nothing contained in this act shall

authorize the prize limitations as contained in subsection (b)

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

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

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

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

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

(i)  Progressive games of chance.--Progressive games of

chance shall be permitted with a maximum cash value of $5,000.

Contributions to the pot shall be counted against the limit for

the week in which the contribution is made except that when the

limit is reached the amount awarded shall be counted toward the

limit only to the extent it was not previously counted toward a

prior week's limit.

(j)  Definitions.-- For the purpose of this section,

progressive games of chance are games of chance in which a

winning ticket awards the ticket holder an additional chance at

another game of chance or games of chance.

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

Section 5.1.  Insured games of chance.

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

act to the contrary, a licensed eligible organization may

conduct games of chance using insured games. Insured games of

chance sold by a licensed distributor shall be backed by a valid

insurance contract issued by an insurance company licensed to do

business in this Commonwealth. Proof of the insurance contract

must be provided to the department prior to the game of chance

being sold.

(b)  Revocation of license.--The license of a distributor and

an insurance company issuing a contract for an insured game of

chance may be suspended or revoked for failure to pay an award.

(c)  Definition.--For the purposes of this section, an

insured game of chance is a game of chance in which the licensed

distributor or other licensed third party guarantees making the

payment on a win of a jackpot.

Section 5.  Sections 6 and 9 of the act, amended December 19,

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

Section 6.  Sales limited.

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

chance for use within this Commonwealth except to [an] a

licensed eligible organization or distributor licensed under

this act. No game of chance, other than a raffle, sold, offered

for sale or furnished for use within this Commonwealth shall

contain, permit, depict or designate a prize having a cash value

in excess of [$500] $1,000.

Section 9.  Regulations of department.

(a)  Authorization.--The department shall promulgate

regulations to:

(1)  Impose minimum standards and restrictions applicable

to games of chance manufactured for sale in this

Commonwealth, which may include standards and restrictions

which specify the maximum number of chances available to be

sold for any single game of chance or prize and such other

standards and restrictions as the department deems necessary

for the purposes of this act. The department shall consider

standards adopted by the National Association of Gambling

Regulatory Agencies and other standards commonly accepted in

the industry.

(2)  Establish procedures by which manufacturers may

register and distributors of games of chance may apply for

licensure on forms which the department shall provide.

(3)  Provide for the suspension or revocation of

distribution licenses or manufacturer certificates for

violations of this act or regulations of the department.

(4)  Carry out other provisions of this act.

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

shall not be construed to authorize the department to promulgate

regulations providing for recordkeeping requirements for

licensed eligible organizations which require unreasonable or

unnecessary information or a repetitious listing of information.

The department shall strive to keep such recordkeeping

requirements from being an undue hardship or burden on licensed 

eligible organizations. Under no circumstances shall the

department require the retention of records for a period in

excess of two years. 

(c)  Reporting requirements.--Each licensed eligible

organization shall report to the department prizes awarded as

required by section 335 of the act of March 4, 1971 (P.L.6,

No.2), known as the Tax Reform Code of 1971.

Section 6.  Section 10 of the act, amended December 19, 1990

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

amended to read:

Section 10.  Licensing of eligible organizations to conduct

games of chance.

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

conduct or operate any games of chance unless such eligible

organization has obtained and maintains a valid license issued

pursuant to this section. Auxiliary groups within a licensed

eligible [organizations] organization shall be eligible to

conduct [small] games of chance using the license issued to the

eligible organization provided that the auxiliary group or

groups are listed on the application and license of the eligible

organization. No additional licensing fee shall be charged for

an auxiliary group's eligibility under this act. Auxiliary

groups shall not include branches, lodges or chapters of a

Statewide organization.

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

license, upon application, within 30 days any eligible

organization meeting the requirements for licensure contained in

this act to conduct and operate games of chance at such

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

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

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

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

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

the anniversary of the date of issue.

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

exists a location or premises which is the normal business or

operating site of the eligible organization and is owned or

leased by that eligible organization to conduct its normal

business, that site shall be the licensed premises for [small]

games of chance conducted by the licensed eligible organization.

