Disclaimer: This article offers general information and is not intended as legal or professional advice. You should consult with legal counsel regarding your specific situation. While the information presented is believed to be factual and current as of July 27, 2021, its accuracy is not guaranteed and it should not be regarded as a complete analysis of the subject discussed.
Charitable gaming is a fun and highly effective way for nonprofit organizations to raise funds and rally the community around an important cause. Some examples of games and activities that can help with online fundraising include Catch the Ace, 50/50 raffles and many more.
When you’re organizing an online charitable game of any kind, it’s essential to read up on the laws surrounding the practice in your area. Most states have strict laws and regulations in place around charitable gaming, so if you hope to avoid getting charged or incurring a fine, it’s important to be aware of the rules.
Charitable gaming and raffles regulatory guidance for Michigan
How does the state of Michigan define charitable gaming?
As part of the Michigan Lottery, the state’s Charitable Gaming Division is responsible for the licensing, oversight, and regulation of bingo, raffles, and charity game tickets.
The passing of the Traxler-McCauley-Law-Bowman Bingo Act in 1972 allowed qualified nonprofit organizations to engage in charitable gaming fundraising, as well as the licensing of suppliers and bingo halls. The act has been amended since that time, but it essentially defines charitable gaming as bingos, raffles and other games of chance being conducted for charitable purposes.
The act provides several other definitions related to charitable gaming including bingo, which it defines as “a game of chance in which prizes are awarded on the basis of designated numbers or symbols conforming to numbers or symbols selected at random.”
In the act, the state also notes that a gaming license is defined as “a valid large bingo, small bingo, special bingo, large raffle, small raffle, annual charity game ticket, special charity game ticket, or numeral game license issued by the bureau.”
Who can conduct charitable gaming events in Michigan?
In Michigan, only qualified nonprofit organizations may apply for a charitable gaming license. Any organizations that have not previously qualified for a license must provide the proper qualification information and documents.
Licensing requirements for charitable gaming in Michigan
The Traxler-McCauley-Law-Bowman Bingo Act sets out several requirements surrounding which nonprofit organizations may apply for a gaming license in Michigan. Some of these requirements include:
- Applicants must submit qualification requirements to the bureau.
- The main applicant must be 18 years of age or older.
- Prior criminal convictions of anyone involved with the organization must be disclosed.
The commissioner will also take into account any other important information regarding the organization and several other factors including:
- The honesty and integrity of the applicant.
- The veracity and accuracy of any information supplied to the bureau by the applicant.
- The applicant’s indebtedness to local, state, or federal government.
- A pending lawsuit or bankruptcy proceeding involving the applicant.
- The applicant’s current or past history of compliance with the act, these rules, terms of probation, directives of the bureau, public policy of the state of Michigan, or any other local, state, or federal law or regulation.
Types of charitable gaming licenses in Michigan
In Michigan, there are separate application forms for raffle, special bingo, weekly bingo, special charity game, or annual charity game ticket licenses.
How to apply for a charitable gaming license in Michigan?
Nonprofit organizations hoping to apply for a charitable gaming license in Michigan must provide qualification information documents to the Michigan Lottery bureau. They may either submit the qualification documents along with their application form, or prior to submitting their application form.
Organizations must first select the proper documents according to the type and purpose of their group, choosing from a list of seven options including:
- Local Civic
- Senior Citizens
Each category comes with a separate PDF document with the first page being for the organization’s qualification information and the second page outlining qualification requirements for the specific organization type. For example, for educational organizations, the requirements include:
- A signed and dated copy of the organization’s current bylaws or constitution, including membership criteria.
- A complete copy of the organization’s Articles of Incorporation that have been filed with the Corporations and Securities Bureau, if the organization is incorporated.
- A provision in the bylaws, constitution, or Articles of Incorporation that all assets, and real and personal property will revert to the local government or another nonprofit organization should the organization dissolve.
- A copy of the letter from the IRS stating the organization is exempt from federal tax under IRS code 501(c) OR copies of one bank statement per year for the previous five years, excluding the current year.
- A letter from the Michigan Department of Education stating the organization complies with the revised school code, 1976 PA 451, MCL 380.1 to 380.1852.
Once the proper documentation and any additional materials as directed by the bureau have been submitted, the organization must also pay a fee to apply.
How much does a charitable gaming license cost in Michigan?
In Michigan, charitable gaming licenses may cost anywhere from $0 to $200. View the full list of costs for charitable gaming licenses in Michigan.
What is the validity of a charitable gaming license in Michigan?
According to the act, a charity game license in Michigan issued by a commissioner is valid for a period of one year. Each license expires on July 31 at 12 midnight annually, and organizations must file applications for renewal every year.
How long does it take to obtain a charitable gaming license in Michigan?
The Michigan Lottery suggests allowing for a period of three weeks from the time of submitting the application to viewing its status online. Organizations can check the status of their application on the Michigan Lottery webpage.
Monitoring of charitable gaming events in Michigan
In Michigan, the Charitable Gaming bureau is responsible for the oversight and regulation of bingo, raffles, and charity game tickets. The act states that all records supporting the sale of game tickets to suppliers must be made available to the bureau upon request for inspection or audit, and regular reports may also be required.
Failing to adhere to government guidelines on charitable gaming can result in criminal charges, fines and potentially thousands in legal fees (depending on the situation). It’s always best to consult with a lawyer who’s knowledgeable about charitable gaming and raffle laws in your area.
Charitable gaming resources for Michigan
Charitable Gaming Division
101 E. Hillsdale, PO Box 30023
Lansing, MI 48909
Charitable Gaming Division
101 E. Hillsdale, Lansing, MI 48933
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