S.B. 186
128th General Assembly
(As Introduced)
Sens. Schuring, Grendell
BILL SUMMARY
· Authorizes a charitable organization licensed to conduct instant bingo to purchase, lease, and use instant bingo ticket dispensers.
· Specifies that instant bingo ticket dispensers are not slot machines.
· Allows a charitable organization to spend a reasonable amount of its gross profit to pay property taxes and assessments on the premises where the organization conducts bingo.
· Changes the fees charged for a license to conduct instant bingo.
CONTENT AND OPERATION
Current law authorizes a charitable organization as defined in the Charitable Gambling Law (see "What is a "charitable organization"?" below in COMMENT) to obtain a license to conduct instant bingo (1) at a bingo session where regular bingo games are conducted or (2) at other than a bingo session (R.C. 2915.08). "Instant bingo" means a form of bingo that uses folded or banded tickets or paper cards with perforated break-open tabs, a face of which is covered or otherwise hidden from view to conceal a number, letter, or symbol, or set of numbers, letters, or symbols, some of which have been designated in advance as prize winners (R.C. 2915.01(FF)).
Current law prohibits a charitable organization that conducts instant bingo from purchasing, leasing, or using instant bingo ticket dispensers to sell instant bingo tickets or cards (R.C. 2915.091(A)(16)). "Instant bingo ticket dispenser" means a mechanical device that dispenses an instant bingo ticket or card as the sole item of value dispensed and that has the following characteristics: (1) is activated upon the insertion of United States currency, (2) performs no gaming functions, (3) does not contain a video display monitor or generate noise, (4) is not capable of displaying any numbers, letters, symbols, or characters in winning or losing combinations, (5) does not simulate or display rolling or spinning wheels, (6) is incapable of determining whether a dispensed bingo ticket or card is a winning or nonwinning ticket or card and requires a winning ticket or card to be paid by a bingo game operator, (7) may provide accounting and security features to aid in accounting for instant bingo tickets or cards it dispenses, and (8) is not part of an electronic network and is not interactive (R.C. 2915.01(SS)).
The bill eliminates the prohibition against a charitable organization purchasing, leasing, or using instant bingo ticket dispensers and explicitly authorizes a charitable organization to do so (R.C. 2915.091(A)(16) and (B)(2)). The bill also specifies that a slot machine does not include an instant bingo ticket dispenser. (R.C. 2915.01(VV)(2)).
Current law specifies the annual fees that a charitable organization must pay to the Attorney General to conduct bingo, instant bingo at a bingo session, or instant bingo other than at a bingo session. The annual fee to conduct bingo is $200. The fees for a license to conduct instant bingo at a bingo session or instant bingo other than at a bingo session is based upon the gross profits[1] received during the one-year period ending on the 31st day of October of the year immediately preceding the year for which the license is sought. (R.C. 2915.08(A)(1)(b)). So, currently, if the gross profits is $50,000 or less, the fee is $500. If the total is more than $50,000 but less than $250,001, the fee is $1,250 plus one fourth per cent of the gross profits. The fee is $2,250 plus one half per cent of the gross profits if the total is more than $250,000 but less than $500,001. The fee is $3,500 plus one per cent of the gross profits, if the total is more than $500,000 but less than one million one dollars. And if the total is one million one dollars or more, the fee is $5,000 plus one per cent of the gross profit. The bill retains the current fee amounts but eliminates the additional percentages of gross profits. So, for example, the fee is $1,250 if the total is more than $50,000 but less than $250,001; the additional one fourth per cent of gross profit is eliminated and thus is not added to the base fee of $1,250, and so forth.
Under current law net profit means gross profit[2] minus expenses. Expenses means the reasonable amount of gross profit actually expended for the following: the purchase or lease of bingo supplies, the annual charitable bingo license fee, bank fees and service charges for a bingo session or game account, audits and accounting services, safes, cash registers, hiring security personnel, advertising bingo, renting premises in which to conduct a bingo session, tables and chairs, expenses for maintaining and operating a charitable organization's facilities, and any other product or service directly related to the conduct of bingo that is authorized in rules adopted by the Attorney General. By including the payment of real property taxes and assessments that are levied on a premises on which bingo is conducted as an allowable expense, the bill allows a charitable organization to spend a reasonable amount of its gross profit to pay property taxes and assessments. (R.C. 2915.01(LL)(12).)
COMMENT
Under the Charitable Gambling Law, a "charitable organization" is any tax-exempt religious, educational, veteran's, fraternal, sporting, service, nonprofit medical, volunteer rescue service, volunteer firefighter's, senior citizen's, historic railroad educational, amateur athletic, youth athletic, or youth athletic park organization. A charitable organization must be tax exempt under subsection 501(a) and be described in subsection 501(c)(3), 501(c)(4), 501(c)(7), 501(c)(8), 501(c)(10), or 501(c)(19) of the Internal Revenue Code. (R.C. 2915.01(H).)
Subsection 501(c)(3) concerns corporations, and any community chest, fund, or foundation, organized and operated exclusively for religious, charitable, scientific, testing for public safety, literary, or educational purposes, or to foster national or international amateur sports competition, or for the prevention of cruelty to children or animals, no part of the net earnings of which inures to the benefit of any private shareholder or individual, no substantial part of the activities of which is carrying on propaganda, or otherwise attempting, to influence legislation, and which does not participate in, or intervene in, any political campaign on behalf of or in opposition to any candidate for public office.
Subsection 501(c)(4) describes civic leagues or organizations not organized for profit, but operated exclusively for the promotion of social welfare, or local associations of employees, the membership of which is limited to employees of a designated person or persons in a particular municipality, and the net earnings of which are devoted exclusively to charitable, educational, or recreational purposes.
Subsection 501(c)(7) describes clubs organized for pleasure, recreation, and other nonprofitable purposes, substantially all of the activities of which are for these purposes and no part of the net earnings of which inures to the benefit of any private shareholder.
Subsection 501(c)(8) describes fraternal organizations operating under the lodge system or for the exclusive benefit of the members of a fraternity itself operating under the lodge system, that provide payment of life, sick, accident, or other benefits to their members and their members' dependents, and subsection 501(c)(10) describes domestic fraternal organizations operating under the lodge system that devote their net earnings exclusively to religious, charitable, scientific, literary, educational, and fraternal purposes and do not provide for the payment of life, sick, accident, or other benefits.
Subsection 501(c)(19) describes certain veteran organizations and their auxiliaries.
HISTORY
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ACTION |
DATE |
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Introduced |
10-15-09 |
s0186-i-128.docx/kl