Charitable Gaming Division Texas Hold’em Experience Charitable Gaming History • Charitable Gaming was created when the Traxler-McCauley-Law-Bowman Bingo Act, PA 382 of 1972 was signed into law. (Bingo Act) • The Bingo Act allows for licensing and regulation of bingo, raffles, charity game tickets, and millionaire parties.
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Charitable Gaming Division
Texas Hold’em Experience
Charitable Gaming History
• Charitable Gaming was created whenthe Traxler-McCauley-Law-BowmanBingo Act, PA 382 of 1972 was signedinto law. (Bingo Act)
• The Bingo Act allows for licensing andregulation of bingo, raffles, charity gametickets, and millionaire parties.
Mission Statement
• Provide services to the general public in aprofessional, positive, and efficient manner.
• Ensure that only organizations that qualify inaccordance with the statute receive licenses.
• Ensure that licensed gaming events areconducted in a fair and honest manner.
• Ensure that funds received from the generalpublic through licensed gaming events areaccounted for and used for the lawful purposesof the organization.
Charitable Gaming History
• 70’s and 80’s, Bingo and Millionaireparties were the bulk of non profitfundraising.
• Bingo’s and Millionaire Parties died inthe 1990’s
• Non profits then looked for otheravenues of fundraising
Charitable Gaming History• Charitable Gaming recognized that charitable
organizations needed a kick start in generatingrevenue for their lawful purpose.
• New card games were authorized for play:– Let it Ride– Tournament Texas Hold'em– Fixed Limit Texas Hold'em– Seven Card Stud– Omaha Hi Lo– Blackjack
• Texas Hold’em became the most popular andsuccessful program to date.
Texas Hold’em
Revenue increased by almost $20 millionfrom FY 2009 to FY 2010. TexasHold’em Poker is still the main draw forplayers.
As long as the popularity for TexasHold’em continues, Millionaire Partiesshould be a lucrative fundraiser forcharities.
Non Profits Types That Are EligibleThere are nine types of organizations that have thepotential to be qualified:
• Educational• Educational Subordinate• Fraternal• Local Civic• Religious• Religious Subordinate• Senior Citizens• Service• Veterans
Example: Lions clubs qualify under “Service Organization”
Qualification Example/Service OrganizationIf the organization has never submitted qualifying information as a serviceorganization, the following information shall be submitted in the name of theorganization prior to being approved to conduct a bingo, millionaire party, raffle,or charity game. A previously qualified organization may be required to submitupdated qualification information to assure its continued eligibility under the act.
1. A signed and dated copy of the organization’s current bylaws or constitution,including membership criteria.
2. A complete copy of the organization’s Articles of Incorporation that have beenfiled with the Corporations and Securities Bureau, if the organization isincorporated.
3. A provision in the bylaws, constitution, or Articles of Incorporation that allassets, and real and personal property will revert to the local government oranother nonprofit organization should the organization dissolve.
4. A copy of the letter from the IRS stating the organization is exempt from federaltax under IRS code 501(c), OR, copies of one bank statement per year for theprevious five years, excluding the current year.
5. A copy of the charter or a directory published by the state or nationalorganization that lists the organization.
6. A copy of the state or national bylaws may need to be submitted. The state ornational bylaws shall provide for all requirements pursuant to R432.21202(4).
Qualification Requirements(1) Each applicant applying for a gaming license who has not previously qualifiedshall first submit qualification information as required by the bureau.
(2) Except as provided in the act, each applicant shall provide proof that itsbylaws, constitution, articles of incorporation, or the bylaws or constitution of itsparent organization include a statement of dissolution. The statement ofdissolution shall state that all assets of the qualifying organization remainingupon dissolution, after satisfying its debts, be distributed to the local governmentor another nonprofit organization.
(3) The bureau, at its discretion, may require a previously qualified organizationto submit updated qualification information to assure the organization’scontinued eligibility under the act.
(4) In addition to the requirements of the act, the commissioner shall considercertain factors when determining if an applicant or licensee qualifies as a“branch,” “lodge,” or “chapter.”
Qualification Requirements Cont.These include, but are not limited to, the following:
(a) Charter or similar document issued by the national or state organization uponacceptance as a branch, lodge, or chapter.(b) Conditions established by the national or state organization for the revocationor suspension of the charter or relationship.(c) Dues or financial support submitted to the national or state organization bythe branch, lodge, or chapter.(d) Degree of control exerted by the national or state organization over theactivities of the branch, lodge, or chapter.(e) Oversight and control provided by the national or state organization over thefinancial affairs of the branch, lodge, or chapter, including the audit of financialrecords of the branch, lodge, or chapter.(f) Standard bylaws adopted by the branch, lodge, or chapter or bylaws submittedto the national or state organization for approval.(g) Appointed or elected officers of the branch, lodge, or chapter who areresponsible for the activities of the branch, lodge, or chapter.(h) Ability of the branch, lodge, or chapter to influence activities (normallydemonstrated by voting privileges) at the state or national level.
