WSR 00-12-097

PROPOSED RULES

GAMBLING COMMISSION


[ Filed June 7, 2000, 11:08 a.m. ]

Original Notice.

Preproposal statement of inquiry was filed as WSR 00-09-021 with a published date of May 3, 2000.

Title of Rule: Fund-raising events, WAC 230-02-504, 230-25-030 (two alternatives), 230-25-040, 230-25-070, 230-25-100, 230-25-110, 230-25-120 (two alternatives), 230-25-150, 230-25-200, 230-25-220, 230-25-310, 230-25-315, and 230-25-325 (two alternatives).

Purpose: During the 2000 session, legislation was passed amending RCW 9.46.0233 to allow charitable and nonprofit organizations to conduct a limited form of FRE. Organizations offering limited FREs, will now be able to hire employees of a FRE equipment distributor to work gaming stations at FRE events. Furthermore, no cash, only merchandise prizes, can be given away at limited FREs. This rules package sets forth the regulatory and licensing requirements for charitable and nonprofit organizations, and the FRE equipment distributors who offer limited FREs.

Statutory Authority for Adoption: RCW 9.46.070.

Summary: See Purpose above.

Name of Agency Personnel Responsible for Drafting: Susan Arland, Lacey, (360) 438-7654 ext. 374; Implementation: Ben Bishop, Lacey, (360) 438-7640; and Enforcement: Sherri Winslow, Lacey, (360) 438-7654 ext. 301.

Name of Proponent: Staff, governmental.

Rule is not necessitated by federal law, federal or state court decision.

Explanation of Rule, its Purpose, and Anticipated Effects: See Purpose above. Furthermore, three of the rules in this package have been filed with two alternatives for the commission to choose from. These are as follows:

WAC 230-25-030:

Alternative #1, currently, FRE licensees must return money earned in excess of the ten thousand dollar annual net receipts limit to players as prizes. New language was added to this rule requiring licensees conducting limited FREs to give these excess funds to another charitable organization, rather than return it to players.

Alternative #2, this alternative would require money earned in excess of the net receipts limit from all FREs to be distributed only to another charitable organization, rather than returned to players as prizes at certain FREs.

WAC 230-25-120:

Alternative #1, this rule imposes specific expenditure limits charitable and nonprofit organizations can spend on each aspect of the FRE.

Alternative #2, this alternative removes the specific dollar limits these organizations can spend when conducting FREs and states that the expenditure transactions must be commercially reasonable as established in the competitive market.

WAC 230-25-325:

Alternative #1, this rule version limits the number of member guests that are able to attend a limited FRE to 25% of total participants.

Alternative #2, this alternative removes the limitation on the percentage of member guests that can attend a limited FRE.

Proposal Changes the Following Existing Rules: See Purpose above.

No small business economic impact statement has been prepared under chapter 19.85 RCW. Proposal is exempt under RCW 19.85.025(2), therefore, a small business economic impact statement is not required.

Section 201, chapter 403, Laws of 1995, does not apply to this rule adoption. This agency does not choose to make section 201, chapter 403, Laws of 1995, apply to this rule adoption.

Hearing Location: West Coast Bellevue Hotel, 625 116th Avenue N.E., Bellevue, WA 98004, (425) 455-9444, on July 14, 2000, at 1:30 p.m.

Assistance for Persons with Disabilities: Contact Shirley Corbett by July 1, 2000, TDD (360) 438-7638, or (360) 438-7654 ext. 302.

Submit Written Comments to: Susan Arland, Mailstop 42400, Olympia, Washington 98504-2400, fax (360) 438-8652, by July 1, 2000.

Date of Intended Adoption: July 14, 2000.

June 7, 2000

Susan Arland

Rules Coordinator

OTS-4063.1


NEW SECTION
WAC 230-02-504
Fund-raising event defined.

"Fund-raising event" as set forth in RCW 9.46.0233, is an event conducted by a charitable or nonprofit organization to raise money for the organization's stated goals and purposes. During these limited duration events, bingo, amusement games, contests of chance, lotteries, and raffles may be conducted.

[]

OTS-4050.2


AMENDATORY SECTION(Amending Order 140, filed 6/15/84)

WAC 230-25-030
Fund-raising event -- Ten thousand dollars annual net receipts maximum.

(1) ((No licensee authorized to conduct)) The annual net receipts an organization shall earn conducting fund-raising events (FREs) must not exceed ten thousand dollars. Licensees must ensure the net receipts limit is not exceeded. Net receipts are calculated by subtracting money used to purchase prizes and pay-out cash prizes, from all wagers and bets received. This limitation applies to licensees conducting:

(a) One ((fund-raising event)) FRE for a period of seventy-two consecutive hours once during a calendar year ((shall conduct such an event in such a manner as to allow the total of all gross wagers and bets received by the licensee, less the amount of money paid or committed by the licensee as winnings, and for the purchase cost of prizes given as winnings, to exceed ten thousand dollars at the conclusion of such fund-raising event.

(2) No licensee authorized to conduct a fund-raising event on)); or

(b) Two FRE occasions during a calendar year ((for not more than)). Each event shall not exceed twenty-four consecutive hours ((each shall conduct such event in any manner so as to allow the total of all gross wagers and bets received by the licensee, less the amount of money paid by the licensee as winnings and for the purchase cost of prizes given as winnings to exceed ten thousand dollars either at the end of any twenty-four consecutive hours upon which such event is conducted, or during the calendar year in which such activity is authorized)).


Limited FREs may deduct cost of equipment rental.


(2) Licensees conducting limited FREs (see WAC 230-25-325) may also deduct the cost of equipment rental from their gross receipts (all wagers and bets received) when calculating the ten thousand dollar annual net receipts maximum.


Distribution of excess net receipts.


