California offers charity gambling opportunities for nonprofits. Both raffles and bingo games are regulated by the State and local jurisdictions.
Bingo: Bingo developed out of the parlor board game of lotto. The board game of lotto goes back well over 200 years. Bingo is still played in the same manner in a number of countries. American bingo as a parlor game is played on a five by five card with the letters BINGO at the top and a free space in the middle. It is a game that can be played by children and is frequently used in schools as a teaching tool to learn numbers, letters and colors.
But in June of 1976, the voters approved Proposition 9 and the game of Bingo became a game offered by charities to enhance fundraising activities to provide funds to the needy they serviced. Certain limitations were included as a safeguard, a pot limit of $250 was set and the games could only be staffed by members of the non profit organization. Charity organizations offered a chance for a small compensation to win a prize. Thus, the parlor game of bingo became gambling. Bingo is regulated by State Constitutional law, Article IV, Section 19 (c) and State Penal Code 326.5(o). But oversight was to be provided by the host jurisdiction.
In 2007, the game of Bingo began to change, vendors from out of state began to offer electronic Bingo machines which resembled and played like a slot machine. The debate began on the legality of these machines, their impact on the ability of the State to continue to collect revenue sharing from tribal state compacts and complicated jurisdictional enforcement issues over regulation of the games.
Third parties began to stake out a cottage industry by offering to host games for charities, providing locations, equipment, security and management. But who are these entrepreneurs? Where was, if any, local or state regulatory oversight over this evolving cash intensive bingo machine industry?
2008 witnessed the tipping point that led to State legislation assisting charities consistent with the will of the voters in the 1976 authorizing initiative. The new language cleaned up the loop-holes in which out-of-state bingo slot manufacturers were exploiting creating unregulated bingo casinos. The pot limit was expanded and charities were granted a new form of Bingo called “remote caller” but again with restrictions and safeguards. Click on the Bingo file for more information.
Raffles: In California, charities and certain other private nonprofit organizations may conduct raffles to raise funds for beneficial charitable purposes in the State. The exception to the general constitutional prohibition against lotteries requires that at least 90 percent of the gross receipts from these raffles go directly to beneficial or charitable purposes in California.
How an organization qualifies and how the raffles must be conducted is governed by Penal Code section 320.5, which was added by Senate Bill 639, Chapter 778, Stats of 2000. Please see related items below for further detail.