If that location consists of more than one building and the

licensed eligible organization wishes to conduct its games in a

different building at that location from the one that is listed

on its application for a license and on its license, the

licensed eligible organization must notify, in writing, the

district attorney and the licensing authority of the change in

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

When [an] a licensed eligible organization does not own or lease

a specific location to conduct its normal business, that

licensed eligible organization may use another licensed eligible

organization's premises to conduct its games of chance or may

make such other arrangements that are consistent with this act,

including, but not limited to, leasing a premise under a written

agreement for a rental which is not determined by either the

amount of receipts realized from the playing of games of chance

nor the number of people attending except that an eligible

organization may lease a facility for a banquet where a per head

charge is applied in connection with the serving of a meal. When

such eligible organization changes the site of its games of

chance from that which is listed on its application for a

license and on its license, the licensed eligible organization

must notify, in writing, the district attorney and licensing

authority of the change in their [games'] games of chance site

and dates and times that will be affected. More than one

licensed eligible organization may use the same location,

provided that each eligible organization has its own license and

that the prize limitations of this act shall apply separately to

each licensed eligible organization.

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

other provisions of this section, [an] a licensed eligible

organization may conduct [small] games of chance at a location

off its premises when such games of chance are part of an annual

carnival, fair, picnic or banquet held or participated in by

that licensed eligible organization on a historical basis. The

licensed eligible organization must notify, in writing, the

district attorney and licensing authority of the location, date

and times of such events where it will be conducting [small]

games of chance.

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

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

specific location to conduct their normal business may apply for

a limited occasion license to conduct [small] games of chance on

not more than three occasions covering a total of seven days

during a licensed year. A limited occasion license entitles an 

eligible [organizations] organization holding [such a] the 

license to conduct no more than two raffles during a licensed

year where prizes may not exceed the established limits for

regular monthly raffles. Holders of limited occasion licenses

may not apply or be granted any other license or special permit

under this act. No holder of a regular license or special permit

under this act shall apply or be granted a limited occasion

license.

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

for a person, corporation, association, partnership or other

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

facility to be used exclusively for the conducting of [small]

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

organization to lease under any terms a facility or building

which is used exclusively for the conducting of [small] games of

chance.

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

be publicly displayed at the site of the [small] games of

chance.

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

[comply with the following restrictions and rules governing the

operation of games of chance] be prohibited from the following:

(1)  [No] Permitting any person under 18 years of age

[shall be permitted] to operate or play games of chance.

(2)  [No eligible organization shall permit] Permitting 

any person who has been convicted of a felony in a Federal or

State court within the past five years or has been convicted

in a Federal or State court within the past ten years of a

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

as the Bingo Law, or of this act to manage, set up, supervise

or participate in the operation of games of chance.

(3)  [No eligible organization shall pay] Paying any

compensation to any person for conducting any games of

chance. Games of chance may only be conducted by managers,

officers, directors, bar personnel and bona fide members of

the eligible organization.

(4)  [Games shall be conducted only] Conducting games of

chance on any premises other than on the licensed premises or

as otherwise provided by this act.

(5)  [The eligible organization shall not lease such]

Leasing the licensed premises under either an oral or a

written agreement for a rental which is determined by either

the amount of receipts realized from the playing of games of

chance or the number of people attending, except that an

eligible organization may lease a facility for a banquet

where a per head charge is applied in connection with the

serving of a meal. An eligible organization shall not lease

such premises from any person who has been convicted of a

violation of this act or the Bingo Law, within the past ten

years.

(6)  [Games] Purchasing games of chance, other than

raffles, daily drawings and weekly drawings[, shall be

purchased only from manufacturers and distributors] from any

person, other than a manufacturer or distributor approved by

the department.

(7)  [No licensed eligible organization shall permit]

Except as provided in subsection (d.1)(1), permitting its

licensed premises to be used for [small] games of chance by

another licensed eligible organization at the same time that

it is conducting [small] games of chance on the licensed 

premises. When a licensed eligible organization is permitting

another licensed eligible organization to use its licensed 

premises for purposes of [small] games of chance, it must

cease the operation of its own [small] games of chance during

the period that the other licensed eligible organization is

conducting its games of chance on the licensed premises.

