ENROLLED
COMMITTEE SUBSTITUTE
FOR
Senate Bill No. 241
(Senators Chafin, Plymale, Ross and Anderson,
original sponsors)
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[Passed March 11, 1995; in effect ninety days from passage.]
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AN ACT to repeal section fourteen, article twenty, chapter
forty-seven of the code of West Virginia, one thousand nine
hundred thirty-one, as amended; to repeal section fourteen,
article twenty-one of said chapter; to amend and reenact
sections four, ten, eleven, twelve-a, fifteen, seventeen and
twenty-four, article twenty of said chapter; to amend and
reenact sections four, eleven, fourteen, fifteen and twenty-
two, article twenty-one of said chapter; and to amend and
reenact section two, article twenty-three of said chapter, all
relating to licensure and reporting requirements relating to
charitable bingo, raffles, raffle boards or games; repealing
provisions relating to limitations on permissible amounts of
rent which may be received for premises upon which bingo and
raffle occasions are held; providing that certain junior
firemen may assist in the conduction of bingo games;prohibiting
hiring persons to advertise; allowing acceptance of personal checks by licensees; removing certain limitations on prizes
awarded during duration of bingo license period; allowing
twenty-five percent of gross proceeds to be used to pay
expenses; increasing the number of paid employees for
charitable bingo games, operating bingo games and related
concessions; requiring operators to be residents of this state;
limiting rent payments to the fair market value of the
premises; permitting nonprofit entities holding raffle and
bingo occasions receiving state or federal funds to elect
annual reporting periods which coincide with the licensee's
fiscal year; permitting licensed public accountants to compile
and review or audit records of licensed entities holding raffle
or bingo occasions; deleting requirement for audited financial
reports in accordance with certain standards; permitting
nonprofit social clubs to hold raffle license; removing certain
limitations on awards of raffle prizes; allowing thirty percent
of raffle gross proceeds from raffle license be used for
payment of expenses; and providing that persons donating raffle
or game items or services without compensation are not required
to be licensed as a wholesaler or distributor.
Be it enacted by the Legislature of West Virginia:
That section fourteen, article twenty, chapter forty-seven
of the code of West Virginia, one thousand nine hundred thirty-
one, as amended, be repealed; that section fourteen, article
twenty-one of said chapter be repealed; that sections four, ten, eleven, twelve-a, fifteen, seventeen and twenty-four,
article twenty of said chapter be amended and reenacted; that
sections two, four, eleven, fifteen and twenty-two, article
twenty-one of said chapter be amended and reenacted; and that
sections four, eleven, fifteen and twenty-two, article twenty-
three of said chapter be amended and reenacted, all to read as
follows:
ARTICLE 20. CHARITABLE BINGO.
§47-20-4. Annual license; conditions on holding of games.
A charitable or public service organization or any of its
auxiliaries or other organizations otherwise affiliated with it
may apply for an annual license. Only one license per year in
the aggregate may be granted to a charitable or public service
organization and all of its auxiliaries or other associations
or organizations otherwise affiliated with it: Provided, That
for purposes of this section the various branches, chapters or
lodges of any national association or organization or local
churches of a nationally organized church are not considered
affiliates or auxiliaries of each other. The commissioner
shall by regulation provide for the manner for determining to
which organization, whether the parent organization, an
affiliate or an auxiliary, the one license allowed under this
section is granted. An annual license is valid for one year
from the date of issuance and entitles only the licensee to
hold no more than two bingo occasions per week. No two or more organizations may hold a joint bingo occasion under any annual
licenses. No bingo occasion held pursuant to an annual license
may exceed six hours duration.
A licensee shall display its annual bingo license
conspicuously at the location where the bingo occasion is held.
All bingo occasions shall be open to the general public:
Provided, That no licensee shall permit or allow any individual
under the age of eighteen to participate in the playing of any
bingo game with knowledge or reason to believe that the
individual is under the age of eighteen: Provided, however,
That an individual under the age of eighteen may attend the
playing of a bingo game when accompanied by and under the
supervision of an adult relative or a legal guardian of said
individual: Provided further, That nothing contained herein may
be construed to prohibit junior volunteer firefighters sixteen
years of age or older from assisting the volunteer fire company
of which such junior firefighter is a member in the conduct of
an event under this article where such junior firefighter is
supervised by a senior member of the same volunteer fire
company who is over the age of twenty-one years.
Any licensee may receive and cash personal checks in an
amount not to exceed one hundred dollars during the normal
operation of a bingo game.
§47-20-10. Limits on prizes awarded -- General provisions.
Except as otherwise provided in section twenty-two of this article, during the period of a license the average total
prizes awarded by a licensee, or in the aggregate by two or
more limited occasion licensees holding a joint bingo occasion,
for any bingo occasion held pursuant to an annual or limited
occasion license, may not exceed seven thousand five hundred
dollars in value.