(3) ((The)) Licensees conducting FREs shall ((develop and post)) conspicuously ((and in detail)) post in the FRE gambling area ((in which the gambling is taking place)) a detailed scheme for the distribution ((to the participants)) of any ((receipts beyond those permitted to the organization by this rule, and shall offer)) money earned in excess of the ten thousand dollar annual net receipts limit. The scheme may offer money in excess of what is necessary to ensure that the licensee will not go over the annual net receipts limit. Excess net receipts must be distributed by check within thirty calendar days following the FRE. An FRE must provide all participants at the event an equal opportunity to participate in ((such)) the distribution scheme((. The scheme must provide for such distribution to be money, payable to the winner by a check. The scheme may provide for such distribution to be of more money than is necessary to ensure that the licensee will not retain greater receipts than are permitted by law, but, at minimum, must ensure that the limit is not exceeded.

(4) Winners of all prizes shall be determined during the fund-raising event. All cash prizes shall be paid by check, and merchandise prizes distributed to the winners not later than 30 calendar days following the conclusion of the event)) and winners must be chosen during the FRE: Provided, That limited FREs (see WAC 230-25-325) must distribute excess net receipts to another charitable or nonprofit organization licensed by the commission, rather than to FRE participants. The money must be distributed by check within thirty calendar days following the FRE.

[Statutory Authority: RCW 9.46.070 (5), (7), (8), (9), (11), (14) and (19). 84-13-038 (Order 140), 230-25-030, filed 6/15/84. Statutory Authority: RCW 9.46.070(7). 82-15-009 (Order 124), 230-25-030, filed 7/9/82. Statutory Authority: RCW 9.46.020(23) and 9.46.070(14). 81-19-072 (Order 111), 230-25-030, filed 9/15/81. Statutory Authority: RCW 9.46.020(23) and 9.46.070(1). 80-06-038 (Order 102), 230-25-030, filed 5/12/80. Statutory Authority: RCW 9.46.070(10). 78-11-049 (Order 87), 230-25-030, filed 10/20/78; Order 78, 230-25-030, filed 11/17/77.]

OTS-4113.1


AMENDATORY SECTION(Amending Order 140, filed 6/15/84)

WAC 230-25-030
Fund-raising event -- Ten thousand dollars annual net receipts maximum.

(1) ((No licensee authorized to conduct)) The annual net receipts an organization shall earn conducting fund-raising events (FREs) must not exceed ten thousand dollars. Licensees must ensure the net receipts limit is not exceeded. Net receipts are calculated by subtracting money used to purchase prizes and pay-out cash prizes, from all wagers and bets received. This limitation applies to licensees conducting:

(a) One ((fund-raising event)) FRE for a period of seventy-two consecutive hours once during a calendar year ((shall conduct such an event in such a manner as to allow the total of all gross wagers and bets received by the licensee, less the amount of money paid or committed by the licensee as winnings, and for the purchase cost of prizes given as winnings, to exceed ten thousand dollars at the conclusion of such fund-raising event.

(2) No licensee authorized to conduct a fund-raising event on)); or

(b) Two FRE occasions during a calendar year ((for not more than)). Each event shall not exceed twenty-four consecutive hours ((each shall conduct such event in any manner so as to allow the total of all gross wagers and bets received by the licensee, less the amount of money paid by the licensee as winnings and for the purchase cost of prizes given as winnings to exceed ten thousand dollars either at the end of any twenty-four consecutive hours upon which such event is conducted, or during the calendar year in which such activity is authorized)).


Limited FREs may deduct cost of equipment rental.


(2) Licensees conducting limited FREs (see WAC 230-25-325) may also deduct the cost of equipment rental from their gross receipts (all wagers and bets received) when calculating the ten thousand dollar annual net receipts maximum.


Distribution of excess net receipts.


(3) Licensees conducting FREs must distribute excess net receipts to another charitable or nonprofit organization licensed by the commission. The money must be distributed by check within thirty calendar days following the FRE. The licensee shall ((develop and post)) conspicuously ((and in detail)) post in the FRE gambling area ((in which the gambling is taking place a scheme for the distribution to the participants of any receipts beyond those permitted to the organization by this rule, and shall offer all participants at the event an equal opportunity to participate in such scheme. The scheme must provide for such distribution to be money, payable to the winner by a check. The scheme may provide for such distribution to be of more money than is necessary to ensure that the licensee will not retain greater receipts than are permitted by law, but, at minimum, must ensure that the limit is not exceeded.

(4) Winners of all prizes shall be determined during the fund-raising event. All cash prizes shall be paid by check, and merchandise prizes distributed to the winners not later than 30 calendar days following the conclusion of the event)) money earned in excess of the ten thousand dollar annual net receipts limit. The licensee may offer money in excess of what is necessary to ensure that the licensee will not go over the annual net receipts limit.

[Statutory Authority: RCW 9.46.070 (5), (7), (8), (9), (11), (14) and (19). 84-13-038 (Order 140), 230-25-030, filed 6/15/84. Statutory Authority: RCW 9.46.070(7). 82-15-009 (Order 124), 230-25-030, filed 7/9/82. Statutory Authority: RCW 9.46.020(23) and 9.46.070(14). 81-19-072 (Order 111), 230-25-030, filed 9/15/81. Statutory Authority: RCW 9.46.020(23) and 9.46.070(1). 80-06-038 (Order 102), 230-25-030, filed 5/12/80. Statutory Authority: RCW 9.46.070(10). 78-11-049 (Order 87), 230-25-030, filed 10/20/78; Order 78, 230-25-030, filed 11/17/77.]

OTS-4047.2


AMENDATORY SECTION(Amending WSR 96-07-077, filed 3/19/96, effective 7/1/96)

WAC 230-25-040
Fund-raising event -- House rules to be developed and posted -- Limitations on wagers.

(1) Before conducting a fund-raising event (FRE), each licensee shall develop ((a set of)) house rules ((which will)) to govern the ((type,)) scope and manner of all gambling activities to be conducted ((in conjunction with)) during the ((fund-raising event)) FRE. ((Among other information)) At a minimum, these rules shall ((establish)):

(a) State the maximum amount of a single wager((s)) that may be placed by ((persons participating in gambling activities that in any event)) FRE participants.

(i) Single wagers shall not exceed ten dollars ((being wagered upon the outcome of any one operation of an element of chance, except for));

(ii) Raffles or other similar drawings((, as set forth in RCW 9.46.0277)) may exceed the ten dollar wagering limit (see RCW 9.46.0277); and

(iii) There are no limits on wagers made using scrip.

