BILL ANALYSIS
Bill No: SB
1090
SENATE COMMITTEE ON GOVERNMENTAL ORGANIZATION
Senator Roderick D. Wright, Chair
2009-2010 Regular Session
Staff Analysis
SB 1090 Author: Cedillo
As Introduced: February 17, 2010
Hearing Date: March 23, 2010
Consultant: Chris Lindstrom
SUBJECT
Bingo: remote caller bingo.
DESCRIPTION
SB 1090 modifies the permissive model ordinance language
contained in the Remote Caller Bingo Act of 2008 to allow
an organization to file, along with its application to the
local licensing official to operate a bingo game,
"appropriate documentation" rather than "a certificate
issued by the Franchise Tax Board" to demonstrate that the
applicant is an eligible tax exempt organization authorized
to operate a remote caller bingo game.
EXISTING LAW
Existing law provides that the Legislature, by statute, may
authorize cities and counties to allow for the play of
bingo games, but only for charitable purposes [California
Constitution, Article IV, Section 19 (c)].
Existing law permits cities, counties, and cities and
counties to allow remote caller bingo games to be conducted
by specified tax exempt and nonprofit organizations for
charitable purposes, subject to provisions of law which, if
violated, constitute a crime.
Existing law authorizes specified tax-exempt and nonprofit
organizations that have been incorporated or in existence
SB 1090 (Cedillo) continued
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for three years or more and that are not organized for the
primary purpose of operating bingo to conduct remote caller
bingo games no more than one day per week.
Existing law defines a "remote caller bingo game" as a game
of bingo in which numbers or symbols on randomly drawn
plastic balls are announced by a person present at the site
at which the live game is conducted, and audio and video
technology links in-state facilities for the purpose of
transmitting the remote calling of a live bingo game from a
single location to multiple locations.
Existing law requires remote caller bingo games to be
played using traditional paper or other tangible bingo
cards and daubers, and shall not be played by using
electronic devises, except card-minding devices.
Existing law requires an authorized organization to provide
the California Gambling Control Commission (CGCC) with at
least 30 days advanced written notice of its intent to
conduct remote caller bingo games, and submit specified
information about the organizations, locations, vendors,
and licensees involved in the operation of the games, as
well as, a copy of the local ordinance for the counties in
which the games will be played.
Existing law contains "permissive model ordinance" language
which local jurisdictions may adopt to authorize remote
caller bingo.
BACKGROUND
Purpose of the bill . According to the author's office, "In
2008, the Legislature passed, and the Governor signed into
law, SB 1369 which allows qualified non-profits to operate
"remote caller" bingo games.
"Once SB 1369 was chaptered, technical errors and omissions
were identified by the implementing state entity, the
California Gambling Control Commission. Charities have
also raised issues as they organize themselves to apply and
conduct the game.
"The purpose of SB 1090 is to clean-up language and
fine-tune implementation issues that have arisen as
charities and local governments take steps toward
SB 1090 (Cedillo) continued
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authorizing and conducting the games."
Background . In 2008, SB 1369 (Chapter 748, Statutes of
2008) was enacted. Primarily, SB 1369 banned the use of
electronic bingo (ebingo) machines, authorized the play of
remote caller bingo in jurisdictions that have a remote
caller bingo ordinance, and created a mitigation fund to
minimize the impacts to the charities that previously
operated ebingo machines. Arguably, remote caller bingo
was authorized to create an alternative or substitute
revenue source to compensate charities for the loss of
revenues that they previously realized from the operation
of ebingo machines. Additionally, other charities which
did not operate ebingo machines viewed remote caller bingo
as a new opportunity to raise much needed funds to support
their charitable work and were eager to begin the operation
of remote caller bingo.
Last year, charities indicated that their ability to
operate remote caller bingo games was retarded as a result
of local governments not adopting remote caller bingo
ordinances. The charities solution was to place a
permissive model ordinance in law that the locals could use
as a template to adopt their own remote caller bingo
ordinances. In response, amendments were taken in the
Assembly to SB 126 (Chapter 562, Statutes of 2009) which
added a permissive model ordinance to the Remote Caller
Bingo Act.
