Texas Laws for Raffles
HARLINGEN, Texas (ValleyCentral) – Gambling is illegal in Texas, and it`s not just blackjack and slot machines that are banned, but some charity raffles fall under the ban, depending on how they`re conducted. Did you know that 50/50 raffles are illegal in Texas, with the exception of professional sports team foundations? Most people wouldn`t know because 50/50 is productive in the state. All the 50/50s you see (with the exception of professional sports games) are indeed illegal. Money cannot be offered as prizes in a Texas sweepstakes. There are other rules that may be problematic at first glance. However, if you hire an experienced gambling attorney who is familiar with the Texas regulatory environment (as I did), there are plenty of gems to discover that would remain hidden from the layman. I will take a few topics directly from the Attorney General`s website and explore to highlight what the Attorney General is not telling you, but you should know. There you have it: Yes. Only random draws held under the provisions of the Raffle Enabling Act are authorized draws. An unauthorized raffle is considered a game under the Texas Penal Code.
Holding such a raffle is a Class A administrative offense. Participating in an unauthorized sweepstakes is a Class C offense. Barrera said PRCA already holds sweepstakes in other states. “These raffles are high-end. You`re dealing with four-door trailers, F-150s, F-350s, you`re dealing with $75,000 truck trailers,” he said. While only certain groups are allowed to hold raffles, the first proposal would be to add the Men`s and Women`s Professional Rodeo Cowboys Association to the list of approved raffles. Waco ISD`s internal audit has no expertise or authority with respect to the contest rules. The information contained in these guidelines serves as a general source of information. If you have specific questions about the law, please contact a lawyer who specializes in this area. For more information, please also call the attorney general`s office or visit their website in texasattorneygeneral.gov Barrera said the state allows the premises to hold “raffles for fundraising purposes” for things like cancer research and nonprofits that help the less fortunate. I am not a lawyer, but I am familiar with the various regulatory authorities. I think for charities, the laissez-faire approach to regulation is generally good for charities, but it doesn`t take many bad apples to ruin it for everyone.
No one wants the big brother to breathe in their neck, but there`s definitely a reason to forget when it comes to charity games. I think Texas has been proactive in recent years in adding Proposition 4 and Proposition 5, and I think it`s a matter of time before these types of raffles become more common. Step by step. But the boost can also help!! Canada is the birthplace of electronic lotteries and 50/50 electronic lotteries. There is much more appetite for raffles in Canada than in the U.S., as Canada does not tax raffle or lottery winnings. As a result, Canada`s not-for-profit gaming sector is more developed than that of the United States. It can be good and bad. It`s good to know exactly where you stand on each issue, as the rules are set for you and regulators proactively tell you what you can and can`t do. It`s bad for the same reasons. Often, the answers you get are “NO.” In Texas and many states, this is not the case.
Often the attorney general cites certain state laws and they have a disclaimer on their website stating that they don`t answer questions and that charities need to get a lawyer hired if they have concerns/issues that they are addressing. Texas does not require the charitable/nonprofit to obtain a license for its sweepstakes, as noted above. This should be part of the Attorney General`s due diligence process, and any issues would be reported. In my opinion, this is not a fair process for the charity. Most charities can`t afford a lawyer and may break state laws. Examples of illegal sweepstakes include: A qualified organization may only hold two sweepstakes per calendar year and only one sweepstakes at a time. Prizes cannot be advertised nationally** or through paid advertising. Each prize must contain the following information: (1) the name of the organization organizing the draw; (2) The address of the Organization or of a designated official of the Organization; (3) the price of the ticket; 4) a general description of each prize valued at more than $10; and 5) the date on which the prize(s) of the contest will be awarded.
No one will be compensated, directly or indirectly, for the organization or conduct of a sweepstakes or for the sale of lottery tickets.*** State law does not allow schools and the district to hold sweepstakes. Only random draws conducted in accordance with the provisions of the Not-for-profit Raffle Authorization Act are authorized draws. The law is Chapter 2002, Professional Code, Texas Codes Annotated. Raffle items are not necessarily illegal in Texas, although the state classifies raffles as gambling, according to the Texas attorney general. For example, schools that give gift baskets are legal if they are an approved institution. ALL net profits must go directly to the charitable cause (not future raffles or fundraisers). TX AG has interpreted the term “all products” as used in the Constitution and the CREA to mean net proceeds after payment of reasonable, incidental and necessary expenses. As a result, an organization may use the raffle proceeds to pay the reasonable, incidental and necessary costs of holding the raffle from which the proceeds originated. JC-0046 (1999). The Enabling Act for Charitable Raffles, which came into force on January 1, 1990, allows “eligible organizations” to hold up to two raffles per calendar year, subject to certain restrictions. For more information, please contact the Attorney General`s Consumer Protection Hotline at 800-621-0508.
A qualified organization is not required to register with the state before holding a prize draw. However, some restrictions apply. Proceeds from raffle ticket sales in Texas by qualified organizations may only be used for other charitable purposes. State law prohibits any form of paid advertising or promotion of a sweepstakes through media such as newspapers, television, and radio. An organization organizing a prize draw must print on the tickets the prize draw entry fee, the name and address of the organization, a description of the prizes and the date on which the prizes will be awarded. State law prohibits the awarding of money as prizes in sweepstakes. The language of the law is very technical. If you are considering holding a sweepstakes for an organization, you should review the bylaws to make sure you qualify. All consumer complaints must be filed online under Consumer Complaint or by mail. For a complaint form, see the printable complaint form.
Write to: Texas only allows places where items up to a certain value can be drawn. $50,000 for most items, but they also allow locations to draw homes as long as their rating is below $250,000. A qualified organization can offer any prize except money. “Money” is defined as coins, paper money or an exchangeable instrument that represents coins or paper money and can be easily converted into them. If the Draw Organizers offer a prize they have purchased or for which they have provided other consideration, the value of the prize cannot exceed $50,000 or $250,000 if the prize purchased is a residential apartment. There is no value limit for prizes donated to the organization.* The laws governing raffle tickets in Texas are described in Chapter 2002 of the Texas Occupations Code section entitled “Charitable Raffles”. This chapter is also known as the Enabling Act for Charitable Raffles. The law defines what constitutes a raffle ticket and which organizations have the right to sell them. The law also outlines the legal sale of raffle tickets in the state. ** The Attorney General is not telling you that for online sales, parts of Texas can be cut up and that tickets cannot be purchased and therefore the draw would not be national. Geolocation technology can do this quite simply.