((In addition, the rules shall)) (b) Prohibit ((the giving of)) any thing of value from being given to any person involved in the management or operation of the ((fund-raising event,)) FRE; and

(c) Prohibit any person involved in the management or operation of the ((fund-raising event)) FRE from accepting any thing of value.


Posting house rules.


(2)
A copy of the rules shall be ((posted)) conspicuously ((on the premises)) posted in the area where the ((fund-raising event)) FRE is being conducted at all times during the ((fund-raising event, and)) FRE. A copy ((thereof shall)) must be ((made)) available, upon request, to any law enforcement officer or representative of the commission.

[Statutory Authority: RCW 9.46.0277 and 9.46.070. 96-07-077, 230-25-040, filed 3/19/96, effective 7/1/96. Statutory Authority: RCW 9.46.020(23) and 9.46.070(14). 81-19-072 (Order 111), 230-25-040, filed 9/15/81. Statutory Authority: RCW 9.46.070(10). 78-11-049 (Order 87), 230-25-040, filed 10/20/78; Order 78, 230-25-040, filed 11/17/77.]

OTS-4084.1


AMENDATORY SECTION(Amending WSR 95-12-051, filed 6/2/95, effective 7/3/95)

WAC 230-25-070
Fund-raising events -- Central accounting system required.

((Each)) Licensees ((for the operation of)) conducting fund-raising events (FREs) shall establish and maintain a central accounting system in a form prescribed by the commission for all activities conducted at the ((fund-raising event)) FRE. Licensees shall obtain accounting forms from the commission, or use machine copies of such forms.


Components of the central accounting system.


((Such)) (1) The central accounting system shall contain, but not be limited to, the following items:


Personnel.


(((1) There shall be)) (a) Adequate personnel and physical areas to provide for the following minimum separation of duties:

(((a))) (i) A banker, cashier, or count room to handle the original bankroll, provide coin or chips to the games, redeem chips and cash checks for the players;

(((b))) (ii) A runner to transport money, chips and lock boxes between stations of the event;

(((c))) (iii) Pit bosses, each of whom shall supervise the operation of not more than six gambling stations and who shall supervise the transfer of lock boxes and chips/change trays to the count room((;)).


Procedures for securing, handling and counting money.


(((d))) (b) An area for the counting of money which is segregated from the area ((in which)) gambling is conducted. All money received in connection with the ((fund-raising event)) FRE shall be brought to this area for counting. Once any such money has been brought to this area, three persons shall be assigned to the count area with a minimum of two in the counting area at all times.

(((2))) (c) The beginning bankroll shall be verified by at least two persons who shall sign such verification.

(((3))) (d) There shall be documentation containing verifying signatures for the transfer of money between any two stations of the event.

(((a))) (i) All count/fill slips shall be used sequentially. VOIDED count/fill slips will be signed by two persons and retained with accounting records.

(((b))) (ii) ALL UNUSED count/fill slips shall be retained along with all other count/fill slips as part of that ((fund-raising event's)) FRE's accounting records.

(((4))) (e) All games shall be numbered and provided with lock boxes and money paddles. The money paddle shall remain in the lock box slot whenever it is not in use. The money slot of the lock box shall not exceed three and one-half inches in length and one-half inch in width.

(((5))) (f) The keys to all lock boxes are to be kept in the count room at all times and the lock boxes are to be opened only in the count room by the count room personnel.

(((6))) (g) All games are to be played using coin or chips and all currency tendered by the players shall be exchanged for coin or chips and immediately placed in the lock box by the dealer.

(((7))) (h) All money and chips shall be transferred to the count room at the end of the day or event for final tabulation, reconciliation, and verification.

(((8))) (i) The final tabulation and reconciliation shall be verified by at least three count room personnel who shall sign such verification.

(((9))) (j) Access to the count room and the bankers and cashier's areas shall be restricted to the persons assigned to those functions and to the runner(s) who transport money or chips to or from those stations.

(((10))) (k) Records shall provide sufficient detail to determine the net receipts of each activity conducted.

(((11))) (l) The records shall contain a reconciliation of the ending cash on hand to net receipts.

(((12))) (m) The ending cash on hand shall be deposited intact within two banking days of the conclusion of the event, and a validated deposit slip shall be included as part of the event records. There shall be no expenditure of any kind made from the ending cash prior to deposit. However, this subsection shall not prohibit a licensee from exchanging its ending currency and coin for a check of equal value to reduce the risk and exposure of carrying or storing large amounts of money.


Accounting system for limited FREs.


(2) This section shall not apply to ((those licensees whose receipts from the fund-raising event are limited to an admission charge or charge for a ticket, or tickets, to a drawing and who

(a) Conduct all activities with scrip, play money, or similar items which are redeemable only for merchandise prizes; and

(b) Who award only merchandise prizes that have been purchased by or donated to the licensee.

These licensees need only)) limited FRE licensees (see WAC 230-25-325). These licensees shall comply with WAC 230-08-010 and ((record their net receipts in sufficient detail to verify these amounts)) must also provide details regarding how much of the admission fees from the FRE are allocated to gambling scrip and how much is allocated to other FRE expenses.

[Statutory Authority: RCW 9.46.070. 95-12-051, 230-25-070, filed 6/2/95, effective 7/3/95. Statutory Authority: RCW 9.46.020(23) and 9.46.070(14). 81-19-072 (Order 111), 230-25-070, filed 9/15/81. Statutory Authority: RCW 9.46.070(7), (8) and (10). 78-11-049 (Order 87), 230-25-070, filed 10/20/78; Order 78, 230-25-070, filed 11/17/77.]

OTS-4052.2


AMENDATORY SECTION(Amending Order 111, filed 9/15/81)

WAC 230-25-100
Fund-raising event((s)) -- Leasing of commercial business premises ((of retail business)) -- Conditions.

