CHAPTER 2002. CHARITABLE RAFFLES
OCCUPATIONS CODE
TITLE 13. SPORTS, AMUSEMENTS, AND ENTERTAINMENT
SUBTITLE A. GAMING
CHAPTER 2002. CHARITABLE RAFFLES
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 2002.001. SHORT TITLE. This chapter may be cited as the
Charitable Raffle Enabling Act.
Acts 1999, 76th Leg., ch. 388, Sec. 1, eff. Sept. 1, 1999.
Sec. 2002.002. DEFINITIONS. In this chapter:
(1) "Charitable purposes" means:
(A) benefitting needy or deserving persons in this state,
indefinite in number, by:
(i) enhancing their opportunities for religious or educational
advancement;
(ii) relieving them from disease, suffering, or distress;
(iii) contributing to their physical well-being;
(iv) assisting them in establishing themselves in life as worthy
and useful citizens; or
(v) increasing their comprehension of and devotion to the
principles on which this nation was founded and enhancing their
loyalty to their government;
(B) initiating, performing, or fostering worthy public works in
this state; or
(C) enabling or furthering the erection or maintenance of public
structures in this state.
(1-a) "Money" means coins, paper currency, or a negotiable
instrument that represents and is readily convertible to coins or
paper currency.
(2) "Qualified organization" means a qualified religious
society, qualified volunteer fire department, qualified volunteer
emergency medical service, or qualified nonprofit organization.
(3) "Qualified religious society" means a church, synagogue, or
other organization or association organized primarily for
religious purposes that:
(A) has been in existence in this state for at least 10 years;
and
(B) does not distribute any of its income to its members,
officers, or governing body, other than as reasonable
compensation for services or for reimbursement of expenses.
(4) "Qualified volunteer emergency medical service" means an
association that:
(A) is organized primarily to provide and actively provides
emergency medical, rescue, or ambulance services;
(B) does not pay its members compensation other than nominal
compensation; and
(C) does not distribute any of its income to its members,
officers, or governing body other than for reimbursement of
expenses.
(5) "Qualified volunteer fire department" means an association
that:
(A) operates fire-fighting equipment;
(B) is organized primarily to provide and actively provides
fire-fighting services;
(C) does not pay its members compensation other than nominal
compensation; and
(D) does not distribute any of its income to its members,
officers, or governing body, other than for reimbursement of
expenses.
(6) "Raffle" means the award of one or more prizes by chance at
a single occasion among a single pool or group of persons who
have paid or promised a thing of value for a ticket that
represents a chance to win a prize.
(7) "Reverse raffle" means a raffle in which the last ticket or
tickets drawn are considered the winning tickets.
Acts 1999, 76th Leg., ch. 388, Sec. 1, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch.
929, Sec. 1, eff. June 18, 2005.
Acts 2005, 79th Leg., Ch.
1006, Sec. 1, eff. September 1, 2005.
Sec. 2002.003. QUALIFIED NONPROFIT ORGANIZATION. (a) An
organization incorporated or holding a certificate of authority
under the Texas Non-Profit Corporation Act (Article 1396-1.01 et
seq., Vernon's Texas Civil Statutes) is a qualified nonprofit
organization for the purposes of this chapter if the
organization:
(1) does not distribute any of its income to its members,
officers, or governing body, other than as reasonable
compensation for services;
(2) has existed for the three preceding years;
(3) does not devote a substantial part of its activities to
attempting to influence legislation and does not participate or
intervene in any political campaign on behalf of any candidate
for public office in any manner, including by publishing or
distributing statements or making campaign contributions;
(4) qualifies for and has obtained an exemption from federal
income tax from the Internal Revenue Service under Section
501(c), Internal Revenue Code of 1986; and
(5) does not have or recognize any local chapter, affiliate,
unit, or subsidiary organization in this state.
(b) An organization that is formally recognized as and that
operates as a local chapter, affiliate, unit, or subsidiary
organization of a parent organization incorporated or holding a
certificate of authority under the Texas Non-Profit Corporation
Act (Article 1396-1.01 et seq., Vernon's Texas Civil Statutes) is
a qualified nonprofit organization if:
(1) neither the local organization nor the parent organization
distributes any of its income to its members, officers, or
governing body, other than as reasonable compensation for
services;
(2) the local organization has existed for the three preceding
years and during those years has been formally recognized as a
local chapter, affiliate, unit, or subsidiary organization of the
parent organization;
(3) neither the local organization nor the parent organization:
(A) devotes a substantial part of its activities to attempting
to influence legislation; or
(B) participates or intervenes in any political campaign on
behalf of any candidate for public office in any manner,
including by publishing or distributing statements or making
campaign contributions; and
(4) either the local organization or the parent organization
qualifies for and has obtained an exemption from federal income
tax from the Internal Revenue Service under Section 501(c),
Internal Revenue Code of 1986.