Prizes may be money or merchandise other than beer,
nonintoxicating beer, wine, spirits or alcoholic liquor as
defined in section five, article one, chapter sixty of this
code. If the prizes are merchandise, the value assigned to
them is their fair market value at the time of purchase.
§47-20-11. Operator of bingo games and related concessions.
Except as provided in sections thirteen and twenty-two of
this article, only persons, as defined in section two of this
article, who are residents of this state and who are active
members of the licensee organization or its authorized
auxiliary organization may participate in any manner in the
conduct of any bingo game or operate any concession in
conjunction with a bingo occasion: Provided, That
notwithstanding anything contained in this article to the
contrary, no individual under the age of eighteen years may
directly or indirectly participate in the conduct of a bingo
game.
§47-20-12a. Compensation of bingo operator; number of
employees.
(a) Within the guidelines set forth in subsections (b),
(c) and (d) of this section, a licensee may pay a salary, not
to exceed the federal minimum wage, to operators of bingo games
who are active members of the licensee organization.
(b) If the licensee's gross receipts from bingo occasions
equal or exceed one hundred thousand dollars for the licensee's
most recently filed annual financial report, a salary may be
paid to not more than five operators.
(c) If the licensee's gross receipts from bingo occasions
are less than one hundred thousand dollars, but equal or exceed
fifty thousand dollars for the licensee's most recently filed
annual financial report, a salary may be paid to not more than
three operators.
(d) If the licensee's gross receipts from bingo occasions
are less than fifty thousand dollars for the licensee's most
recently filed annual financial report, a salary may be paid to
no more than two operators.
§47-20-15. Payment of reasonable expenses from proceeds; net
proceeds disbursement.
(a) The reasonable, necessary and actual expenses incurred
in connection with the conduct of bingo occasions, not to
exceed twenty-five percent of the gross proceeds collected
during a license period, may be paid out of the gross proceeds
of the conduct of bingo, including, but not limited to:
(1) Rent paid for the use of the premises: Provided, That a copy of the rental agreement was filed with the bingo license
application and any changes thereto were filed within ten days
of being made: Provided, however, That in no event may the
rent paid for the use of any premises exceed the fair market
value of rent for such premises;
(2) The cost of custodial services;
(3) The cost to the licensee organization for equipment
and supplies used to conduct the bingo occasion;
(4) The cost to the licensee organization for advertising
the bingo occasion;
(5) The cost of hiring security personnel, licensed
pursuant to the provisions of article eighteen, chapter thirty
of this code; and
(6) The cost of providing child care services to the
raffle patrons: Provided, That any proceeds received from the
provision of child care services shall be handled the same as
raffle proceeds.
(b) The actual cost to the licensee for prizes, not to
exceed the amounts as specified in section ten of this article,
may be paid out of the gross proceeds of the conduct of bingo.
(c) The cost of any refreshments, souvenirs or any other
item sold or otherwise provided through any concession to the
patrons may not be paid for out of the gross proceeds from the
bingo occasion. The licensee shall expend all net bingo
proceeds and any interest earned thereon for the charitable or public service purposes stated in the application within one
year after the expiration of the license under which the bingo
occasions were conducted. A licensee which does not qualify as
a qualified recipient organization may apply to the
commissioner at the time it applies for a bingo license or as
provided in subsection (e) of this section for permission to
apply any or all of its net proceeds to directly support a
charitable or public service activity or endeavor which it
sponsors.
(d) No gross proceeds from any bingo operation may be
devoted or in any manner used by any licensee or qualified
recipient organization for the construction or acquisition of
real or personal property except that which is used exclusively
for one or more charitable or public service purposes or as
provided in subdivision (3), subsection (a) of this section.
(e) Any licensee which, in good faith, finds itself unable
to comply with the requirements of this provision shall apply
to the commissioner for permission to expend its net proceeds
for one or more charitable or public service purposes other
than that stated in its license application or for permission
to expend its net proceeds later than the one-year time period
specified in this section. The application shall be on a form
furnished by the commissioner and shall include the particulars
of the requested changes and the reasons for the changes. The
application shall be filed no later than sixty days before the end of the one-year period specified in this section. In the
case of an application to extend the time in which the net
proceeds are to be expended for a charitable or public service
purpose, the licensee shall file such periodic reports with the
commissioner as the commissioner directs until the proceeds are
so expended.
§47-20-17. Advertising.
A licensee may advertise its bingo occasions in a manner
reasonably necessary to promote the occasion: Provided, That
a licensee may not hire any person, as defined in section two
of this article, to develop or conduct an advertising campaign
to promote any bingo occasion.