(1) Fund-raising events (FREs) shall not be operated ((upon a premises part of a retail sales or service)) within a commercial business catering to the public except when:

(((1))) (a) The room or other portion of the premises in which the ((fund-raising event)) FRE is being conducted is separate and apart from the portion being used for the ((retail sales or service)) commercial business;

(((2))) (b) The commercial business is closed to the public at all times during which the ((fund-raising event)) FRE is conducted on the premises; or

(((3))) (c) The ((fund-raising event)) FRE is being conducted upon the premises of a bona fide charitable or bona fide nonprofit organization which is not also being used for a profit seeking business.

(2) No licensee shall conduct a ((fund-raising event)) FRE on or within any portion of a ((retail premise)) commercial business during the period any other ((fund-raising event)) FRE is being conducted on or within any portion of that retail premise.

(3) For limited FREs (see WAC 230-25-325), the FRE equipment distributor must not provide the facility or be otherwise compensated by the facility where the limited FRE is conducted.


Separate and apart defined.


(4)
As used in this rule, separate and apart means a permanent or temporary partition which provides a solid, distinct separation between the portion of the room or premises ((in which)) the ((fund-raising event)) FRE is being conducted and the portion of the room or premises being used for the ((retail sales or service)) commercial business ((and which)). This partition must limit((s)) the flow of pedestrians between the ((fund-raising event)) FRE and the ((retail sales or service)) commercial business to not more than two designated openings.


FRE operator to control premises - exception for liquor.


((In all cases)) (5) The ((fund-raising event)) FRE operator must have, and exercise, complete control over ((that)) the portion of the premises being used for the ((fund-raising event)) FRE, at all times ((said)) the event is being conducted: Provided, ((however,)) That ((at all times)) when the sale, service or consumption of intoxicating liquor is permitted in said portion of the premises, the ((responsibility)) liquor licensee or permittee shall be responsible for compliance with liquor laws and regulations ((shall also be that of the liquor licensee or permittee)).


Commercial business employers shall not participate in FRE.


(6) The owner, manager or any employee of the ((retail sales or service establishment may)) commercial business shall not be an officer of the ((fund-raising event)) FRE operator or participate in the operation of the ((fund-raising event)) FRE on that premises((, and no gambling activities, nor any)). No part ((or facet)) of the operation or play of any gambling activity((, may)) shall be conducted by the ((retail sales or service establishment or allowed by the operators of the fund-raising event in any portion of the premises which is being used for the fund-raising event)) commercial business. The FRE operator shall be responsible for ensuring the commercial business does not participate in any of the FRE activities.

[Statutory Authority: RCW 9.46.020(23) and 9.46.070(14). 81-19-072 (Order 111), 230-25-100, filed 9/15/81. Statutory Authority: RCW 9.46.070(1) and (10). 80-03-060 (Order 99), 230-25-100, filed 2/25/80; Order 78, 230-25-100, filed 11/17/77.]

OTS-4049.2


AMENDATORY SECTION(Amending Order 224, filed 7/17/91, effective 8/17/91)

WAC 230-25-110
Fund-raising event -- ((Use of)) Equipment use, lease or rental from licensee only.

(1) Fund-raising event (FRE) licensees must:

(a) Only purchase or rent gambling equipment from a licensed distributor or another FRE licensee; and

(b) Ensure the equipment it owns is only used during the operation of licensed FREs, or other authorized gambling activities it may offer.


Equipment transfers by FRE licensees.


(2) A FRE licensee may sell, loan or rent equipment acquired for its own FRE to another FRE licensee(s) for up to four events per year without being licensed as a FRE equipment distributor. The transfers must take place within the twelve calendar month period following the conduct of a licensed FRE.


Equipment transfers by distributors.


(3)
Only ((those)) persons holding a valid license to sell or distribute punch boards, pull-tabs, ((or)) pull-tab dispensing devices, and/or ((fund-raising event)) FRE equipment ((shall be)) are authorized to sell or lease gaming equipment to ((bona fide nonprofit or charitable organizations licensed to conduct fund-raising events)) FRE licensees for use ((in connection with)) during a licensed ((fund-raising event)) FRE.


Distributor responsibilities.


(4)
All ((rules and regulations of the)) commission rules relating to the sale or distribution of punch boards, pull-tabs, or pull-tab dispensing devices by ((such)) distributors((,)) shall be ((likewise)) applicable to the sale or rental ((by them)) of gaming equipment and pull-tabs ((for use)) used in a licensed ((fund-raising event)) FRE, except ((to the extent)) when such rules are inconsistent with the provisions of this section((: Provided, commission approval of such gaming)).


Identification stamps not required.


(5) FRE gambling
equipment ((shall not be required, nor shall)) does not require commission approval or identification stamps ((be required for such equipment: Provided further, a licensee to conduct fund-raising events may sell, loan or rent equipment acquired for its own fund-raising event to another such licensee(s) for up to four events per year without being licensed as a distributor of fund-raising event equipment)).


Price limit on sale and rental of FRE equipment.


(6)
No sale or rental of gaming equipment for use in a licensed ((fund-raising event)) FRE shall be transacted except on commercially reasonable terms established in the competitive market. All rentals shall be a lump sum or hourly rate, and shall not be based upon a percentage of the income or profit derived from the conduct of the ((fund-raising event)) FRE: Provided, That licensees conducting limited fund-raising events (see WAC 230-25-325) are subject to the limits set forth in WAC 230-25-120.

((No licensee to conduct fund-raising events shall purchase or rent gaming equipment except from another such licensee, or from a licensed distributor.

Any bona fide charitable or nonprofit organization licensed to conduct fund-raising events may utilize such equipment, not otherwise prohibited by law or these regulations, as is owned or constructed by such licensee, or which is borrowed or leased from another bona fide charitable or nonprofit organization which has been licensed by the commission to conduct fund-raising events.

No licensee to conduct fund-raising events shall use, or permit the use of, equipment owned by it for any purpose other than the operation of licensed fund-raising events, or other authorized gambling activities by the licensee: Provided, however, That the licensee may, within the twelve calendar month period following the conduct of the fund-raising event for which it was licensed, loan or rent such equipment to another bona fide charitable or nonprofit organization for use in conjunction with a licensed fund-raising event.))

