CalNonprofits Opposes Proposed Raffle Law

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July 8, 2015; CapitolTrack and CalNonprofits

CalNonprofits, the organization that advocates on behalf of nonprofits in California, has come out in opposition to a bill that would change the regulation of charitable raffles.

“SB 549 lets professional sports teams and their foundations play by different rules than the rest of us,” the group said in an action alert letter to members and stakeholders.

Raffles were illegal in the state of California prior to 2001. The law was changed through a voter-approved initiative, allowing only nonprofits to conduct raffles and only so long as 90 percent of the gross receipts were directed to “beneficial and charitable purposes.” Nonprofits across California have been holding raffles to fundraise since then.

But a bill in the state senate would create special rules for an limited group of non-profit organizations—the nonprofit affiliates of nine major sports leagues (such as the NFL and MLB)—that would be allowed to conduct raffles where only 50 percent of the receipts benefit the charities, with the other half being awarded to winners.

“All other nonprofits—school bands, symphonies, humane societies, rotary clubs and food banks, and all the rest of us—would be limited to the current 90/10 rules…and that’s not fair,” the letter goes on to say.

“Current law ensures that the primary purpose of any charitable raffle is to benefit a nonprofit. Raffles with a 50/50 split move away from that intent and may inadvertently put more focus on gambling to win a cash prize. And the public could rightfully become confused about whether raffles really benefit nonprofits at all.”

CalNonprofits, along with Housing California, the Napa Valley Community Foundation, the Center for Human Services, the Association of California Symphony Orchestras, Meals on Wheels San Francisco and the Santa Barbara Community College Foundation, have opposed the bill, along with the Republican caucus in the Democratic-controlled legislature.—Larry Kaplan