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REV-1750 -- Small Games of Chance Overview

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REV-1750 -- Small Games of Chance Overview Pennsylvania Department of Revenue REV-1750 Small Games of Chance Overview REV-1750 (SU) 11-19 club licensees), and for-profit taverns to conduct limited DISCLAIMER types of gambling. The Pennsylvania Department of Revenue has prepared TYPES OF GAMES this overview on Pennsylvania’s Local Option Small Games of Chance Act, 1988 P.L. 1262, No. 156, as amended, for LICENSED ELIGIBLE ORGANIZATIONS use by the general public. This overview is for informational Licensed eligible organizations are authorized to conduct the purposes only. Nothing contained herein should be following games of chance: considered legal advice. Any person or entity with legal questions regarding the Local Option Small Games of • Pull-tab games. Chance Act should review the provisions of the Act for • Punchboards. guidance or consult private legal counsel. • Raffles (including special permit raffles). INTRODUCTION • Daily drawings. • Weekly drawings. The Pennsylvania Crimes Code provides that all forms of gambling are illegal unless the Pennsylvania Legislature • Fifty-fifty (50/50) drawings. specifically authorizes the gambling activity by statute. • Race Night Games. Gambling exists when there is a payment of consideration • Pools. or a fee or something of value for the opportunity for a prize Tavern Gaming Licensee or reward, the winner of which is determined by chance. Tavern gaming licensees are authorized to conduct the Effectively, the three elements are: (1) consideration, (2) following types of games, known as “tavern games”: chance and (3) prize or reward. • Pull-tab games. Currently, the only authorized and legal forms of gambling in Pennsylvania are: • Tavern raffles, which are limited to once a month and must designate at least half of net revenue to a • Those gambling activities conducted pursuant to the designated charity. Race Horse Industry Reform Act. • Tavern daily drawings. • Pennsylvania Lottery (including Powerball and Mega Millions). TYPES OF LICENSES • Bingo conducted pursuant to the Bingo Law. Eligible Organization Licenses • Those gambling activities conducted pursuant to the There are two types of licenses available to eligible Pennsylvania Race Horse Development and Gaming organizations: A regular license and a monthly license. An Act (Slots and Table Games). eligible organization may conduct all forms of games of • Those gambling activities conducted pursuant to the chance under either license type. See page 1 for the types Local Option Small Games of Chance Act. of games of chance an eligible organization may conduct. • Those gambling activities conducted pursuant to the • Regular License: A regular license is an annual Sport Raffle Charities Act (SRCA). license, and the term runs for a calendar year from the date of issuance. The fee for an annual license is $125. This overview discusses the gambling activities conducted pursuant to the Local Option Small Games of Chance Act. • Monthly License: A monthly license is valid for 30 consecutive days from the date of issuance. There is The Pennsylvania Local Option Small Games of Chance Act no restriction on the number of monthly licenses an was passed in 1988 and has been amended several times eligible organization may obtain, but the licenses may since its enactment, most notably by Acts 2 and 184 of 2012 not overlap. The fee for a monthly license is $25. and Acts 90 and 92 of 2013. • Special Raffle Permits: Special raffle permits are The small games of chance law authorizes certain non-profit available to regular and monthly licensees. The organizations, known as eligible organizations (including special raffle permit authorizes a holder to conduct a www.revenue.pa.gov REV-1750 1 raffle that exceeds the normal prize limits applicable • Random audits of 5 percent of club licensees every two to games of chance. As a general rule, a licensed years. eligible organization may obtain up to 10 special raffle • Administration of the state and host municipality tavern permits. Total prizes awarded under all special raffle games taxes. permits may not exceed $150,000. Volunteer fire, • Limited regulatory authority related to manufacturer ambulance, rescue or conservation organizations registration, distributor licensing, games of chance and may obtain up to 12 special raffle permits and award games of chance records and reports. up to $250,000 in prizes. For a licensed eligible organization with a regular license, the organization PLCB can receive either 10 or 12 special raffle permits The PLCB is responsible for licensing taverns to conduct during the annual license term. Because a licensed tavern games in the commonwealth, and it may also impose eligible organization that obtains only a monthly penalties