[Statutory Authority: Chapter 9.46 RCW. 91-15-040 (Order 224), 230-25-110, filed 7/17/91, effective 8/17/91. Statutory Authority: RCW 9.46.070. 88-19-038 (Order 183), 230-25-110, filed 9/13/88. Statutory Authority: RCW 9.46.020(5) and 1(5), chapter 326, Laws of 1977 ex. sess., and RCW 9.46.070(4). 78-03-061 (Order 81), 230-25-110, filed 2/22/78; Order 80, 230-25-110, filed 12/28/77.]

OTS-4085.2


AMENDATORY SECTION(Amending Order 218, filed 11/26/90, effective 12/27/90)

WAC 230-25-120
Expenditure limits ((upon amount for rent, lease or similar payments)) for fund-raising events.

((Licensees shall not expend for rent or lease (or similar arrangements) of premises in which to hold a fund-raising event, or for any equipment or service in connection with the fund-raising event, an amount that exceeds the local prevailing or market price for such premises, equipment or service.

Maximum rental limits shall be:

(1) Premises and other goods or services: Not more than two hundred dollars for all, or any portion, of any twenty-four hour period.

This maximum fee shall include in addition to the use of the premises themselves any and all goods or services of any kind furnished by the person renting the premises to the licensee, or furnished by anyone with a substantial interest in, or immediate family relationship with, that person: Provided, That the limit shall not include (a) fees for gambling equipment which are governed by the maximums set out in (2) below; or (b) charges for food or drink to the licensee or patrons of the fund-raising event when the purchase of such food or drink is not, directly or indirectly, a condition of rental of the premises and the licensee may elect to bring in food and drink from an outside source.

(2) Gambling devices and equipment:

(a) Not more than four hundred dollars from each licensee for all, or any portion of, the first twenty-four hour period for all gambling devices and related equipment to conduct the event, including, but not limited to, cards, dice, cash boxes, shoes, chips, noncoin operated pull-tab dispensing devices, pull-tab scales, delivery thereof and any schooling in its use. This limitation shall not apply to the sale of pull-tabs or the rental of a bingo horse racing device.

(b) Not more than two hundred and twenty-five dollars from each licensee for each succeeding twenty-four hour period, or any portion thereof, for the same kinds of items set out in (a) above.

(3) Individual gambling station:

(a) Not more than thirty dollars for all of the equipment needed to set up each single specific gambling station (such as a single twenty-one table), except for a craps table or a roulette wheel station which shall not exceed $55 or for a station showing horse racing films with advance betting on the outcome of the races which shall not exceed $250, or each station facilitating the operation of an electronic horse racing game, with advance betting on the outcome of the races which, shall not exceed $325, for the first twenty-four hour period, or any portion thereof, including, but not limited to, the equipment, delivery and schooling in its use, to an overall maximum for all items of $400, for each licensee as set out in (2)(a) above.

(b) Not more than twenty dollars for each successive twenty-four hour period or any portion thereof, for the equipment needed to establish each single specific gambling station as set out in (a) above, to an overall maximum of $225 for each licensee as set out in (2)(b) above.

(4) The maximum charges or limits set out in subsections (1) through (3) above include any amount paid to reserve the use of applicable premises, services or equipment.

No more than 50% of the total allowable fees or charges may be paid in advance of the event. Advance payment shall be made only by check which shall not be drawn or paid more than 90 days prior to the event.

The limits in subsections (2) and (3) above shall not apply to expenditures by the licensee for purchases outright, or construction by the licensee of, gambling equipment.)) (1) The purpose of a fund-raising event (FRE) is to raise funds for organizational purposes. FREs should be operated with a profit motive as described in WAC 230-02-503. FRE licensees shall make a good faith effort to ensure that the expenses paid for all phases of the FRE, including premises, equipment rental, and prizes do not exceed the total gross receipts received for all phases of the activity.


Price limit on sale and rental of FRE equipment.


(2) No sale, rental or lease of gaming equipment, premises or services for use in a licensed FRE shall be transacted except on commercially reasonable terms established in the competitive market. All rentals shall be a lump sum or hourly rate and shall not be based upon a percentage of the income or profit derived from the conduct of a FRE.

[Statutory Authority: RCW 9.46.070. 90-24-005 (Order 218), 230-25-120, filed 11/26/90, effective 12/27/90; 88-19-038 (Order 183), 230-25-120, filed 9/13/88. Statutory Authority: RCW 9.46.070 (11) and (14). 85-03-059 (Order 146), 230-25-120, filed 1/15/85. Statutory Authority: RCW 9.46.020(23) and 9.46.070(14). 81-19-072 (Order 111), 230-25-120, filed 9/15/81. Statutory Authority: RCW 9.46.070(15). 79-11-074 (Order 93), 230-25-120, filed 10/19/79; 79-01-026 (Order 88), 230-25-120, filed 12/18/78.]

OTS-4046.3


AMENDATORY SECTION(Amending Order 218, filed 11/26/90, effective 12/27/90)

WAC 230-25-120
Limits upon amount for rent, lease or similar payments for fund-raising events -- Exceptions.

((Licensees shall not expend for rent or lease (or similar arrangements) of premises in which to hold a fund-raising event, or for any equipment or service in connection with the fund-raising event, an amount that exceeds the local prevailing or market price for such premises, equipment or service.)) No sale, rental or lease of gaming equipment, premises or services for use in a licensed fund-raising event (FRE) shall be transacted except on commercially reasonable terms established in the competitive market. All rentals shall be a lump sum or hourly rate, and shall not be based upon a percentage of the income or profit derived from the conduct of the fund-raising event.

Maximum rental limits ((shall be)) are as follows:

(((1) Premises and other goods or services: Not))


Premises goods and services.


(1) A licensee shall pay no more than two hundred dollars for the use of a FRE premises and all goods and services provided by the person renting the premises for all, or any portion, of any twenty-four hour period.

This maximum fee shall include in addition to the use of the premises themselves any and all goods or services of any kind furnished by the person renting the premises to the licensee, or furnished by anyone with a substantial interest in, or immediate family relationship with, that person: Provided, That the limit shall not include:

(a) Fees for gambling equipment which are governed by the maximums set out in subsection (2) ((below)) of this section; or

(b) Charges for food or drink to the licensee or patrons of the ((fund-raising event)) FRE when the purchase of such food or drink is not, directly or indirectly, a condition of rental of the premises and the licensee may elect to bring in food and drink from an outside source.

(((2) Gambling devices and equipment:

(a) Not more than))


Gambling devices and equipment.


(2) For all gambling devices and related equipment used to conduct a FRE, each licensee shall not pay more than:

(a) Four hundred dollars ((from each licensee)) for all, or any portion of, the first twenty-four hour period ((for all));

(b) Two hundred and twenty-five dollars for each succeeding twenty-four hour period, or any portion thereof;

(c) This limitation shall not apply to:

(i) Expenditures by the licensee for outright purchases, or construction by the licensee to build gambling equipment; or

(ii) The sale of pull-tabs or the rental of a bingo horse racing device;

(d) For purposes of this section, gambling devices and related equipment ((to conduct the event, including)) include, but is not limited to, cards, dice, cash boxes, shoes, chips, noncoin operated pull-tab dispensing devices, pull-tab scales, delivery thereof and any schooling in its use. ((This limitation shall not apply to the sale of pull-tabs or the rental of a bingo horse racing device.

(b) Not more than two hundred and twenty-five dollars from each licensee for each succeeding twenty-four hour period, or any portion thereof, for the same kinds of items set out in (a) above.

(3) Individual gambling station:

(a) Not more than thirty dollars))


Individual gambling station.


(3) F
or all ((of the)) gambling equipment needed to set up each single specific gambling station (such as a single twenty-one table), ((except for a)) each licensee shall not pay more than thirty dollars per table: Provided, That

(a) Each craps table or ((a)) roulette wheel station ((which)) shall not exceed (($55 or for a)) fifty-five dollars;

(b) Each station showing horse racing films with advance betting on the outcome of the races which shall not exceed (($250, or)) two hundred fifty dollars;

(c) Each station facilitating the operation of an electronic horse racing game, with advance betting on the outcome of the races which, shall not exceed (($325)) three hundred twenty-five dollars, for the first twenty-four hour period, or any portion thereof((, including, but not limited to,)): Provided further, That the equipment, delivery and schooling in its use((, to an overall maximum for all items of $400)) shall not exceed four hundred dollars, for each licensee as set out in subsection (2)(a) ((above.)) of this section;

(((b))) (d) Not more than twenty dollars for each successive twenty-four hour period or any portion thereof, for the equipment needed to establish each single specific gambling station as set out in (a) ((above)) of this subsection, to an overall maximum of (($225)) two hundred twenty-five dollars for each licensee as set out in subsection (2)(b) ((above)) of this section;

(e) This limit shall not apply to expenditures by the licensee for purchases outright, or construction by the licensee of gambling equipment.


Deposits.


(4) The maximum charges or limits set out in subsections (1) through (3) ((above)) of this section include any amount paid to reserve the use of applicable premises, services or equipment.


Advance payments.


(5) No more than ((50%)) fifty percent of the total allowable fees or charges may be paid in advance of the event. Advance payment shall be made only by check which shall not be drawn or paid more than ((90)) ninety days prior to the event.

((The limits in subsections (2) and (3) above shall not apply to expenditures by the licensee for purchases outright, or construction by the licensee of, gambling equipment.))


Exception for FRE.


(6) The purpose of a FRE is to raise funds for organizational purposes and therefore should be operated with a profit motive as described in WAC 230-02-503. Licensees conducting limited FREs (see WAC 230-24-325) shall make a good faith effort to ensure that the expenses paid for all phases of the fund-raising activity, including premises and equipment rental, and prizes do not exceed the total gross receipts received for all phases of the activity.


Exception for recreational gaming activity (RGA).


(7) The purpose of a RGA is strictly for entertainment and recreational purposes, not fund-raising. Participation in a RGA shall not be limited to charitable or nonprofit organizations and their members. Therefore, the limitations set forth in this section shall not apply to a RGA's premises or equipment costs.

[Statutory Authority: RCW 9.46.070. 90-24-005 (Order 218), 230-25-120, filed 11/26/90, effective 12/27/90; 88-19-038 (Order 183), 230-25-120, filed 9/13/88. Statutory Authority: RCW 9.46.070 (11) and (14). 85-03-059 (Order 146), 230-25-120, filed 1/15/85. Statutory Authority: RCW 9.46.020(23) and 9.46.070(14). 81-19-072 (Order 111), 230-25-120, filed 9/15/81. Statutory Authority: RCW 9.46.070(15). 79-11-074 (Order 93), 230-25-120, filed 10/19/79; 79-01-026 (Order 88), 230-25-120, filed 12/18/78.]

OTS-4048.1


AMENDATORY SECTION(Amending Order 183, filed 9/13/88)

WAC 230-25-150
Pull-tabs at fund-raising events -- Authorized.

Pull-tabs are authorized for use at fund-raising (FREs) events and shall be treated as conducted solely ((pursuant to)) under the FRE license ((to conduct a fund-raising event)): Provided, That pull-tabs shall not be offered for sale at limited FREs (see WAC 230-25-325). Except where superseded by WAC 230-25-160, all rules applicable to the operation of pull-tabs set forth in chapter 230-30 WAC shall be applicable to pull-tabs utilized at ((fund-raising events)) FREs.

[Statutory Authority: RCW 9.46.070. 88-19-038 (Order 183), 230-25-150, filed 9/13/88.]

OTS-4051.2


AMENDATORY SECTION(Amending Order 251, filed 5/17/94, effective 7/1/94)

WAC 230-25-200
Bingo at fund-raising event.

Bingo games conducted as part of a licensed fund-raising event (FRE) authorized by chapter 9.46 RCW shall be treated as conducted solely ((pursuant to)) under the FRE license ((to conduct that fund-raising event)). All income, prizes awarded, and other expenses shall be separately accounted for, and reported to the commission((,)) as ((fund-raising event)) FRE activity. The following procedures apply to bingo conducted as part of a ((fund-raising event)) FRE:

(1) All general requirements and limitations set out in chapter 230-25 WAC apply.


Income.