§47-20-24. Filing of reports.
Each licensee holding an annual license shall file with
the tax commissioner a quarterly and an annual financial report
summarizing its bingo operations for the time period covered by
the report. Each quarterly report shall be filed within twenty
days after the end of the quarter which it covers. The annual
report shall be filed within thirty days after the expiration
of the license under which the operations covered by the report
were held. The time period covered by the annual report is the
full license year or, at the election of a licensee receiving
state or federal funding, the most recently ended state or
federal fiscal year.
Each licensee holding a limited occasion license or state fair license shall file with the tax commissioner a financial
report summarizing its bingo operations for the license period
within thirty days after the expiration of the license under
which the operations covered by the report are held. The
report shall contain the name, address and social security
number of any individual who receives during the course of a
bingo occasion prizes the aggregate value of which exceeds one
hundred dollars, and other information required by the
commissioner: Provided, That any licensee failing to file such
report when due shall be liable for a penalty of twenty-five
dollars for each month or fraction thereof during which the
failure continues, such penalty not to exceed one hundred
dollars: Provided, however, That annual financial reports for
years ending after the first day of July, one thousand nine
hundred ninety-three, must contain a compilation and review of
such financial report by a certified or licensed public
accountant, or may be audited by a certified or licensed public
accountant, if a licensee's gross receipts exceed fifty
thousand dollars.
ARTICLE 21. CHARITABLE RAFFLES.
§47-21-4. Who may hold raffles; application for license;
licenses not transferable.
(a) Except as provided in section three of this article,
only persons, as defined in section two of this article, who
are residents of this state and who are active members of any charitable or public service organization which has been in
existence in this state for at least one year prior to filing
an application for a raffle license issued pursuant to section
five or six of this article may hold raffle occasions in
accordance with the provisions of this article during such time
as it holds a valid license.
(b) Application for a raffle license shall be made to the
tax commissioner and shall be on a form which shall be supplied
by him. The application shall contain the information required
by section eight of this article and any other information
which the commissioner considers necessary. An application
shall be filed not less than sixty days before the date when
the applicant intends to hold its first raffle occasion. An
application which is not denied within thirty days after filing
is considered approved and the commissioner shall, within five
days after the expiration of such thirty days, send to the
applicant its license.
(c) For purposes of this article, any application for an
annual license or a limited occasion license received prior to
the effective date of this article is considered filed on such
effective date.
(d) No raffle license issued pursuant to this article may
be transferred.
§47-21-11. Limits on prizes awarded -- General provisions.
During the period of a license, the total prizes awarded by a licensee, or in the aggregate by two or more limited
occasion licensees holding a joint raffle occasion, for any
raffle occasion held pursuant to a limited occasion license,
may not exceed in value seven thousand five hundred dollars.
Prizes may be money, real or personal property or
merchandise other than beer, wine, spirits or alcoholic liquor
as defined in section five, article one, chapter sixty of this
code. If the prizes are real or personal property or
merchandise, the value assigned to them is their fair market
value at the time of acquisition for the raffle or at the time
of purchase.
§47-21-15. Payment of reasonable expenses from proceeds; net
proceeds disbursement.
(a) The reasonable, necessary and actual expenses incurred
in connection with the conduct of raffle occasions, not to
exceed twenty-five percent of the gross proceeds collected
during a license period, may be paid out of the gross proceeds
of the conduct of raffle, including, but not limited to:
(1) Rent paid for the use of the premises: Provided, That
a copy of the rental agreement was filed with the raffle
license application with any modifications thereto to be filed
within ten days of being made: Provided, however, That in no
event may the rent paid for the use of any premises exceed the
fair market value of rent for such premises;
(2) The cost of custodial services;
(3) The cost to the licensee organization for equipment
and supplies used to conduct the raffle occasion;
(4) The cost to the licensee organization for advertising
the raffle occasion;
(5) The cost of hiring security personnel, licensed
pursuant to the provisions of article eighteen, chapter thirty
of this code; and
(6) The cost of providing child care services to the bingo
patrons: Provided, That any proceeds received from the
provision of child care services shall be handled the same as
bingo proceeds.
(b) The actual cost to the licensee for prizes, not to
exceed the amounts as specified in section eleven of this
article, may be paid out of the gross proceeds of the conduct
of raffle.
(c) The cost of any refreshments, souvenirs or any other
item sold or otherwise provided through any concession to the
patrons may not be paid for out of the gross proceeds from the
raffle occasion. The licensee shall expend all net raffle
proceeds and any interest earned thereon for the charitable or
public service purposes stated in the application within one
year after the expiration of the license under which the raffle
occasions were conducted. A licensee which does not qualify as
a qualified recipient organization may apply to the
commissioner at the time it applies for a raffle license or as provided in subsection (e) of this section for permission to
apply any or all of its net proceeds to directly support a
charitable or public service activity or endeavor which it
sponsors.