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

in any municipality in this Commonwealth which has adopted

the provisions of this act by an affirmative vote in a

municipal referendum. A licensed eligible organization which

plans to sell raffle tickets in a municipality located in a

county other than the county in which the eligible

organization is licensed must notify that county's district

attorney and licensing authority as to the location and the

dates that the eligible organization plans to sell raffle

tickets.]

(d.1)  Sale of raffle tickets.--

(1)  A licensed eligible organization may sell on its

licensed premises the raffle tickets of another licensed

eligible organization that has been issued a limited occasion

license under subsection (b.3).

(2)  Raffle tickets may be sold off the licensed premises

in any municipality in this Commonwealth which has adopted

the provisions of this act by an affirmative vote in a

municipal referendum. A licensed eligible organization which

plans to sell raffle tickets in a municipality located in a

county other than the county in which the licensed eligibile

organization is licensed must notify that county's district

attorney and licensing authority as to the location and the

dates that the licensed eligible organization plans to sell

raffle tickets.

(d.2)  Bank account and records.--The licensed eligible

organization shall keep a bank account to hold the proceeds of

games of chance, which shall be separate from all other funds

belonging to the licensed eligible organization. Account records

shall show all expenditures and income and shall be retained by

the licensed eligible organization for at least two years.

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

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

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

contain an affidavit to be affirmed by the executive officer or

secretary of the eligible organization stating that:

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

the eligible organization to operate or play games of chance.

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

played has adequate means of ingress and egress and adequate

sanitary facilities available in the area.

(3)  The eligible organization is not leasing such

premises from the owner thereof under an oral agreement, nor

is it leasing such premises from the owner thereof under a

written agreement at a rental which is determined by the

amount of receipts realized from the playing of games of

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

eligible organization may lease a facility for a banquet

where a per head charge is applied in connection with the

serving of a meal.

(4)  The eligible organization has complied with the

annual financial report filing.

(5)  The eligible organization has a separate bank

account to hold all proceeds of games of chance. 

(6)  The eligible organization has complied with the

applicable games of chance training requirements.

(e.1)  Financial report and training requirements.--Each

eligible organization shall comply with all of the following:

(1)  An eligible organization shall file an annual

financial report with the licensing authority. The following

shall apply:

(i)  The first annual report required under this

paragraph shall contain information for the 12-month

period ending at least 60 days, but not more than 90

days, prior to the submission of the application.

Subsequent annual reports shall contain information for

the most recent 12-month period ending in the same month

as the initial report.

(ii)  The annual report shall detail gross receipts

from the conduct of games of chance, the expenses related

to the conduct of the games of chance, the prizes paid

out for games of chance and the details as to how the net

proceeds from games of chance were used or disbursed by

the eligible organization.

(iii)  The annual report shall be prepared on a one-

page form to be designed by the department. Additional

schedules shall be included, if necessary, to provide

specific details on the use or disbursement of the net

proceeds from games of chance by the eligible

organization.

(iv)  A copy of the most recent annual report shall

be filed with the application to renew the liquor license

of an eligible organization.

(2)  An eligible organization shall provide evidence to

the licensing authority that games of chance training has

been completed under this paragraph. The following shall

apply:

(i)  A minimum of four hours of training shall have

been completed within the 24-month period immediately

preceding the date of the application.

(ii)  The training shall have been completed by the

executive officer, secretary or a responsible person

listed on the application for a license of the eligible

organization. The person receiving the training shall be

associated with the conduct of games of chance by the

eligible organization.

(iii)  The training shall consist of the completion

of training materials prepared by the department. The

training materials shall be designed to assist eligible

organizations in their compliance with statutory and

regulatory requirements associated with the conduct of

games of chance. The training materials shall be

available on the department's publicly accessible

Internet website. Upon request, the department shall

provide hard copies of the training materials at a cost

not to exceed the actual cost of printing and postage.

(iv)  This paragraph shall not apply if the eligible

organization submits an affidavit affirmed by the

executive officer or secretary of the eligible

organization that the eligible organization will not

conduct games of chance on 60 or more days during the

licensing period.