(2) Income from bingo games shall be applied only against the maximum income permitted for ((fund-raising events)) FREs and shall not be applied against other maximum income limits imposed by chapter 9.46 RCW or the commission rules.


Rules not applicable to FRE bingo.


(3) All of the commission's rules applicable to the conduct of bingo games shall apply: Provided, That the following rules shall not be applicable to bingo games conducted as part of a ((fund-raising event)) FRE:

(a) WAC 230-20-064;

(b) WAC 230-20-065;

(c) WAC 230-20-070;

(d) WAC 230-20-170;

(e) WAC 230-20-242; and

(f) WAC 230-20-246(10).


Bingo card inventory.


(4) If a FRE licensee is also a bingo licensee and uses disposable bingo cards ((are used to conduct)) for bingo games ((at fund-raising events and the organization has a license to conduct bingo)) conducted at a FRE, the inventory control procedures of WAC 230-08-105 shall apply. A reference to all cards or packets of cards used shall be made in the inventory control records. If the organization does not have a license to conduct bingo, all unused cards or packets must be retained as part of the event record: Provided, That licensees may return unused cards or packets to the distributor if there are no breaks in the audit numbers of the unused portion. The distributor shall document the total number of cards or packets returned and the beginning and ending audit numbers.


Bingo at limited FREs.


(5) If bingo is conducted at a limited FRE (see WAC 230-25-325), scrip may be used to purchase bingo cards and participants may only play for merchandise prizes.

[Statutory Authority: RCW 9.46.070. 94-11-095 (Order 251), 230-25-200, filed 5/17/94, effective 7/1/94. Statutory Authority: RCW 9.46.070 (5), (7), (8), (9), (11), (14) and (19). 84-13-038 (Order 140), 230-25-200, filed 6/15/84; Order 78, 230-25-200, filed 11/17/77.]

OTS-4059.2


AMENDATORY SECTION(Amending WSR 96-07-077, filed 3/19/96, effective 7/1/96)

WAC 230-25-220
Raffles or similar drawings conducted at fund-raising events.

Raffles or similar drawings may be conducted at fund-raising events ((so long as)) (FREs) when they meet the following requirements:


Sales and drawings at event only.


(1) ((No sales of tickets or)) All aspects of a raffle or similar drawing must be conducted at the FRE to be considered a raffle held at such event. All tickets must be sold during the event and drawing(s) ((in any raffle or similar drawing wherein the winner or winners are chosen by the drawing)) of a ticket ((or other)), card, or other device ((shall be done at, or in connection with, a licensed fund-raising event unless all aspects of the raffle or similar drawing are done only at the fund-raising)) must be held during the event.


Sales and drawings conducted outside a FRE.


(2) If any raffle ticket((, card or other device for a raffle or similar drawing)) is sold, or any drawing for a raffle or similar drawing held, other than ((at and)) during a licensed ((fund-raising event, then)) FRE:

(a) No portion of the raffle or similar drawing shall be conducted at or during any licensed ((fund-raising event, nor shall)) FRE; and

(b) The raffle or similar drawing shall not be considered as being held under the ((fund-raising event)) FRE license for ((any)) such ((fund-raising event)) FRE.


Raffles conducted under a FRE license.


(3) Raffles or other similar drawings wherein the winner or winners are chosen by the drawing of a ticket or other card or device conducted at, or as a part of, a licensed ((fund-raising event)) FRE authorized by RCW 9.46.0311 shall be treated as conducted under the license to conduct that ((fund-raising event)) FRE. All income, prizes awarded, and other expenses shall be accounted for, and reported to the commission, as required for ((fund-raising events)) FREs but shall not be reported, or accounted for, as required for raffles conducted under a raffle license issued by the commission, or under different statutory authority: Provided, That the requirements of WAC 230-20-325 applicable to raffles shall be applicable to all such drawings conducted at a ((fund-raising event)) FRE, except that single chances on drawings may be sold for up to twenty-five dollars per chance.


Income from raffles.


(4) Income from raffles or other drawings conducted at, or as a part of, such a ((fund-raising event)) FRE shall be applied only against the maximum income permitted for ((fund-raising events)) FREs and shall not be applied against other maximum income limits imposed by chapter 9.46 RCW or the commission's rules.


Rules not applicable to FRE raffles.


(5) All ((of the)) commission(('s)) rules applicable to ((the conduct of)) raffles, whether general or specific, shall apply to ((the conduct of)) raffles and to the conduct of other similar drawings wherein the winner or winners are chosen by the drawing of a ticket or similar card or device at, or as a part of, a ((fund-raising event)) FRE, except as provided in subsection (3) of this section and except the following rules which shall not be applicable:

(a) WAC 230-08-070;

(b) WAC 230-20-350; and

(c) WAC 230-12-020.


Raffles conducted under a raffle license during a FRE.


(6) Subsections (1) through (5) of this section shall not apply to a drawing held during a ((fund-raising event)) FRE if the raffle is conducted under a raffle license issued by the commission((,)) and all tickets for the raffle are sold and deposited into the drawing container before the beginning of the ((fund-raising event)) FRE.


Raffles at limited fund-raising events.


(7) Two types of raffles may be offered at limited FREs (see WAC 230-25-325):

(a) Raffles as set forth in subsection (1) through (6) of this section; and

(b) Raffles may be conducted during FREs or at the end of the event as a means of determining who will win merchandise prizes. Raffle tickets for these types of raffles shall only be purchased with noncash value scrip provided at the event by the FRE equipment distributor.

[Statutory Authority: RCW 9.46.0277 and 9.46.070. 96-07-077, 230-25-220, filed 3/19/96, effective 7/1/96. Statutory Authority: RCW 9.46.070 (1), (2), (4), (5), (6), (9), (11), (14) and (17) and 9.46.020 (19) and (23). 85-17-015 (Order 153), 230-25-220, filed 8/12/85. Statutory Authority: RCW 9.46.020 (1) and (23) and 9.46.070(1). 85-11-023 (Order 150), 230-25-220, filed 5/13/85. Statutory Authority: RCW 9.46.020(23) and 9.46.070(14). 81-19-072 (Order 111), 230-25-220, filed 9/15/81. Statutory Authority: RCW 9.46.070(10). 78-04-032 (Order 83), 230-25-220, filed 3/16/78; Order 78, 230-25-220, filed 11/17/77.]

