Guide to California Bingo Laws
The scope of California’s Bingo Laws is a bit complicated by the fact that a number of local jurisdictions have their own bingo ordinances, which follow the statutory provisions. Therefore, legislation governing bingo activities in California can be found both at the state level and at the local level in some jurisdictions. California’s Bingo Laws date back more than six decades. The first major piece of Bingo legislation was passed in 1953, and was amended and added to over the years. The Bingo Law was repealed and replaced with an updated version in 1985, and then again in 1986. Assembly Bill 1307 further revised the Bingo Law in 1994 and has not been significantly changed since that time.
The sweeping changes to the Bingo law in the mid-1980s brought with them a number of limitations on game operations, including the prohibition against the use of electronic equipment during regular games and the imposition of payment limitations. As enacted in 1985, covered organizations that were authorized to conduct bingo games were permitted to conduct bingo games in any district in the state and were authorized to conduct a limited number of special events each year. The Bingo Law also authorized certain bingo organizations to conduct bingo games for a period not to exceed five days during any one calendar year, to assist in financing an annual civic or cultural event. In addition , suppliers of equipment and supplies were also regulated.
The Bingo Law has been amended by the State Legislature since its initial passage in 1985 to permit certain operators to conduct a special fundraiser once a quarter, annually or once every two years.
California Bingo Laws currently include:
- California Penal Code Section 326.5 which contains general provisions for the operation of bingo. Equipment manufacturers and suppliers and the organizations that promote their services must also be licensed in accordance with the Penal Code.
- California Penal Code Section 326.5(d)(8) which contains the requirements that apply to the issuance of license for the conduct of bingo games.
- California Penal Code Section 326.5(c)(8) which governs the issuance of licenses to individuals to conduct bingo games.
- California Penal Code Section 326.5(a)(6) which provides information about the regulatory powers of the A.G.
In addition, local jurisdictions (cities and counties) are authorized to issue permits for bingo games if the local jurisdiction finds, among other things, that all profits from the game(s) will be used for charitable purposes and which includes use by charitable organizations for religious, charitable, or benevolent purposes.
A local ordinance must not, however, include any provisions for compensation or profit-sharing in connection with the bingo game or the administration thereof or require licensing by the California Department of Justice.
What is “Bingo” Under California Law
When it comes to California bingo law, the meanings of all relevant terms are supplied by state legislation. "Bingo" itself is defined in California Penal Code Section 326.5 as "a game of chance played with cards or with a set of 90 numbered cards or 75 numbered squares in which each player covers on his or her card all the numbers drawn by a randomizer until either a specified arrangement has been covered or all numbers have been covered." The term does not include "beano, lotto, or other games played in a similar manner," according to the law.
Though this definition information is presented in an article chiefly about commercial bingo, the key takeaway is to be aware that no two bingo laws are the same. More specifically, the legal definition of bingo in a given jurisdiction matters immensely when determining how any particular game should actually be played.
For instance, some of these definitions sanction what’s called "beano." Under California Penal Code Section 326.5, playing bingo with anything other than a random number generator is illegal, unless "an arrangement is required to be covered and the rules of play so provide." An example would be a winner being required to cover all the numbers from one specific row.
How this plays out in California, for instance, is that the state’s random number generator laws are exceedingly strict. Any flash game played in a California bingo parlor must have randomized visibility. As the argument goes, if the random number generator isn’t truly random, then the game is no longer a game of pure chance. Instead, if the game is not played in a random manner, it might be considered gambling.
Further, because the definition of bingo generally accounts for games of chance with a subset of 75 or 90 cards used, and under current California law, commercial bingo uses those exact specifications, games of chance using the same basic structure but which do not involve any type of random number generator, are not considered bingo.
As a general rule of thumb, if your bingo game doesn’t comply with the legal definition, then it’s not a game of bingo, but rather something else—such as gambling.
Charitable Bingo vs. Commercial Bingo
California law distinguishes between charitable and commercial bingo. Since organizations that are permitted to operate bingo games usually do so to raise funds for charitable purposes, these organizations are considered "bona fide charities." The rules applicable to charitable organizations can be found at California Penal Code sections 320.5 and 320.6. However, certain organizations are exempt from the above restrictions pursuant to Penal Code section 326.5. These include continuing care retirement communities, mobilehome parks, senior citizen centers, and veteran’s organization facilities.
Also, unlike charitable organizations, commercial organizations must obtain an additional license from the Department of Justice in order to participate in California bingo. Over the last 70 years, intergovernmental relations between state and local governments have changed dramatically. Today, state authority over bingo is supreme and questions of local control can be expected to be litigated in the future.
California Bingo Licenses and Permits
The process of obtaining the necessary licenses and permits for organizing a bingo game in California begins well before a prospective provider can distribute bingo cards, purchase equipment, or advertise the upcoming event. As per California Penal Code Section 326.5, a public bingo game cannot be conducted without first securing a "license to conduct a public bingo game" from the city in which the game will be played or from the county for games that are held in an unincorporated area. The licensing process is an in-depth one and requires applicants to submit an array of paperwork and relevant documentation along with their request for a game permit to relevant city/county agencies. Submissions typically include, but are not limited to, the following:
• Completed application for a license to conduct a public bingo game
• Public Records Act disclosure form
• Roster of members of the sponsoring organization
• Copy of the organization’s bylaws
• Call list of all members
• Organizational member roster listing names, addresses, telephone numbers, job skills/occupations, and dates of birth
• By-Legal Committee report
• Proof of Workers’ Compensation Insurance
• Rules and regulations governing the game
• A trust account established for "net proceeds" from the public bingo game
• Payment of applicable fees as outlined in Section 20-7.204 of the Los Angeles County Code
It is important to note that depending on where a game is held, additional paperwork requirements may be necessary as well. After a bingo game permit has been obtained, county ordinances generally dictate that sponsoring providers must adhere to strict compliance guidelines designed to ensure the fair and equitable operation of each non-profit gaming event. Strict record-keeping requirements are a fundamental aspect of each compliance guideline. San Diego County, for instance, asks that providers maintain certain records to include, but not be limited to, the following:
• A declaration of trust created to hold all funds collected during the course of the game
• Daily financial settlement reports
• Copies of all bank statements
• Copies of any checks drawn against the trust
• Copies of any deposits made to the trust
• Receipts from the purchase of bingo supplies
• Documentation of any related expenses
Failing to comply with any of the regulations set forth by city or county ordinances can result in the suspension or revocation of a provider’s game permit or any other appropriate actions as deemed necessary by the relevant authority.
Age and Prize Requirements for California Bingo
A participant in a California bingo game must be at least 18 years of age. In addition, a person under 18 years of age may not be used as a substitute for a bingo game worker. The California Penal Code also provides that no worker of a permitted bingo game can operate an electronic card-minder or a bingo card with an electronic device. Workers may not play at the game they are working at. No more than five bingo games may be played in a 24-hour period of time.
In California, the total value of prizes in a single game of bingo may not exceed $500. If the prize in a single game exceeds $50, then the amount over $50 must be paid in non-cash items only , such as merchandise, food, or beverages. A winner may not claim more than $50 in cash or cash equivalent at one time during a session. Advance purchase of bingo cards is not allowed, and there are limits on the number of cards that may be purchased at one time in any single game or series of games. Raffles are not permitted during bingo games.
When a bingo game is held for other than a religious, charitable, war veterans, or civic purpose, the total value of all prizes for each game may not exceed $7. The aggregate value of prizes for all games held during any single occasion may not exceed $125.
California Bingo Enforcement and Penalties
California has a variety of ways for enforcing its bingo laws, including penalties through the Department of Justice, California Department of Tax and Fee Administration, and the Office of the Attorney General. For every case that regulators open, regulators must be mindful of one important constraint: the law. The law is not a catch all for punishing egregious behavior. It requires a punishment that fits a crime. An enforcement action just cannot be about punishing the wrongdoer, but must also be designed to deter future wrongdoing. Deterrence comes in many forms, from criminal and civil actions to administrative penalties and fines. Deterrence also comes from regulating who organizations can use as contractors.
Broadly speaking, whether or not a violation is serious enough to warrant impounding the property or service will depend on the severity of the violation. Bingo law violations can be serious enough to warrant impounding a site such as this:
- (1) The organization has failed to renew its permit for five years or more from the date of its last bingo permit issuance.
- (2) The organization has engaged in financial improprieties such as holding a bingo session or selling a ticket without a valid bingo supply sales invoice or through a supplier of bingo supplies not on the list of approved suppliers.
- (3) One of the bingo employees or contractors (e.g., a game manager or caller and supplier) has been convicted of a felony involving moral turpitude or theft.
Other violations will not warrant impounding a site, because the remediation is so certain as to warrant only an administrative penalty. For example, bingo advance deposits are required, but the absence of these deposits does not necessarily prevent an organization from conducting their games.
For most organizations, only egregious violations will result in civil or criminal actions. Stuffing the ballot box is highly discouraged because the state has promised the good citizens of California that it will strictly regulate bingo. In this way, the bad conduct of a few will not threaten the viability of a system designed to protect people from the avarice of others.
Recent California Bingo Law Updates
Recent amendments have been made to California’s Bingo regulations: 5 CCR Sections 925 through 935. These amended regulations, which were presumedly adopted in furtherance of the June 2012 passage of California’s Assembly Bill No. 267. AB 267 permits charitable organizations to collectively purchase a single bingo game housing unit as well as ancillary equipment, thereby liberalizing California’s prior regulation which only permitted singular organizational ownership of a bingo game housing unit and associated equipment. The amended Bingo regulations appear to have codified these collaborative ownership provisions; though unfortunately, the amendments fail to elucidate upon the details of such franchising.
Likewise, AB 267 mandates the issuance of a special activity license (bingo license) to a nonprofit public benefit corporation, which is formed under Corporations Code section 5110 et seq. or 5133 et seq. To wit, such corporately formed nonprofit’s bingo license will allow a single organization to conduct bingo as both a representative and, in the absence of its affiliates, as a nonprofit public benefit corporation. The Bingo regulations, however, fail to elucidate upon the details of an organization’s ability to engage in bingo as a nonprofit public benefit corporation with its affiliates present.
Other proposed updates to California’s Bingo regulations, including yet another expanding of the time period during which a bingo licensee must report and remit all net proceeds, have remained pending. Currently, Bingo regulations require a licensee to report and remit all net proceeds to the county or city each month on a prescribed form. An extension allowing bingo licensees to additionally report and remit on a quarterly basis has been proposed but has not yet been enacted. Pending the enactment of such an extension, licensees remain duly obligated to assert compliance with the existing law and remitting all net proceeds for the previous month to the county or city by the fifteenth day of every month.
California Bingo Law FAQ
Here are a few questions and answers we’ve received:
Q. If I run bingo games at my church, I don’t have to pay taxes on the money raised, right?
A. Possibly. Federal and California law exempts certain religious organizations from paying income tax. However, bingo games are subject to tax in California, and proceeds must be reported as gross taxable income.
Q. Aren’t all bingo games illegal anyway?
A. No. Bingo is legal, and has been since the 1950s. But the rules are very strict.
Q. We had an amateur bingo group at our local park last night. The Department of Justice isn’t going to arrest those nice girls, right?
A. It is unlikely that they’ll be arrested, but you never know . Income derived from unlawful gaming activities is taxable. Suspect groups generally are cautioned and provided with legal information. However, recivedigroups can be penalized by the Department of Justice, which can revoke a group’s permit to play bingo.
Q. The winner of last week’s bingo game at my church was paid $1,000. . I thought bingo winners could only receive prizes up to $100?
A. They can. They can, but there are special, more permissive rules for "qualified" organizations including certain senior citizen clubs, veterans’ groups, and charitable organizations that aren’t veterans’ groups or labor unions.