WELCOME INDIANA GAMING COMMISSION CHARITY GAMING DIVISION 2013 Indiana Non Profit Resource Network Workshop Director Diane Freeman Executive Director Ernest.

WELCOMEINDIANA GAMING COMMISSION

CHARITY GAMING DIVISION

2013 Indiana Non Profit Resource Network Workshop

Director Diane FreemanExecutive Director Ernest E. Yelton

Charity Gaming Basics

QualifiedRaise money for your charitable

purposesUsing your volunteers (can’t pay)

8 types of licenses Singles/AnnualsSingle---date, time, location specificAnnual----3 days a week time and

location specificHow do we conduct 50/50’s at our

meetings------Exempt EventsIllegal Gaming 3-elements

Types of Events Allowed • Bingo • Charity Game Night• Door Prize• Water Race• Guessing Game• Raffle• Annual PPT• Festival• Exempt Events

Legislative & Administrative Rule Changes

Senate Enrolled Act 340 & 315 Effective July 1, 2011 and July 1, 2012, respectively

Statutory Changes – SEA 340• Volunteer Ticket Agents

– Acts as a third-party vendor for tickets (think retail merchant)– New section on forms if using a VTA

• Bingo Workers– Allows a worker at a bingo event whose duties are limited to selling

bingo supplies or tickets to participate– Worker must have completed all duties prior to the start of the first

bingo game and may not be engaged as a worker at any other time during the bingo event.

• Credit Cards– Allowed for purchases of food, beverages, merchandise, and retail

goods and services offered at benefit auction. – Use of credit cards to purchase of a chance to play any game of

chance offered at an allowable event is prohibited

Statutory Changes – SEA 340

• Related Activities– Removes related activities from the calculation of total

gross revenue. – A qualified organization is no longer required to report

revenue generated from related activities (e.g., dinner tickets, concessions, retail sales) as part of its total gross revenue.

• Festivals– Increases the number of days a qualified organization may

conduct a festival (5 days).

Statutory Changes – SEA 315• Qualification Status Change

– Decreases existence requirement from five (5) to three (3) years for organizations seeking qualification status.

• Annual Comprehensive License– Permits national organizations and foundations to conduct raffles

and door prizes under one umbrella license.– Works well for conservation or other organizations who primarily

conduct raffles at banquet dinners.

• Qualified Card Game– Euchre, Texas Hold ‘em poker, Omaha poker. New IC 4-32.2-2-23.3.

Statutory Changes – SEA 315• Texas Hold ‘em & Omaha Poker

– New IC 4-32.2-5-14.5– Patrons may take turns dealing, but are not permitted to play the

hand they deal.– The dealer shall submit the deck to be cut to the nearest player to

the right of the dealer.• IGC Interpretation: Person may either pass or cut.

– A blank card must be at the bottom of the deck.• IGC Interpretation: Blank card means a non-playing card.

– An operator or worker shall deal the cards at the final table of the tournament.

– Proposed rule: A minimum of two operators for an event, maintaining a ratio of at least one operator per forty (40) players

Administrative Rule Proposed Changes

• With passage of SEA 315 & 340, changes were needed to make the rule consistent with the new statute.

• A new administrative rule is in process of being adopted.

• Charity gaming emergency rule 12-461(E) is effective August 3, 2012 and expires November 1, 2012, – A new emergency rule will become effective at that time and

will include minor clarifications of SEA 315 and SEA 340, which became effective July 1, 2011.

– New proposed rule will include address all of the legislative changes in these two bills.

Administrative Rule Proposed Changes • Clarifies the definitions of operators and workers.

– An operator is defined as any member of a qualified org that is responsible for performing functions directly associated with gaming activities, including, but not limited to:• accounting for money received and disbursed at the gaming

event;• keeping records of the gaming event;• announcing the letter/number combination at a bingo event;• conducting qualified drawings (e.g. raffle, winner take all, or door

prize);• determining the winner in a guessing game or a water race;• determining the flare and seal card winner; • controlling the mixing and distributing of pull tabs;• redeeming a pull tab, punchboard, or tip board valued more than

$50;• performing any task of a worker; and• a remunerated bartender designated on a qualified organization’s

annual PPT or raffle license.

Administrative Rule Proposed Changes

– A worker is defined as a member of a qualified organization who assists in conducting gaming activities, including, but not limited to the following:• selling pull tabs, punchboards, and tip boards;• selling bingo supplies;• dealing cards at a card game other than euchre;• selling tickets or chances to an allowable event; and• redeeming pull tabs, punchboards, and tip boards

valued $50 or less.

• Leases, subleases, and donation statements– Must state that the lessor, sublessor, or donor understands that

gaming activity will be conducted on the property.• Banking account

– Separate and segregated charity gaming bank account must be a checking account.

– If an organization donates charity gaming revenue to an auxiliary or subsidiary organization, then that auxiliary or subsidiary organization must place the money into its own separate and segregated charity gaming checking account.

– If an organization uses the non-member participation exception and donates money to the non-member’s organization, the non-member’s organization must place the money into its own separate and segregated charity gaming checking account.

– Money deposited into a separate and segregated charity gaming bank account may not be transferred to another account.

Administrative Rule Proposed Changes

Administrative Rule Proposed Changes

• Bingo– Organizations must follow the NAGRA bingo standards.