Gaming License Applications(1) A qualified organization, unless ineligible under the act, shall be eligible to apply
for a gaming license.(2) A qualified organization shall submit an application for a gaming license on a
form provided by or approved in writing by the bureau.(3) In addition to the gaming license application, the applicant shall submit
additional information as directed by the bureau.(4) The gaming license application shall be accompanied by the appropriate fee.(5) If a gaming license application is cancelled or denied, then the bureau may retain
a portion of the original statutory fee submitted to cover processing costs.(6) An applicant shall disclose to the bureau whether any individual, officer, or agent
of the applicant has ever been convicted or becomes convicted of, or forfeited bondupon a charge of, or pled guilty to any of the following offenses:(a) A felony.(b) A gambling offense.(c) Criminal fraud.(d) Forgery.(e) Larceny.(f) Filing a false report with a governmental agency.(7) Any changes to the information provided on or attached to the gaming licenseapplication shall be immediately reported to the bureau in writing.
Additional Eligibility FactorsIn addition to the requirements of the act, the commissioner shall consider the following factors
when reviewing a gaming license application or renewal application:
(a) The honesty and integrity of the applicant.(b) The veracity and accuracy of any information supplied to the bureau by the applicant.(c) The applicant’s indebtedness to local, state, or federal government.(d) A pending lawsuit or bankruptcy proceeding involving the applicant.(e) The applicant’s current or past history of compliance with the act, these rules, terms of
probation, directives of the bureau, public policy of the state of Michigan, or any other local,state, or federal law or regulation.
(f) Criminal convictions of the applicant or any individual, officer, or agent of the applicant forany of the following offenses:(i) A violation of the act.(ii) A felony.(iii) A gambling offense.(iv) Criminal fraud.(v) Forgery.(vi) Larceny.(vii) Filing a false report with a governmental agency.(g) Any other information considered advisable by the commissioner.
Millionaire Party License• A qualified organization may receive 4
millionaire party licenses per year
• Each license can be up to 4 consecutive days
• The fee is $50 for each day of the millionaireparty
ManagementOnly the Charity can manage the event– Cash– Chips– Game Records
• The payment of expenses incurred inconnection with the conduct of the licensedgaming event shall be necessary andreasonable, but shall not exceed 50% of thegross profit. This amount does not includethe license fee.
Operation
• Provide equipment• Location• Technical Advise• Training
All License Records• 3 years + current year• A copy of the current license and application• All game (event) records• Worker Service Record• Receipts, invoices and validated deposit slips• Cancelled checks and bank Statements• Financial Statement• House rules
The Bureau Must Ensure Fairness
• Arbitrary or capricious decisions cannotbe made
• Inspectors are required to do their duediligence in investigating and reporting
• Ensure lawful reasons for denying acharity event license at unsuitablelocations
Why a Moratorium on New Locations
• Lack of staff to properly regulate• To protect the welfare of the public• Unable to effectively investigate complaints to
ensure properly, efficiently, and timelyinvestigations
• Bingo, Charity Game Ticket, Raffleinspections are suffering –all attention onTexas Hold’em
• Public Perception
Reoccurring Problems• Millionaire Party locations are not required to be
licensed limiting Charitable Gaming authority anddifficult to regulate
• Playing without license• Advertising violations• Exceeding the $15,000.00 limit• Locations handling cash, chips and game records• Embezzlement from charities• Locations inappropriately training organizations• Completing accountability forms accurately, balancing
paperwork
Proposed Improvements• Partner with other agencies, i.e. State Police, Liquor
Control Commission, our own Lottery• Possible Legislative Changes:
a) Imposing Fines—Inspectors issue citations on siteb) Fee Increasesc) License Locationsd) Limit Number of Licensees per daye) Increase $15,000 daily chip allowancef) Background Checks on location owners and dealers-would
include Financial-Credit Check (looking for debt to state andlocal government), Criminal Check, Owners of Property-lease holder, share holder
g) Tier system for licensesh) Prohibit use of the word “Casino” in Location Title
Reasons to Continue Texas Hold’em• Generates more revenue for charitable
organizations• Increases revenue for State of
Michigan’s general fund• Provides an additional gaming option to
existing and new players• Replacement to sluggish Bingo Game
fundraising• Affordable Entertainment• Allows for small business
Charitable Gaming Website
• Any questions, please feel free to contactus or check our website at: