COMMITTEE SUBSTITUTE

FOR

H. B. 4479

(By Delegates Kiss and Michael)

[Originating in the House Committee on Finance]

(February 19, 1996)




A BILL to amend and reenact sections two, three, six-a, ten, eleven, twelve-a, thirteen, fifteen, and twenty-four, article twenty, chapter forty-seven of the code of West Virginia, one thousand nine hundred thirty-one, as amended, to further amend said article by adding thereto a new section, designated section five-a, and to amend and reenact sections four, eleven, twelve, fifteen, and twenty-two, article twenty-one of said chapter forty-seven, all relating to charitable bingo and raffles; setting forth venue requirements for bingo and raffle occasion; providing a process for application for a bingo license; increasing the amount of prizes which may be awarded at a super bingo occasion and other bingo occasions; restricting eligibility for persons who may hold a bingo license; changing allowable compensation of employees and number of employees setting forth concession exception; changing the authorized use of proceeds; clarifying reporting requirements; changing raffle application requirements; removing cap in amount of
allowable raffle prizes; amending the manner in which compensation is paid to persons holding raffles; authorizing tax commissioner to disapprove contracts made by raffle licensees; and clarifying reporting requirements for raffle licensees.
Be it enacted by the Legislature of West Virginia:
That sections two, three, six-a, ten, eleven, twelve-a, thirteen, fifteen, and twenty-four, article twenty, chapter forty-seven of the code of West Virginia, one thousand nine hundred thirty-one, as amended, be amended and reenacted, that said article be further amended by adding thereto a new section, designated section five-a, and that sections four, eleven, twelve, fifteen and twenty-two, article twenty-one of said chapter by amended and reenacted to read as follows:
ARTICLE 20. CHARITABLE BINGO.
§47-20-2. Definitions.

For purposes of this article, unless specified otherwise:
(a) "Bingo" means the game wherein participants pay consideration for the use of one or more cards bearing several rows of numbers no two of which cards played in any one game contain the same sequence or pattern. When the game commences, numbers are selected by chance, one by one, and announced. The players cover or mark those numbers announced as they appear on the card or cards which they are using. The player who first announces that he has covered a predetermined sequence or pattern which had been preannounced for that game is, upon verification of such, declared the winner of that game.
(b) "Bingo occasion" or "occasion" means a single gathering or session at which a series of one or more successive bingo games is conducted by a single licensee.
(c) "Charitable or public service activity or endeavor" means any bona fide activity or endeavor which directly benefits a number of people by:
(1) Assisting them to establish themselves in life as contributing members of society through education or religion; or
(2) Relieving them from disease, distress, suffering, constraint, or the effects of poverty; or
(3) Increasing their comprehension of and devotion to the principles upon which this nation was founded and to the principles of good citizenship; or
(4) Making them aware of or educating them about issues of public concern so long as the activity or endeavor is not aimed at influencing legislation or supporting or participating in the campaign of any candidate for public office; or
(5) By lessening the burdens borne by government or voluntarily supporting, augmenting or supplementing services which government would normally render to the people; or
(6) Providing or supporting nonprofit community activities for youth, senior citizens or the disabled; or
(7) Providing or supporting nonprofit cultural or artistic activities.