for tavern licensees’ violation of small games of license does not have an annual licensed term, such chance law, including suspension or revocation of tavern organization may receive no more than 10 or 12 gaming licenses. special permits in any calendar year. PGCB Tavern Gaming Licenses The PGCB’s Bureau of Investigations and Enforcement is There is only one type of license available to a tavern: a responsible for conducting background investigations of tavern gaming license. Taverns that obtain a tavern gaming each tavern game license applicant. license from the Pennsylvania Liquor Control Board (PLCB) Law enforcement officials are authorized to offer pull-tab games, tavern raffles and Commonwealth law enforcement officials – including local tavern daily drawings. police, state police, the Bureau of Liquor Control The tavern gaming license is an annual license issued and Enforcement, local district attorneys and the Attorney renewed by the PLCB. For additional information about the General – are responsible for overseeing the operation of tavern gaming licensing process, visit www.lcb.pa.gov. games of chance and for bringing civil and criminal charges against organizations and individuals for violations of the law. ADMINISTRATION AND ENFORCEMENT Information Sharing: The government entities responsible Small games of chance law is administered and enforced for administering and enforcing small games of chance law by several different government entities: licensing are allowed to share information and documentation for purposes of administering and enforcing the law. authorities, the Department of Revenue, the PLCB, the Pennsylvania Gaming Control Board (PGCB) and law SALE/PURCHASE OF GAMES OF CHANCE enforcement officials. Licensing Authorities Pull-tab games, punchboards and race night games for use in the commonwealth may only be produced by The licensing authorities for club licensees and eligible manufacturers registered with the Department of Revenue. organizations seeking to offer small games of chance are Distributors may only purchase small games of chance from the county treasurers in each of Pennsylvania’s 67 counties. registered manufacturers, and taverns and eligible Where there is no county treasurer, such as in a home-rule organizations licensed to sell small games of chance must county or city of the first class, the licensing authority is the purchase them from distributors licensed by the Department designee of the governing body. The licensing authority is of Revenue. Listings of small games of chance responsible for licensing eligible organizations to conduct manufacturers and distributors are available at games of chance in the commonwealth and for issuing www.revenue.pa.gov/SGOC. special raffle permits. For tavern gaming, the PLCB is the licensing authority. Tickets and other products used to play other types of games of chance do not have to be purchased from a registered Department of Revenue manufacturer or licensed distributor. Only licensed eligible The department is charged with several responsibilities organizations, including club licensees, and tavern gaming under small games of chance law, as follows: licensees may purchase and operate games of chance in the commonwealth. • Registration of games of chance manufacturers. • Reviewing and approving pull-tab games and ELIGIBLE ORGANIZATIONS punchboards for use in the commonwealth. An eligible organization is one of the following types of • Licensing of distributors to sell pull-tabs, punchboards entities: a charitable, religious, fraternal or veterans’ and race night games for use in the commonwealth. organization; a club, civic and service association; or an • Receipt and retention of games of chance reports affiliated non-profit organization of a major league sports from clubs. team. An eligible organization must be in existence and 2 REV-1750 www.revenue.pa.gov fulfilling its purpose for one year in order to be eligible for a • No more than $15,000 may be awarded in raffles games of chance license. during a calendar month. An auxiliary group of an eligible organization is not an Limited exceptions to the prize limits exist: eligible organization and is not eligible for its own small • Raffles conducted under a special permit: Licensed games of chance license. However, an auxiliary group may eligible organizations can apply to the county treasurer conduct games of chance using the license of its parent for special permits. Raffles conducted under a special eligible organization so long as the auxiliary group is listed permit are not subject to the general prize limitations on the eligible organization’s license application. All games above. Licensed eligible organizations are eligible to of chance conducted by the auxiliary group are considered receive up to 10 special permits and may award up to as
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