This year, the charities raise concern with respect to the
permissive model ordinance in law. Specifically, the
charities argue that it is difficult and time consuming to
receive a certificate issued by the Franchise Tax Board
(FTB) to demonstrate that they are a tax exempt
organization. The charities recommended solution, which is
contained in SB 1090, is to modify the language in the
permissive model ordinance to require a charity to provide
"appropriate documentation" certifying that it is a tax
exempt organization rather than "a certificate issued by
FTB" as certification of its tax exempt status.
A document that may be useful and is easily accessible to
verify the tax-exempt status of an organization is found on
FTB's Website through this hotlink,
http://www.ftb.ca.gov/businesses/Exempt_organizations/Entity
_list.shtml . Through this hotlink, FTB provides a
SB 1090 (Cedillo) continued
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published list of all tax-exempt organizations that have
tax-exempt or revoked status. The list is updated monthly.
Staff comments . The permissive model ordinance in the
Remote Caller Bingo Act is a template for local governments
to use. It is not a requirement. State law only requires
the tax exempt organization to be incorporated or in
existence for three or more years and that the organization
shall not be organized for the sole purpose of operating
remote caller bingo. Changing the permissive local
ordinance language, as written, has no effect on state law,
however, it may require any local jurisdictions that have
adopted a local ordinance using the template in the Penal
Code to have to amend their ordinance. As such, the author
may wish to consider the following change:
On page 4, line 9, before the word "Appropriate", insert "A
certificate issued by the Franchise Tax Board or" such that
the sentence will read:
(1) A certificate issued by the Franchise Tax Board or
appropriate Appropriate documentation certifying that
the applicant is exempt from the payment of the Bank
and Corporation Tax pursuant to Section 23701d of the
Revenue and Taxation Code.
PRIOR/RELATED LEGISLATION
SB 1484 (Governmental Organization), 2009-2010 Legislative
Session . Corrects an inadvertent drafting error made to
the permissive model code contained in the California
Remote Caller Bingo Act relative to the number of days in a
week that an eligible nonprofit organization may conduct a
remote caller bingo game. The change will bring the model
code in line with statute, which provides that eligible
organizations may not operate remote caller bingo more than
one day a week. (Pending in Senate Governmental
Organization Committee)
SB 126 (Cedillo), Chapter 562, Statutes of 2009 . Deletes
reference to school districts in the provisions specifying
the organizations that may conduct remote caller bingo
games and instead authorizes "charitable organizations
affiliated with a school district" to conduct remote caller
bingo games. Contains permissive model ordinance language
SB 1090 (Cedillo) continued
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for local governing bodies to use. Deletes requirement
that the California Gambling Control Commission establish
criteria for registering manufacturers and distributors.
Makes other technical and conforming changes.
AB 1036 (Niello), 2009-2010 Legislative Session . Would
allow a maximum of 100 unaffiliated organizations to enter
into an agreement to cosponsor a remote caller bingo game
if the game does not have more than 100 locations. (Died
in Assembly Governmental Organization Committee pursuant to
Joint Rule 56)
SB 1369 (Cedillo), Chapter 748, Statutes of 2008 .
Authorizes nonprofit organizations, mobile-home park
associations, senior citizens organizations, and
organizations affiliated with school districts that have
been incorporated or in existence for three years or more
to conduct "remote caller bingo".
SB 1328 (Cedillo), 2007-2008 Legislative Session . Would
have permitted local jurisdictions to adopt an ordinance to
allow specified not for profit organizations to play remote
caller bingo, as defined. (Held in Senate Governmental
Organization Committee)
Support : As of March 19, 2010:
California Association of Nonprofits
Oppose None on file as of March 19, 2010
FISCAL COMMITTEE: No.
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