(d) "Charitable or public service organization" means a bona fide, not for profit, tax-exempt, benevolent, educational, philanthropic, humane, patriotic, civic, religious, fraternal, oreleemosynary incorporated or unincorporated association or organization; or a volunteer fire department, rescue unit or other similar volunteer community service organization or association; but does not include any nonprofit association or organization, whether incorporated or not, which is organized primarily for the purposes of influencing legislation or supporting or promoting the campaign of any candidate for public office.
An organization or association is tax-exempt if it is, and has received from the Internal Revenue Service a determination letter that is currently in effect stating that the organization is, exempt from federal income taxation under subsection 501(a) and described in subsection 501(c)(3), 501(c)(4), 501(c)(8), 501(c)(10), 501(c)(19) or 501(d) of the Internal Revenue Code.
(e) "Commissioner" means the state tax commissioner.
(f) "Concession" means any stand, booth, cart, counter or other facility, whether stationary or movable, where beverages, both alcoholic and nonalcoholic, food, snacks, cigarettes or other tobacco products, newspapers, souvenirs or any other items are sold to patrons by an individual operating the facility. Notwithstanding anything contained in subdivision (2), subsection (a), section twelve, article seven, chapter sixty of this code to the contrary, "concession" includes beverages which are regulated by and shall be subject to the provisions of chapter sixty of this code: Provided, That in no case may the sale or the consumption of alcoholic beverages or nonintoxicating beer be permitted in any area where bingo is conducted.
(g) "Conduct" means to direct the actual playing of a bingo game by activities including, but not limited to, handing out bingo cards, collecting fees, drawing the numbers, announcing the numbers, posting the numbers, verifying winners and awarding prizes.
(h) "Expend net proceeds for charitable or public service purposes" means to devote the net proceeds of a bingo occasion or occasions to a qualified recipient organization or as otherwise provided by this article and approved by the commissioner pursuant to section fifteen of this article.
(i) "Gross proceeds" means all moneys collected or received from the conduct of bingo at all bingo occasions held by a licensee during a license period; this term shall not be deemed to include any moneys collected or received from the sale of concessions at bingo occasions.
(j) "Joint bingo occasion" means a single gathering or session at which a series of one or more successive bingo games is conducted by two or more licensees.
(k) "Licensee" means any organization or association granted an annual, limited occasion or state fair bingo license pursuant to the provisions of this article.
(l) "Net proceeds" means all moneys collected or received from all the conduct of bingo at bingo occasions held by a licensee during a license period after payment of expenses authorized by sections ten, thirteen, fifteen and twenty-two of this article; this term shall not be deemed to include moneys collected or received from the sale of concessions at bingooccasions.
(m) "Person" means any individual, association, society, incorporated or unincorporated organization, firm, partnership or other nongovernmental entity or institution.
(n) "Patron" means any individual who attends a bingo occasion other than an individual who is participating in the conduct of the occasion or in the operation of any concession, whether or not the individual is charged an entrance fee or plays any bingo games.
(o) "Qualified recipient organization" means any bona fide, not for profit, tax-exempt, as defined in subdivision (d) of this section, incorporated or unincorporated association or organization which is organized and functions exclusively to directly benefit a number of people as provided in subparagraphs (1) through (7), subdivision (c) of this section."Qualified recipient organization" includes without limitation any licensee which is organized and functions exclusively as provided in this subdivision.
(p) "Venue" means the location in which bingo occasions are held.
§47-20-3. Who may hold bingo games; application for license; licenses not transferable.