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

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

Department of Revenue.

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

include with any license or renewal license issued to an

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

municipalities within the licensing county which have approved

the referendum question on [small] games of chance.

(h)  Background checks.--Each application for a license shall

include the results of a criminal history record information

check obtained from the Pennsylvania State Police, as defined in

18 Pa.C.S. § 9102 (relating to definitions) and permitted by 18

Pa.C.S. § 9121(b) (relating to general regulations), for the

executive officer or secretary of the eligible organization

making the application for a license and all other responsible

persons listed on the application.

Section 7.  Section 12(a)(12) of the act, amended December

19, 1990 (P.L.812, No.195), is amended and the subsection is

amended by adding a paragraph to read:

Section 12.  Revocation of licenses.

(a)  Grounds.--The licensing authority shall revoke or refuse

to renew the license of any eligible organization whenever the

district attorney finds upon complaint and investigation that:

* * *

(12)  The licensed eligible organization has permitted

another licensed eligible organization to conduct [small]

games of chance on its licensed premises without suspending

its own operation of [small] games of chance during the

period that the other licensed eligible organization is

conducting its games of chance on the licensed premises.

(13)  The licensed eligible organization has failed to

keep and maintain the records required under this act for a

period of two years.

* * *

Section 8.  Section 14(a) of the act is amended to read:

Section 14.  Local option.

(a)  Election to be held.--In any municipality, an election

may be held on the date of the primary election immediately

preceding any municipal election, but not more than once in four

years, to determine the will of the electors with respect to the

issuance of licenses within the limits of such municipality

under the provisions of this act. Where an election shall have

been held at the primary election preceding a municipal election

in any year, another election may be held under the provisions

of this act at the primary election occurring the fourth year

after such prior election. Whenever electors equal to at least

25% of the highest vote cast for any office in the municipality

at the last preceding general election shall file a petition

with the county board of elections of the county, or the

governing body of the municipality adopts, by a majority vote, a

resolution to place such a question on the ballot and a copy of

the resolution is filed with the board of elections of the

county, for a referendum on the question of issuing licenses,

the county board of elections shall cause a question to be

placed on the ballot or on the voting machine board and

submitted at the primary election immediately preceding the

municipal election. The question shall be in the following form:

Do you favor the issuance of licenses

to conduct [small] games of chance in the

                 of                     ?

* * *

Section 9.  Sections 15 and 17(a), (d) and (e) of the act,

amended December 19, 1990 (P.L.812, No.195), are amended to

read:

Section 15.  Advertising.

[It shall be unlawful for any eligible organization or person

to] Any licensed eligible organization or person may advertise

the prizes or their dollar value to be awarded in games of

chance, provided that [prizes may be identified on raffle

tickets. Notwithstanding the prohibition of advertising

contained within this section, an eligible organization may

advertise prizes and values thereof in periodic publications

which are limited in their circulation to members of the

eligible organization.] such advertisements shall contain the

date, time, location, whether cash or merchandise prizes will be

awarded and the name of the licensed eligible organization and

the name of the person who conducts the games of chance.

Section 17.  Penalties.

(a)  Eligible organizations.--Any eligible organization

violating the provisions of this act shall be guilty of a

summary offense and, upon conviction thereof, shall be sentenced

to pay a fine not exceeding [$1,000] $2,000 and shall for a

first offense, forfeit the license to conduct games of chance

issued to the eligible organization for the remainder of the

licensing period or six months, whichever is longer, for a

second offense, forfeit the license issued to the eligible

organization for the remainder of the current licensing period

and be ineligible to be licensed for the following licensing

period, for a third or subsequent offense, forfeit the license

issued to the eligible organization and be ineligible for a

license renewal for 30 months thereafter.

* * *

(d)  Rigging.--A person commits a misdemeanor of the first

degree if, with intent to prevent a game of chance from being

conducted in accordance with the requirements of this act or the

rules and usages governing the game of chance, he:

(1)  confers or offers or agrees to confer any benefit

upon or threatens any injury to a participant or other person

associated with the game of chance;

(2)  tampers with any person or [games] game of chance;

or

(3)  solicits, accepts or agrees to accept any benefit.

