HOUSE BILL REPORT

ESSB 5723

This analysis was prepared by non-partisan legislative staff for the use of legislative members in their deliberations. This analysis is not a part of the legislation nor does it constitute a statement of legislative intent.

As Reported by House Committee On:

Government Accountability & Oversight

Title: An act relating to enhanced raffles.

Brief Description: Authorizing enhanced raffles conducted by bona fide charitable or nonprofit organizations serving individuals with intellectual disabilities.

Sponsors: Senate Committee on Commerce & Labor (originally sponsored by Senators Hewitt, Conway, Brown and Kline).

Brief History:

Committee Activity:

Government Accountability & Oversight: 3/21/13 [DPA].

Brief Summary of Engrossed Substitute Bill

(As Amended by Committee)

  • Authorizes specified charitable and nonprofit organizations to conduct up to four enhanced raffles per year subject to approval by the Washington State Gambling Commission.

  • Limits the eligibility to conduct enhanced raffles to those bona fide charitable or nonprofit organizations whose primary purpose is serving individuals with intellectual disabilities.

  • Defines "enhanced raffle" as a game involving the sale of tickets bearing an individual number and in which a grand prize and smaller prizes are awarded on the basis of drawings of the tickets by the person or persons conducting the game.

  • Limits the value of the grand prize to $5 million and the cost of tickets to $250 each.

  • Requires that by December 2017 the Washington State Gambling Commission report back to the Legislature regarding any enhanced raffles conducted under the authorization of the act.

HOUSE COMMITTEE ON GOVERNMENT ACCOUNTABILITY & OVERSIGHT

Majority Report: Do pass as amended. Signed by 9 members: Representatives Hurst, Chair; Wylie, Vice Chair; Condotta, Ranking Minority Member; Holy, Assistant Ranking Minority Member; Blake, Kirby, Moscoso, Shea and Smith.

Staff: Thamas Osborn (786-7129).

Background:

Washington's Gambling Act authorizes charitable and nonprofit organizations to conduct raffles to raise funds for the organizations' stated purposes. A raffle is an event where tickets are sold and prizes are awarded based on a random drawing. In general, only certain charitable and nonprofit organizations are permitted to offer raffles. Organizations must be organized or operated for one of the following purposes: agricultural, athletic, charitable, civic, educational, fraternal, patriotic, political, or social. Agricultural fairs, fraternal societies, religious societies, churches, and granges also qualify. There are also some circumstances under which credit unions, cities, counties, and towns, and executive branch state employees may offer raffles. The Washington State Gambling Commission (Commission) regulates raffles. The maximum price of a raffle ticket is $100.

Some raffles require a license from the Commission and others do not:

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Summary of Amended Bill:

The Commission is authorized to approve two enhanced raffles per calendar year in western Washington and two in eastern Washington. Only a bona fide charitable or nonprofit organization whose primary purpose is serving individuals with intellectual disabilities is eligible to conduct an enhanced raffle. "Enhanced raffle" means a game involving the sale of tickets bearing an individual number and in which a grand prize and smaller prizes are awarded on the basis of drawings of the tickets by the person or persons conducting the game. The cost of tickets may not exceed $250 each. In addition to a grand prize drawing, an enhanced raffle may include additional related entries and drawings for lesser prizes.

In order to be approved by the Commission, an enhanced raffle must meet the following conditions:

Raffle ticket order forms may be obtained by printing them from the website of the charity or nonprofit organization sponsoring the raffle, but obtaining a raffle ticket order form in this manner does not constitute the sale of a raffle ticket.

Subject to the approval of the Commission, the sponsoring organization has the option of including the following elements and features as part of the design and management of the raffle:

The Commission has the authority to set fees for bona fide charitable or nonprofit organizations, call center vendors, and consultants conducting enhanced raffles. It is also authorized to adopt rules governing the licensing and operation of such raffles.

By December 2017, the Commission must report to the Legislature regarding the enhanced raffles authorized under this act with respect to the following:

The act terminates as of June 30, 2016.

Amended Bill Compared to Engrossed Substitute Bill:

The House of Representatives' committee amendment makes the following changes to the Engrossed Substitute Senate Bill:

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Appropriation: None.

Fiscal Note: Available.

Effective Date of Amended Bill: The bill takes effect 90 days after adjournment of the session in which the bill is passed.

Staff Summary of Public Testimony:

(In support) This Senate bill is virtually identical to House Bill 1835 which passed out of this committee earlier this year. The Washington State Gambling Commission (Commission), the Washington tribes, and the Recreational Gaming Association have worked on this bill and are in accord regarding its provisions. The bill does not allow the purchase of raffle tickets over the Internet. However, the bill does need an amendment making the following changes: (1) authorizing the printing of raffle ticket order forms from the website of the charity or nonprofit organization sponsoring the raffle, but specifying that obtaining a raffle ticket order form in this way does not constitute the sale of a raffle ticket; and (2) changing the expiration date of the act from June 30, 2017, to June 30, 2016.

(Neutral) The Commission is neutral regarding this bill, but is comfortable with the content of the proposed amendment. However, the Commission does have two concerns about the substantive content of the bill: (1) it may be in conflict with federal laws regarding the use of United States mail; and (2) the federal Indian Gaming Regulatory Act may pose legal problems.

(Opposed) None.

Persons Testifying: (In support) Denny Eliason, Special Olympics Washington.

(Neutral) Amy Hunter, Washington State Gambling Commission.

Persons Signed In To Testify But Not Testifying: None.