OTS-4060.1


AMENDATORY SECTION(Amending Order 87, filed 10/20/78)

WAC 230-25-310
Fund-raising event -- List of workers to be available on premises.

(1) The licensee conducting a fund-raising event (FRE) shall prepare and have available on the premises a list of all persons taking part in the management or operation of the ((fund-raising event)) FRE. Such list shall contain the name, address, telephone number and a description of the type of membership in the organization of each person. The list shall be maintained as part of the licensee's records of the event and shall be made available to any law enforcement officer or representative of the commission upon request.

(2) Licensees conducting limited FREs (see WAC 230-25-325) shall include the name of the FRE equipment distributor and shall obtain from the distributor the names of all workers employed by the distributor who worked the event.

[Statutory Authority: RCW 9.46.020(23) and 9.46.070(7). 78-11-049 (Order 87), 230-25-310, filed 10/20/78.]

OTS-4062.2


AMENDATORY SECTION(Amending Order 111, filed 9/15/81)

WAC 230-25-315
Workers to wear identification tabs.

(1) Each licensee conducting a fund-raising event (FRE) shall furnish ((to)) each ((person)) member participating in the management or operation of the ((event)) FRE an identification tag ((which)) that, at a minimum ((shall)), contains ((that person's name and designation of licensee)) the names of the member and licensed organization. Name tags must include at least the member's first initial and last name or first name and initial of the last name. The licensee shall cause each ((such person)) member to wear this tag at all times when the ((person)) member is working at the ((fund-raising event)) FRE. The tag shall be worn in plain view so as to be easily seen and read by persons participating in the event. The type and style of tag shall be the option of the licensee.

(2) During a limited FRE (see WAC 230-25-325), employees of the FRE equipment distributor shall wear name tags that, at a minimum, state the first name of the employee and full name of the FRE equipment distributor.

[Statutory Authority: RCW 9.46.020(23) and 9.46.070(14). 81-19-072 (Order 111), 230-25-315, filed 9/15/81.]

OTS-4064.2


NEW SECTION
WAC 230-25-325
Limited fund-raising event -- Procedures and restrictions.

Pursuant to RCW 9.46.0233(2), nonprofit or charitable organizations may offer limited fund-raising events (FREs). Organizations offering limited FREs must operate the FRE under the following operational procedures:


Operating procedures.


(1) Only members of the organization and their guests shall participate in the event. Guests may not exceed twenty-five percent of event participants.

(2) Participants shall purchase scrip with cash.

(3) Scrip shall be exchanged at gambling stations for chips.

(4) Only bona fide members will be utilized for all transactions involving acceptance of cash for scrip, conducting the schemes to determine the winners of merchandise prizes, and maintaining records during the event.

(5) The value of all purchased prizes must not exceed ten percent of the gross revenue from the event, less the cost of the FRE equipment rental contract.

(6) Any prizes purchased from the FRE equipment distributor must be disclosed. The cost may not exceed the fair market value. Prizes may be disclosed to the public at the retail value.


FRE equipment distributors.


Limitations.


(7) The nonprofit organization may only contract with a person or organization licensed as a FRE equipment distributor to provide the equipment and staff to operate the gaming stations.

(8) Under no circumstances shall employees of the FRE equipment distributor handle cash transactions or allow participants to purchase chips with cash.


Compensation.


(9) The fee paid to the FRE equipment distributor shall be in compliance with WAC 230-25-120. The FRE distributor shall not share in any way in the proceeds of the event except as set forth in the rule.


Information to be submitted with FRE application.


(10) The application must include details relating to the initial cost to participate, and method for purchasing additional scrip, as well as identify all costs included in the initial price to enter that are not related to the gambling activity (i.e., meals, drinks, etc.). The application must also identify the scheme that will be followed to distribute the merchandise prizes to participants at the end of the event (i.e., raffle, auction, etc.).

(11) All contracts signed by the FRE licensee with the FRE equipment distributor and premises provider must be submitted with the FRE license application.

[]

OTS-4114.1


NEW SECTION
WAC 230-25-325
Limited fund-raising event -- Procedures and restrictions.

Pursuant to RCW 9.46.0233(2), nonprofit or charitable organizations may offer limited fund-raising events (FREs). Organizations offering limited FREs must operate the FRE under the following operational procedures:


Operating procedures.


(1) Only members of the organization and their guests shall participate in the event.

(2) Participants shall purchase scrip with cash.

(3) Scrip shall be exchanged at gambling stations for chips.

(4) Only bona fide members will be utilized for all transactions involving acceptance of cash for scrip, conducting the schemes to determine the winners of merchandise prizes, and maintaining records during the event.

(5) The value of all purchased prizes must not exceed ten percent of the gross revenue from the event, less the cost of the FRE equipment rental contract.

(6) Any prizes purchased from the FRE equipment distributor must be disclosed. The cost may not exceed the fair market value. Prizes may be disclosed to the public at the retail value.


FRE equipment distributors.


Limitations.


(7) The nonprofit organization may only contract with a person or organization licensed as a FRE equipment distributor to provide the equipment and staff to operate the gaming stations.

(8) Under no circumstances shall employees of the FRE equipment distributor handle cash transactions or allow participants to purchase chips with cash.


Compensation.


(9) The fee paid to the FRE equipment distributor shall be in compliance with WAC 230-25-120. The FRE distributor shall not share in any way in the proceeds of the event except as set forth in the rule.


Information to be submitted with FRE application.


(10) The application must include details relating to the initial cost to participate, and method for purchasing additional scrip, as well as identify all costs included in the initial price to enter that are not related to the gambling activity (i.e., meals, drinks, etc.). The application must also identify the scheme that will be followed to distribute the merchandise prizes to participants at the end of the event (i.e., raffle, auction, etc.).

(11) All contracts signed by the FRE licensee with the FRE equipment distributor and premises provider must be submitted with the FRE license application.

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Washington State Code Reviser's Office