Any charitable or public service organization which has been in existence in this state two years prior to filing an application for a bingo license issued pursuant to section four or five of this article may hold bingo occasions in accordance with the provisions of this article during such time as it holds a validlicense.
Application for a bingo 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 seven 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 bingo occasion: Provided, That for the first six months after the effective date of this article, an application for an annual or limited occasion license shall be filed not less than ninety days before such date, and an application for a state fair bingo license shall be filed not less than thirty days before such date. 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 the said thirty days, send to the applicant its license: Provided, That for the first six months after the effective date of this article, an application which is not denied within sixty days after filing is considered approved and the commissioner shall, within ten days after expiration of the said sixty days, send to the applicant its license.
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 said effective date and any application for a state fair bingo license is considered filed on the date of its receipt by the tax commissioner.
No bingo occasion may be held until an application filed in accordance with this article has been approved by the tax commissioner, and the bingo license has been received: Provided, That under no circumstances may a licensee organization conduct a bingo occasion before the sixty day filing period between the filing of the application and date of the first bingo occasion has elapsed: Provided, however, That the date the application is received by the tax commissioner shall begin the sixty day filing period. The tax commissioner shall send the applicant its license within five days after approval of the bingo application. If the filing period has elapsed, and the application has not been denied by the tax commissioner, and the license has not been received by the applicant, the applicant may consider the application approved and begin to hold bingo occasions. The tax commissioner shall send a bingo license to the applicant within five days after the expiration of the filing period if the application has not been otherwise denied.
No bingo license issued pursuant to this article may be transferred.
§47-20-5a. Venue.
Any charitable or public service organization or any of its auxiliaries or other organizations otherwise affiliated with it possessing an annual or limited occasion bingo license or a super bingo license shall conduct a bingo occasion only in the county within which the organization is principally located.
Any licensee which, in good faith, finds itself unable to comply with this requirement shall apply to the tax commissionerfor permission to conduct a bingo occasion in a location other than the county within which the organization is principally located: Provided, That such location shall be in a contiguous county, or, if not in a contiguous county, and not in the county where the licensee organization has its principal location, the location of the proposed bingo occasion may be no more than thirty air miles from the county within which the organization is principally located. The application shall be made on a form provided by the tax commissioner and shall include the particulars of the requested change and the reasons for such change. The application shall be filed no later than sixty days before any scheduled bingo occasion.
For purposes of this section, the principal location of a licensee shall be the address of the licensee shown on the licensee's West Virginia business registration certificate.
§47-20-6a. Super bingo license.
Any charitable or public service organization may, upon payment of a five thousand dollar license fee, apply to the tax commissioner for issuance of an annual super bingo license. All revenue from said license fee shall be deposited in the special revenue account established under the authority of section two-a, article nine, chapter eleven of this code and used to support the investigatory activities provided for in said section. The tax commissioner shall promulgate rules in accordance with article three, chapter twenty-nine-a of this code specifying those organizations which qualify as charitable or public service organizations.
A holder of a super bingo license may conduct one super bingo occasion each month during the period of the license at which up to thirty fifty thousand dollars in prizes may be awarded, notwithstanding the seven ten thousand five hundred dollar limitation on prizes specified in section ten of this article.
A charitable or public service organization that has a regular or limited occasion bingo license may apply for a super bingo license.
§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 ten 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 and who have been active members in good standing ofthe licensee organization or its authorized auxiliary for at least two years prior to the date of filing of the application for a charitable bingo license or the most recent filing of an application for renewal of such license 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 except for junior firefighters, in accordance with the provisions of this article.
§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 the minimum of which shall be established at the federal minimum wage, and the maximum being six dollars and fifty cents per hour, to operators of bingo games who are active members of the licensee organization and who have been active members in good standing for at least two years prior to the date of filing of the application for a charitable bingo license or the most recent filing of an application for renewal of such license.
(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 paidto not more than five eight 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 five 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 not more than two three operators.
(e) If the licensee also possesses a super bingo license, it may pay a salary to not more than fifteen operators during such super bingo occasion.
(f) In the case of a licensee lawfully holding a charitable bingo occasion simultaneously with a charitable raffle occasion, the number of paid charitable bingo operator employees allowed under this limitation for bingo licensees shall be in addition to the number of charitable raffle operator employees allowed under section fifteen, article twenty-one of this chapter. Licensees holding such simultaneous occasions shall pay bingo operators from the proceeds of bingo operations and shall pay raffle operators from the proceeds of raffle operations, and the charitable bingo fund and the charitable raffle fund and payments therefrom shall not be commingled.
(g) For purposes of the limitations set forth in this section, the term "operator" or "bingo operator" or "raffle operator" shall not include concession stand workers. Wages paidto concession workers shall not exceed six dollars and fifty cents per hour.
 §47-20-13. Concessions exception.
A licensee may allow any individual, firm, partnership or corporation to operate concessions in conjunction with bingo occasions, and to be compensated for such operation, in accordance with the following provisions: only if the individual, firm, partnership or corporation agrees to donate all net proceeds received from the sale of the concessions and all compensation received from the licensee organization to charitable or public service purposes as specified under section two, subsection (c) of this article.
(a) The licensee organization is one which meets or holds functions other than bingo occasions on a regular basis; and
(b) The concession to be operated at the bingo occasion is operated regularly at such meetings or functions; and