(b-1) An organization that is formally recognized as and that
operates as a local chapter, affiliate, unit, or subordinate
lodge of a grand lodge or other institution or order incorporated
under Title 32, Revised Statutes, as authorized by Article 1399,
Revised Statutes, is a qualified nonprofit organization if:
(1) neither the local organization nor the incorporated grand
lodge or other institution or order distributes any of its income
to its members, officers, or governing body, other than as
reasonable compensation for services;
(2) the local organization has existed for the three preceding
years and during those years:
(A) has had a governing body or officers elected by a vote of
its members or by a vote of delegates elected by its members; or
(B) has been formally recognized as a local chapter, affiliate,
unit, or subordinate lodge of the grand lodge or other
institution or order;
(3) neither the local organization nor the incorporated grand
lodge or other institution or order:
(A) devotes a substantial part of its activities to attempting
to influence legislation; or
(B) participates or intervenes in any political campaign on
behalf of any candidate for public office in any manner,
including by publishing or distributing statements or making
campaign contributions; and
(4) either the local organization or the incorporated grand
lodge or other institution or order qualifies for and has
obtained an exemption from federal income tax from the Internal
Revenue Service under Section 501(c), Internal Revenue Code of
1986, or other applicable provision.
(c) An unincorporated organization, association, or society is a
qualified nonprofit organization if it:
(1) does not distribute any of its income to its members,
officers, or governing body, other than as reasonable
compensation for services;
(2) for the three preceding years has been affiliated with a
state or national organization organized to perform the same
purposes as the unincorporated organization, association, or
society;
(3) does not devote a substantial part of its activities to
attempting to influence legislation and does not participate or
intervene in any political campaign on behalf of any candidate
for public office in any manner, including by publishing or
distributing statements or making campaign contributions; and
(4) qualifies for and has obtained an exemption from federal
income tax from the Internal Revenue Service under Section
501(c), Internal Revenue Code of 1986.
(d) An organization, association, or society is considered to
devote a substantial part of its activities to attempting to
influence legislation for purposes of this section if, in any
12-month period in the preceding three years, more than 10
percent of the organization's expenditures were made to influence
legislation.
(e) A nonprofit wildlife conservation association and its local
chapters, affiliates, wildlife cooperatives, or units are
qualified nonprofit organizations under this chapter if the
parent association meets the eligibility criteria under this
section other than the requirement prescribed by Subsection
(a)(3), (b)(3), (b-1)(3), or (c)(3), as applicable. An
association or a local chapter, affiliate, wildlife cooperative,
or unit that is eligible under this subsection may not use any
proceeds from a raffle conducted under this chapter to attempt to
influence legislation or participate or intervene in a political
campaign on behalf of a candidate for public office in any
manner, including by publishing or distributing a statement or
making a campaign contribution. A nonprofit wildlife
conservation association may conduct two raffles each year and
each local chapter, affiliate, wildlife cooperative, or unit may
conduct two raffles each year under this chapter. For purposes
of this section, a nonprofit wildlife conservation association
includes an association that supports wildlife, fish, or fowl.
Acts 1999, 76th Leg., ch. 388, Sec. 1, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch.
34, Sec. 1, eff. May 9, 2005.
Acts 2005, 79th Leg., Ch.
929, Sec. 2, eff. June 18, 2005.
Acts 2009, 81st Leg., R.S., Ch.
936, Sec. 1, eff. June 19, 2009.
Sec. 2002.004. IMPUTED ACTIONS OF ORGANIZATION. For purposes of
this chapter, an organization performs an act if a member,
officer, or agent of the organization performs the act with the
consent or authorization of the organization.
Acts 1999, 76th Leg., ch. 388, Sec. 1, eff. Sept. 1, 1999.
SUBCHAPTER B. OPERATION OF RAFFLE
Sec. 2002.051. RAFFLE AUTHORIZED. A qualified organization may
conduct a raffle subject to the conditions imposed by this
subchapter.
Acts 1999, 76th Leg., ch. 388, Sec. 1, eff. Sept. 1, 1999.
Sec. 2002.052. TIME AND FREQUENCY RESTRICTIONS. (a) In this
section, "calendar year" means a period beginning January 1 and
ending on the succeeding December 31.
(b) A raffle is not authorized by this chapter if the
organization sells or offers to sell tickets for or awards prizes
in the raffle in a calendar year in which the organization has
previously sold or offered to sell tickets for or awarded prizes
in two or more other raffles.
(c) The organization may not sell or offer to sell tickets for a
raffle during a period in which the organization sells or offers
to sell tickets for another raffle. If an organization violates
this subsection, neither of the raffles is authorized.
(d) Before selling or offering to sell tickets for a raffle, a
qualified organization shall set a date on which the organization
will award the prize or prizes in a raffle. The organization must
award the prize or prizes on that date unless the organization
becomes unable to award the prize or prizes on that date.
(e) A qualified organization that is unable to award a prize or
prizes on the date set under Subsection (d) may set another date
not later than 30 days from the date originally set on which the
organization will award the prize or prizes.
(f) If the prize or prizes are not awarded within the 30 days as
required by Subsection (e), the organization must refund or offer
to refund the amount paid by each person who purchased a ticket
for the raffle.
