State Senator Jay Hottinger

The author of a recent letter to the editor in one of my district newspapers commented on the negative effect of the new bingo law on his mother’s Eagle club, as well as other organizations in the area such as VFW and Fraternal groups. He blamed the Republicans in office for the detrimental law and its effects on donations to charities. I would like the opportunity to comment on this issue.

The Ohio General Assembly has already addressed charitable gaming and bingo twice. We are addressing it yet again and hope this time to resolve many issues that cropped up after passage of the prior bills. The intent of the original charitable gaming/bingo bill (HB 512) and the subsequent clarifications made in the budget bill (HB 95) is to regulate instant bingo, to assure that “bogus” charities are no longer in the business of charitable gaming, and to make sure that legitimate charities receive the monies raised by gambling.

Our state Constitution allows for bingo to be conducted by charitable organizations for charitable purposes. Under our old laws, slot machines were not defined, bingo operators and charities were not licensed and the games were not monitored. As a result, bogus charities popped up all over the state and ticket distributors and game operators kept all the profits. In 2002 more than 100 people were indicted on various racketeering and gambling charges in Cuyahoga, Lorain and Hamilton counties. Millions of dollars were diverted from the stated recipients or intended charities.

Illegal profit taking occurred in many storefronts that sold pull-tab instant tickets or operated bingo slot machines. The new law was aimed directly at storefront operations by prohibiting businesses from making bingo their sole source of income. The statute also eliminated gaming machines, such as slots, which became popular staples of the stores.

Almost immediately upon passing House Bill 512, we began hearing from various organizations that had questions and concerns with the law. While it did shut down the illegal storefront operations, it seemed to have an unintended consequence. Many groups argued that the new law negatively affected veteran, fraternal and service organizations and even threatened their existence.

First we delayed implementation of the law until July 1, 2003 to allow more time for organizations to understand the law and new procedures. Then under the state budget bill, House Bill 95, we made further changes to allow fraternal and veteran organizations to run instant bingo games, clarify that licensing fees are based on gross profits and made other changes. Under the revision, veterans/fraternal groups only had to donate 5% of profits to their own charitable purchases and 50% of instant bingo proceeds to charitable organizations defined in the law; the rest goes to the group and its expenses.

Charitable gaming and bingo have yet again resurfaced in House Bill 325 which is currently pending in the Senate Agriculture committee. After passage of HB 512 and the revisions in HB 95, legislators heard that the mandatory application forms were difficult to complete, the licensing fees were set too high, other groups were excluded from eligibility and many organizations that were included were not able to comply with the new law. Due to unintended consequences of the previous legislation, many organizations are struggling to exist and finding it hard to pay normal bills and expenses related to maintaining their facilities. Many organizations stated they would be unable to remain a viable part of their local charitable and community service ventures.

House Bill 325 would make many additional changes to the state’s bingo law. HB 325 allows charitable organizations to deduct the operating expenses from either regular bingo or instant bingo proceeds and requires that these expenses be auditable. It provides for more flexible hours of operation by allowing a veterans’ organization, a fraternal organization, or a sporting organization to sell instant bingo twelve hours during any day. It also allows the IRS designated 501(c)7 recreational, patriotic, historical, cultural, and ancestral organizations (defined as social clubs in the bill) to apply for a

bingo license.

Other changes proposed in House Bill 325 include a short-term bingo license; authorizing the purchase, lease, and use of instant bingo ticket dispensers; authorizing games of chance and instant bingo at festivals; allowing more charitable organizations to conduct raffles without having to obtain a bingo license; allowing charitable gambling by county or independent agricultural societies at all county fairgrounds during specified time periods and making other changes in the Charitable Gambling Law, including reducing the general penalty for conducting illegal bingo.

I believe these most of these issues are valid and that the changes in House Bill 325 will satisfy the needs of the organizations that conduct charitable gaming and that dedicate the profits to various charities in the community. I believe there are still issues that need to be addressed and look forward to the continued discussions in the Senate.

It is worth noting that the Charitable Gaming bill has bipartisan support in the Ohio legislature. Both Republicans and Democrats support this issue, as long as the proceeds are still directed towards charities as mandated by our state constitution. I hope this column shows the author of the letter to the editor, and the other constituents of the 31st Senate district, that we support and remain committed to this issue. As always, please feel free to contact me by mail (State Senator Jay Hottinger, Ohio Senate, Statehouse, Columbus, OH 43215), by email (sd31@mailr.sen.state.oh.us) or by phone (614-466-5838).