(d) No gross proceeds from any raffle operation may be
devoted or in any manner used by any licensee or qualified
recipient organization for the construction, acquisition,
improvement, maintenance or repair of real or personal property
except that which is used exclusively for one or more
charitable or public service purposes or as provided in
subdivision (3), subsection (a) of this section.
(e) Any licensee which, in good faith, finds itself unable
to comply with the requirements of the foregoing provisions of
this section shall apply to the commissioner for permission to
expend its net proceeds for one or more charitable or public
service purposes other than that stated in its license
application or for permission to expend its net proceeds later
than the one-year time period specified in this section. The
application shall be on a form furnished by the commissioner
and shall include the particulars of the requested changes and
the reasons for the changes. The application shall be filed no
later than sixty days before the end of the one-year period
specified in this section. In the case of an application to
extend the time in which the net proceeds are to be expended
for a charitable or public service purpose, the licensee shall file such periodic reports with the commissioner as the
commissioner directs until the proceeds are so expended.
§47-21-22. Filing of reports.
Each licensee holding an annual, limited or state fair
license shall file with the commissioner a financial report
summarizing its raffle operations within thirty days after the
expiration date of such license. The time period covered by an
annual report is the full license year or, at the election of
a licensee receiving state or federal funding, the most
recently ended state or federal fiscal year.
The reports required by this section shall contain the
name, address and social security number of any individual who
received during the course of a raffle occasion prizes the
aggregate value of which exceeded one hundred dollars, and
other information required by the commissioner: Provided, That
any licensee failing to file such report when due shall be
liable for a penalty of twenty-five dollars for each month or
fraction thereof during which the failure continues, such
penalty not to exceed one hundred dollars: Provided, however,
That annual financial reports for license years ending after
the first day of July, one thousand nine hundred ninety-three,
must contain a compilation and review of such financial report
by a certified or licensed public accountant, or may be audited
by a certified or licensed public accountant, if a licensee's
gross receipts exceed fifty thousand dollars.
ARTICLE 23. CHARITABLE RAFFLE BOARDS AND GAMES.
§47-23-2. Definitions.
For purposes of this article, unless specified otherwise:
(a) "Commissioner" means tax commissioner of the state of
West Virginia, or his delegate.
(b) "Retail value" means the actual consideration paid to
the wholesaler by the retailer for any raffle boards or games.
(c) "Person" means any individual, association, society,
incorporated or unincorporated organization, firm, partnership
or other nongovernmental entity or institution.
(d) "Retailer" means every person engaged in the business
of making retail sales of raffle chances except a charitable or
public service organization authorized to conduct raffles
pursuant to section three, article twenty-one of this chapter.
(e) "Charitable raffle board" or "charitable raffle game"
means: (1) A board or other device that has many folded
printed slips to be pulled from the board or otherwise
distributed without a board on payment of a nominal sum in an
effort to obtain a slip or chance that entitles the player to
a designated prize; (2) a series of paper cards with perforated
break-open tabs, a face value of which is covered or otherwise
hidden from view to conceal one or more numbers, letters or
symbols, which, on payment of a nominal sum, entitles the
player to obtain a chance to a designated prize; or (3) such
other similar game which may be defined by the state tax commissioner by legislative rule.
(f) "Sale" means the transfer of the ownership of tangible
personal property for a consideration.
(g) "Verification" means a unique manufacture identifiable
serial number which is required to be printed on each ticket in
a charitable raffle board or charitable raffle game or such
other form of identification as may be prescribed by the tax
commissioner upon a showing of undue hardship by the taxpayer:
Provided, That such other form of identification shall be
prescribed by rule in accordance with the provisions of article
three, chapter twenty-nine-a of this code.
(h) "Wholesaler" or "distributor" means any person or
entity engaged in the wholesale distribution of charitable
raffle boards or games or similar boards or devices, as defined
by the commissioner, and licensed under the provisions of this
article, to distribute said devices to charitable raffle boards
or games retailers as defined in this article. It also
includes anyone who is engaged in the manufacturing, packaging,
preparing or repackaging of charitable raffle boards or games
for distribution in this state: Provided, That no license
taxes or other fees provided for in this section may be charged
to any newspaper or other printing or duplicating operation not
regularly engaged in the business of manufacturing, packaging,
preparing or repackaging charitable raffle boards or games
where the gross sales of such printing or duplicating operation from such activity does not exceed seven thousand five hundred
dollars per calendar year and who is donating such items or
services to a nonprofit entity without compensation may not be
considered a "wholesaler" or "distributor" under this article.