• Advertisements– Advertisements in printed media (newspapers, magazines, internet

websites, fliers, yard signs, billboards, and marquee advertisements) must contain the name and the current event license number of the organization conducting the event.

• Volunteer Ticket Agents– A qualified organization using VTAs must maintain a ledger to

record the date of the allowable event, name, address, and telephone number of each VTA along with the name of the retail establishment where the VTA sold tickets, and the sequential numbers of the tickets provided to the retail establishment.

– Tickets sold by a VTA are licensed supply and must be purchased from a licensed distributor.

Administrative Rule Proposed Changes

• Non-cash prizes– A qualified organization must use the fair market retail

value of any non-cash prize awarded to a winner of an allowable event to determine the applicable prize payout for the event.

• Increase in processing time for all applications– A qualification application – 120 business days– First time annual application – 120 business days– Single event application – 45 business days

Smoking Ban

• General rule: Smoking is prohibited in a public place. See generally, IC 7.1-5-12.

– Exemptions: Casinos, race tracks, OTBs; fraternal clubs are exempt under certain circumstances

• Fraternal clubs, among other requirements: Separate smoking area, properly ventilated, does not allow children under 18 to enter, must have voted to allow, provides food and alcohol to their members or guests, meets the definition of fraternal club as defined in IC 7.1-3-20-7.

• Alcohol & Tobacco Commission is primarily responsible for administering the statewide ban

• Statewide ban does not preclude a city, town, or local governmental unit from enacting a more restrictive ban

INVESTIGATIONS

• Commission may conduct investigations to provide for the security and integrity of the operation of allowable events.

• Enter the premises where an allowable event is or has been conducted.

• Remove necessary equipment.• Full access to all financial records.• Inspect the premises.

Investigations---Violations• Failure to maintain accurate financial records.• Operators not on license.• “No Tipping” signs not posted.• Participation in games by operators/workers.• License (s) not posted.• No separate/segregated charity gaming account.• Transfer of money from charity gaming account.• Contracting• Illegal games: ie NASCAR BOARDS• Gaming without a License---but we did not keep any

money!!!!!!

Investigations--violations cont’d

• Not using U.S. Currency• Checks, Debit Cards, Cash• Computer records not supported with original

accounting documents (Event Summary Report)

• Bingo Caller not an operator• Grandfathered equipment• No profit on cumulative totals

Investigations--violations cont’d• Paying of Worker/Operators• Multiple licenses all money into one account.• Queen of Hearts (similar boards)• Raffle boards Raffle vs. Bingo License.• Amusement machines paying out• Bar Bingo….Bartender• Donations at gaming events• Club Special last sale cards

ALLOWABLE EXPENSES / USE OF PROCEEDS

• Indiana Code 4-32.2-5-3 (a) states that all net proceeds from an allowable event may be used only for the lawful purposes of the qualified organization. Below is a list of items for which charity gaming funds may be used. Expenses must be related to the purpose of the organization as outlined in the organization’s constitution or by-laws. This list may not be all inclusive. Other expenses not listed below are to be approved by the Commission.

• Donations of money given to an individual or organization must be by check written directly from the organization’s charity gaming account. Items (clothing, food, house wares) donated to an individual or organization must be purchased by check written directly from the charity gaming account. You must have a receipt to verify the expense and to whom the item(s) was donated. If you are reimbursing an individual, a receipt must be obtained from that individual and payment must be issued by check from the charity gaming account.

• Funds from the charity gaming account can not be transferred to other financial accounts.

• Donations of money or items issued to organizations or individuals• Mortgage/Rent Payments• Property tax• Insurance on building where organization is located and/or where the

organization conducts gaming• Utilities – Electric, Water, Gas, Telephone, Internet, does not include cable

television• Maintenance – Inside and outside – including, but not limited to,

expenses such as snow and trash removal, lawn care, etc...• Remodeling/Improvements (this does not include improvements specific

to the Bar, Kitchen or Restaurant areas)• Security systems and monitoring. An organization may employ not more

than three (3) nonmember Indiana law enforcement officers or private detectives properly licensed in Indiana to perform security services during an allowable event. An organization may not use more than three (3) security personnel unless the organization has prior written approval of the executive director or the executive director's designee.

• Contracts for janitorial services, but not janitor salaries• Monthly Tax Return for Wagers, Federal Form 730• Occupational Tax and Registration Return for Wagering, Federal Form 11-

C• Attorneys retained for the organization’s creation or for charity gaming

related issues• CPA’s/Accountants – Specific to charity gaming related issues• Charity gaming equipment, supplies and devices• Charity gaming license fees• Charity gaming specific printing , such as newspapers postings,

advertisements or flyers• Travel and lodging to and from charity gaming informational seminars• Travel and lodging by specific members, if required by the organization’s

constitution or bylaws to attend such meetings

Expenses Not Allowed

• Salaries / Benefits (i.e. insurance, 401k)• Taxes – employee federal, state or county withholding taxes,

sales tax, etc• Alcoholic Beverage Taxes• Alcohol, Beer, Wine, etc.

Event Summary Reports

• Bingo – Event Summary Report• Charity Game Night – Event Summary Report• Raffle – Event Summary Report• PPT – Event Summary Report• Door Prize – Event Summary Report• Festival – Event Summary Report• Water Race – Event Summary Report• Guessing Game – Event Summary Report• Exempt events