(e)  Contingent fees.--Any person who distributes,

manufactures or operates a [small] game of chance and who

requires, for equipment furnished or to play a game of chance,

payment equal to a percentage of the total winnings of any game

of chance commits a misdemeanor of the first degree.

Section 10.  This act shall apply as follows:

(1)  The amendment or addition of section 10(e)(4) and

(5), (e.1)(1) and (h) of the act shall apply to an

application for a license filed more than 60 days after the

effective date of this section.

(2)  The amendment or addition of section 10(e)(6) and

(e.1)(2) of the act shall apply to an application for a

license filed more than one year after the effective date of

this section.

Section 11.  This act shall take effect as follows:

(1)  The following provisions shall take effect

immediately:

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

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

(ii)  Section 10 of this act.

(iii)  This section.

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

days.

Section 1.  The act of December 19, 1988 (P.L.1262, No.156),

<--

known as the Local Option Small Games of Chance Act, is amended

by adding a chapter heading to read:

CHAPTER 1

PRELIMINARY PROVISIONS

Section 2.  Section 1 of the act is renumbered to read:

Section [1] 101.  Short title.

This act shall be known and may be cited as the Local Option

Small Games of Chance Act.

Section 2.1.  Section 2 of the act is renumbered and amended

to read:

Section [2] 102.  Legislative intent.

The General Assembly hereby declares that the playing of

[small] games of chance for the purpose of raising funds, by

certain nonprofit associations, for the promotion of charitable

or civic purposes, is in the public interest. In some cases the

proceeds from games of chance may be utilized to support certain

operating expenses of certain organizations.

It is hereby declared to be the policy of the General

Assembly that all phases of licensing, operation and regulation

of [small] games of chance be strictly controlled, and that all

laws and regulations with respect thereto as well as all

gambling laws should be strictly construed and rigidly enforced.

The General Assembly recognizes the possibility of

association between commercial gambling and organized crime, and

wishes to discourage commercialization of [small] games of

chance, prevent participation by organized crime and prevent the

diversion of funds from the purposes herein authorized.

Section 3.  The definitions of "civic and service

associations," "club," "daily drawing," "eligible

organizations," "fraternal organizations," "games of chance,"

"public interest purposes," "raffle" and "weekly drawing" in

section 3 of the act, amended December 19, 1990 (P.L.812,

No.195) and October 18, 2000 (P.L.602, No.79), are amended and

the section is renumbered and amended by adding definitions to

read:

Section [3] 103.  Definitions.

The following words and phrases when used in this act shall

have the meanings given to them in this section unless the

context clearly indicates otherwise:

* * *

"Civic and service [associations] association."  Any

Statewide or branch, lodge or chapter of a nonprofit national or

State organization which is authorized by its written

constitution, charter, articles of incorporation or bylaws to

engage in a civic or service purpose within this Commonwealth,

which shall have existed in this Commonwealth for one year. The

term also means a similar local nonprofit organization, not

affiliated with a national or State organization, which is

recognized by a resolution adopted by the governing body of the

municipality in which the organization conducts its principal

activities. The term shall include[, but not be limited to,]

Statewide or local bona fide sportsmen's and wildlife

associations, federations or clubs, [Statewide or local in

nature,] volunteer fire companies, volunteer rescue squads and

volunteer ambulance associations and [bona fide] senior citizens

organizations. In the case of bona fide senior citizens

organizations, the licensing authority may accept alternative

documentation for proof of purposes when there are no bylaws or

articles of incorporation in existence. The term shall also

include nonprofit organizations which are established to promote

and encourage participation and support for extracurricular

activities within the established primary and secondary public,

private and parochial school systems. Such organizations must be

recognized by a resolution adopted by the appropriate governing

body. In the case of organizations associated with the public

school system, the governing body shall be the school board of

the school district. In the case of private or parochial school

organizations, that body shall be either the board of trustees

or the Archdiocese.

"Club."  [A club, as defined in section 102] An organization

that:

(1)  is licensed to sell liquor under section 404 of the

act of April 12, 1951 (P.L.90, No.21), known as the Liquor

Code[, that]; and

(2)  qualifies as an exempt organization under section

501(c) or 527 of the Internal Revenue Code of [1954 (68A

Stat. 3] 1986 (Public Law 99-514, 26 U.S.C. § 501(c) or 527)

[and is licensed to sell liquor at retail and has a

charitable, religious or civic purpose or is organized to

benefit a political party].

"Club licensee."  A club that holds a license to conduct

small games of chance.

"Daily drawing."  A game of chance in which a bona fide

member selects or is assigned a number for a chance at a prize

with the winner determined by [a] random drawing to take place

on the licensed eligible organization's licensed premises during

the same operating day. The term includes games of chance 

commonly known as "member sign-in lotteries" and "half-and-half

lotteries." [Nothing in this act shall be construed to prohibit

the carrying over of a jackpot where the winning number has not

been entered in the game on a particular operating day.] Daily

drawing winners may be determined with the aid of a passive

selection device or reference to drawings conducted by the

department pursuant to the act of August 26, 1971 (P.L.351,

No.91), known as the State Lottery Law. Daily drawing chances

may not be sold for an amount in excess of $1, and no more than

one chance per individual may be sold [to an individual during

the same operating day] per drawing. Nothing in this definition

shall restrict an eligible organization from conducting more

than one drawing per day.

* * *

"Eligible [organizations."  Includes qualifying nonprofit

charitable, religious, fraternal and veterans organizations,

clubs and civic and service associations as defined by this act]

organization."  A charitable, religious, fraternal or veterans'

organization, club, club licensee or civic and service

association. In order to qualify as an eligible organization for

purposes of this act, an organization shall have been in

existence and fulfilling its purposes for one year prior to the

date of application for a license.

"Fraternal [organizations] organization."  A nonprofit

organization within this Commonwealth which is created and

carried on for the mutual benefit of its members, has a limited

membership and a representative form of government and is a

branch, lodge or chapter of a national or State organization.

Such organizations shall have been in existence in this

Commonwealth and fulfilling their purposes for one year prior to

the date of application for a license.

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

drawings, raffles and pull-tabs, as defined in this act,

provided that no such game shall be played by or with the

assistance of any mechanical or electrical devices or media

other than a dispensing machine or passive selection device and

further provided that the particular chance taken by any person

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

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

determined solely at the discretion of the purchaser. This

definition shall not be construed to authorize any other form of

gambling currently prohibited under any provision of Title 18 of

the Pennsylvania Consolidated Statutes (relating to crimes and

offenses) or authorized under 4 Pa.C.S. (relating to

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

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

* * *

"Licensed distributor."  A distributor of games of chance

licensed under section 307.

* * *

"Prize."  Cash or merchandise awarded for games of chance.

"Proceeds."  As follows:

(1)  For games of chance required to be purchased from a

licensed distributor, the difference between:

(i)  the face value, as indicated by the registered

manufacturer, collectible by a licensed eligible

organization from a game of chance; and

(ii)  the maximum amount of prizes available, as

indicated by the registered manufacturer, by a licensed

eligible organization from a game of chance.

(2)  For games of chance not required to be purchased

from a licensed distributor, the difference between:

(i)  the actual gross revenue collected by a licensed

eligible organization from a game of chance; and

(ii)  the actual amount of prizes paid by a licensed

eligible organization from a game of chance.

"Public interest [purposes] purpose."  [One or more of the

following:

(1)  Benefiting persons by enhancing their opportunity

for religious or education advancement, by relieving or

protecting them from disease, suffering or distress, by

contributing to their physical, emotional or social well-

being, by assisting them in establishing themselves in life

as worthy and useful citizens or by increasing their

comprehension of and devotion to the principles upon which

this nation was founded.

(2)  Initiating, performing or fostering worthy public

works or enabling or furthering the erection or maintenance

of public structures.

(3)  Lessening the burdens borne by government or

voluntarily supporting, augmenting or supplementing services

which government would normally render to the people.

(4)  Improving, expanding, maintaining or repairing real

property owned or leased by an eligible organization and used

for purposes specified in paragraphs (1), (2) and (3).

The term does not include the erection or acquisition of any

real property, unless the property will be used exclusively for

one or more of the purposes specified in this definition.] A

nonprofit benevolent, religious, educational, philanthropic,

humane, scientific, patriotic, social welfare, social advocacy,

public health, public safety, environmental or civic objective.

* * *

"Raffle."  A game of chance in which a participant buys a

ticket for a chance at a prize with the winner determined by a

random drawing of corresponding ticket stubs to take place at a

location and date or dates printed upon each ticket. Such games

of chance shall include lotteries but not daily drawings. Raffle

winners may be determined by reference to drawings conducted by

the department pursuant to the act of August 26, 1971 (P.L.351,

No.91), known as the State Lottery Law.

* * *

"Weekly drawing."  A game of chance in which a bona fide

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

prize with the winner determined by a random drawing to take

place on the licensed eligible organization's licensed premises

at the end of a seven-day period. [Nothing in this act shall be

construed to prohibit the carrying over of a jackpot where the

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

week.] Weekly drawing winners may be determined with the aid of

a passive selection device or reference to drawings conducted by

the Department of Revenue pursuant to the act of August 26, 1971

(P.L.351, No.91), known as the State Lottery Law. Weekly drawing

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

Section 4.  The act is amended by adding a chapter heading to

read:

CHAPTER 3

GAMES OF CHANCE

Section 5.  Section 4 of the act, amended December 19, 1990

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

Section [4] 301.  Games of chance permitted.

Every eligible organization to which a license has been

issued under the provisions of this [act] chapter may conduct

games of chance for the purpose of raising funds for public

interest purposes. [All] Except as provided in Chapter 5, all 

proceeds of [games of chance] a licensed eligible organization 

shall be used exclusively for public interest purposes or for

the purchase of games of chance as permitted by this act.

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

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

renumbered and amended to read:

Section [5] 302.  Prize limits.

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

subsections (c) and (d), the maximum [cash value] prize which

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

(b)  [Weekly] Aggregate prize limit.--No more than [$5,000]

$25,000 in [cash or merchandise] prizes shall be awarded from

games of chance by [any] a licensed eligible organization in any

seven-day period.

(c)  [Limit on raffles] Raffles prize limit.--[No more than

$5,000 in cash or merchandise shall] Subject to the limitations

under subsection (b), up to $10,000 in prizes may be awarded in

raffles in any calendar month.

(c.1)  Total limit.--All prizes awarded under this section

and section 301 shall be subject to the aggregate prize limits

under subsection (b).

(d)  Exception for raffles.--[An] Notwithstanding subsection

(b) or (c), a licensed eligible organization may conduct a

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

$1,000 each only under the following conditions:

(1)  The licensing authority has issued a special permit

for the raffle under section [11] 308.

(2)  [Eligible organizations] A licensed eligible

organization shall be eligible to receive no more than [two]

eight special permits in any licensed [year] term except that

a volunteer fire, ambulance [and] or rescue [organizations]

organization that is not a club licensee shall be eligible to

receive [no more than three] ten special permits in any

licensed [year] term.

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

permit issued under section 308.

(4)  [The] Except as provided under paragraph (5), the 

total [cash value] of all prizes awarded under this

subsection shall be no more than [$100,000 per calendar

year.] $200,000 per licensed term.

(5)  A volunteer fire, ambulance or rescue organization

may, in addition to the total under paragraph (4), award up

to $50,000 from raffles which shall not be subject to the

aggregate limit under subsection (b).

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

governed by the prize limitations contained in subsections (a)

and (b). An eligible organization shall not conduct daily

drawings during a period when a weekly drawing is taking place.]

(f)  [Exception] Daily drawing carryover.--The prize

limitation contained in subsections (a) and (b) may be exceeded

by a daily drawing under the following circumstances: a daily

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

[$500] $1,000 if such prize is the result of a carryover of a

drawing [or drawings] which resulted from the winning number in