(c) The individual, firm or corporation which operates the concession at such regular meetings or functions is the same which operates the concession at the bingo occasion; and
(d) The terms of the agreement under which the individual, firm, partnership or corporation operates the concession at the bingo occasion are the same terms under which the concession is operated at the regular meetings or functions: Provided, That a copy of such agreement is filed at the time the application is made and any changes thereto are filed within ten days of being made.
In addition, any charitable or public service organizationas defined by section two of this article may operate a concession at any bingo occasions held by a licensee provided that the net proceeds it receives from that concession are used solely for the charitable or public service purposes of that organization.
§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 rafflepatrons: 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) The tax commissioner shall have the authority to disapprove any contract for sale of goods or services to anycharitable bingo licensee for use in or with relation to any charitable bingo operation or occasion, or any lease of real or tangible personal property to any charitable bingo licensee for use in or with relation to any charitable bingo operation or occasion, if such contract or lease is unreasonable or not representative of fair market value. Contracts or leases so disapproved shall be deemed to be in contravention of this article, and shall be void. Any attempt by any charitable bingo licensee to engage in transactions under the terms of any lease or contract so disapproved shall be grounds for revocation or suspension of the charitable bingo license and for refusal by the tax commissioner to renew the charitable bingo license.
(f) If a property owner or lessee, including his agent, has entered into a rental contract to hold super bingo occasions on his premises, such premises shall be rented, for super bingo occasions, to not more than four super bingo licensees during any period of four consecutive calendar weeks: Provided, That each of the charitable or public service organizations desiring to hold a super bingo occasion must possess its own super bingo license. Subject to this limitation, such premises may be used for super bingo occasions during two consecutive days during a conventional weekend (Saturday and Sunday): Provided, That such super bingo occasions may occur at the same facility no more often than alternating weekends during a calendar month.
(e) (g) 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 netproceeds 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.
§47-20-24. 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 financialreport 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 either a compilation and or 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 two year years prior to filing an application for a raffle license issued pursuant to section five or six of this article may hold raffle occasions inaccordance 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. No raffle may be held and no tickets may be sold pursuant to this article until the raffle application; has been approved by the tax commissioner and the license has been received by the applicant: Provided, That no raffle occasion may be held and no raffle tickets may be sold until a sixty day filing period, which is that time period between the receipt of that application by the tax commissioner and the first raffle occasion, has expired: Provided, however, That the tax commissioner shall send the applicant its license within five days after the application is approved. If the sixty day filing period has expired and the application has not been denied and the raffle license has not been received by the applicant, the applicant may consider the application approved and begin to sell tickets for the raffle or hold the raffle occasion. The tax commissioner shall send the applicant its license within fivedays after the expiration of the filing period if the application has not been otherwise denied.
(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.
§47-21-12. Compensation. generally prohibited
Except as otherwise provided in section thirteen of this article, no individual who participates in any manner in the conduct of a raffle occasion or the operation of a concession in conjunction with a raffle occasion may receive or accept either directly or indirectly any commission, wage, salary, reward, tip, donation, gratuity or other form of compensation or remuneration,regardless of the source, for his work, labor or services.
(a) A licensee may pay a salary, the minimum of which shall be established at the federal minimum wage, and the maximum being six dollars and fifty cents per hour, to operators of charitable raffle games who are active members of the licensee organization and who have been active members in good standing for at least two years prior to the date of filing of the application for a charitable raffle license or the most recent filing of an application for renewal of such license.
(b) If the licensee's gross receipts from raffle 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 eight operators.
(c) If the licensee's gross receipts from charitable raffle 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 five operators.
(d) If the licensee's gross receipts from charitable raffle 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 three operators.
(e) In the case of a licensee lawfully holding a charitable bingo occasion simultaneously with a charitable raffle occasion, the number of paid charitable raffle operator employees allowed under this limitation for charitable raffle licensees shall be in addition to the number of charitable bingo operator employeesallowed under section twelve-a, article twenty of this chapter. Licensees holding such simultaneous occasions shall pay bingo operators from the proceeds of bingo operations and shall pay raffle operators from the proceeds of raffle operations, and the charitable bingo fund and the charitable raffle fund and payments therefrom shall not be commingled.
(f) For purposes of the limitations set forth in this section, the term "operator" or "bingo operator" or "raffle operator" shall not include concession stand workers. Wages paid to concession workers shall not exceed six dollars and fifty cents per hour.
§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 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 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 bedevoted or in any manner used by any licensee or qualified recipient organization for the construction, acquisition, or 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) The tax commissioner shall have the authority to disapprove any contract for sale of goods or services to any charitable raffle licensee for use in or with relation to any charitable raffle operation or occasion, or any lease of real or tangible personal property to any charitable raffle licensee for use in or with relation to any charitable raffle operation or occasion, if such contract or lease is unreasonable or not representative of fair market value. Contracts or leases sos disapproved shall be deemed to be in contravention of this article, and shall be void. Any attempt by any charitable raffle licensee to engage in transactions under the terms of any lease or contract so disapproved shall be grounds for revocation or suspension of the charitable raffle license and for refusal by the tax commissioner to renew the charitable raffle license.
(e) (f) 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. Theapplication 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, onethousand nine hundred ninety-three, must contain either a compilation and or 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.


Strike-throughs indicate language that would be stricken from the present law, and underscoring indicates new language that would be added.

§47-20-5a is new; therefore, strike-throughs and underscoring have been omitted.