Acts 1999, 76th Leg., ch. 388, Sec. 1, eff. Sept. 1, 1999.
Amended by Acts 2003, 78th Leg., ch. 597, Sec. 1, eff. Sept. 1,
2003.
Sec. 2002.053. USE OF RAFFLE PROCEEDS. All proceeds from the
sale of tickets for a raffle must be spent for the charitable
purposes of the qualified organization.
Acts 1999, 76th Leg., ch. 388, Sec. 1, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch.
929, Sec. 3, eff. June 18, 2005.
Sec. 2002.054. RESTRICTIONS ON RAFFLE PROMOTION AND TICKET
SALES. (a) The organization may not:
(1) directly or indirectly, by the use of paid advertising,
promote a raffle through a medium of mass communication,
including television, radio, or newspaper;
(2) promote or advertise a raffle statewide; or
(3) sell or offer to sell tickets for a raffle statewide.
(b) The organization may not compensate a person directly or
indirectly for organizing or conducting a raffle or for selling
or offering to sell tickets to a raffle.
(c) Except as provided by Section 2002.0541, the organization
may not permit a person who is not authorized by the organization
to sell or offer to sell raffle tickets.
Acts 1999, 76th Leg., ch. 388, Sec. 1, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch.
929, Sec. 4, eff. June 18, 2005.
Acts 2005, 79th Leg., Ch.
1006, Sec. 2, eff. September 1, 2005.
Acts 2007, 80th Leg., R.S., Ch.
921, Sec. 12.003, eff. September 1, 2007.
Sec. 2002.0541. REVERSE RAFFLE. (a) A qualified organization
may conduct a reverse raffle as provided by this section.
(b) Notwithstanding Section 2002.056(a), a refund of the
purchase price of a ticket may be awarded as a raffle prize in a
reverse raffle.
(c) Notwithstanding Section 2002.055(3), after the drawing of
tickets in a reverse raffle has begun, the qualified organization
conducting the raffle may auction off additional tickets to
persons who are present at the drawing for a price other than the
price printed on the ticket.
(d) After the drawing of tickets in a reverse raffle has begun,
the qualified organization may permit a ticket holder present at
the drawing to resell the ticket to another person present at the
drawing for an amount greater than the original purchase price of
the ticket. The sale must be made through a designated
representative of the organization, and not less than 10 percent
of the sale proceeds must be retained by the organization.
(e) Notwithstanding Section 2002.055(3), after the drawing of
tickets in a reverse raffle has begun, the qualified organization
may permit the holder of a previously drawn ticket:
(1) to purchase additional chances for the ticket to be selected
to win a prize; or
(2) to purchase additional tickets for the raffle.
(f) Only the portion of the proceeds from the resale of a ticket
under Subsection (d) retained by the organization are subject to
Section 2002.053. All proceeds from the sale of additional
chances for a ticket under Subsection (e) are considered to be
proceeds from the sale of the ticket for purposes of Section
2002.053.
Added by Acts 2005, 79th Leg., Ch.
1006, Sec. 3, eff. September 1, 2005.
Sec. 2002.055. TICKET DISCLOSURES. The following information
must be printed on each raffle ticket sold or offered for sale:
(1) the name of the organization conducting the raffle;
(2) the address of the organization or of a named officer of the
organization;
(3) the ticket price;
(4) a general description of each prize having a value of more
than $10 to be awarded in the raffle; and
(5) the date on which the raffle prize or prizes will be
awarded.
Acts 1999, 76th Leg., ch. 388, Sec. 1, eff. Sept. 1, 1999.
Amended by Acts 2003, 78th Leg., ch. 597, Sec. 2, eff. Sept. 1,
2003.
Sec. 2002.056. RESTRICTIONS ON PRIZES. (a) A prize offered or
awarded at a raffle may not be money.
(b) Except as provided by Subsections (b-1) and (c), the value
of a prize offered or awarded at a raffle that is purchased by
the organization or for which the organization provides any
consideration may not exceed $50,000.
(b-1) The value of a residential dwelling offered or awarded as
a prize at a raffle that is purchased by the organization or for
which the organization provides any consideration may not exceed
$250,000.
(c) A raffle prize may consist of one or more tickets in the
state lottery authorized by Chapter 466, Government Code, with a
face value of $50,000 or less, without regard to whether a prize
in the lottery game to which the ticket or tickets relate exceeds
$50,000.
(d) A raffle is not authorized by this chapter unless the
organization:
(1) has the prize to be offered in the raffle in its possession
or ownership; or
(2) posts bond with the county clerk of the county in which the
raffle is to be held for the full amount of the money value of
the prize.
Acts 1999, 76th Leg., ch. 388, Sec. 1, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch.
929, Sec. 5, eff. June 18, 2005.
Sec. 2002.057. TICKET SALE ON UNIVERSITY PROPERTY. An
institution of higher education, as defined by Section 61.003,
Education Code, shall allow a qualified organization that is a
student organization recognized by the institution to sell raffle
tickets at any facility of the institution, subject to reasonable
restrictions on the time, place, and manner of the sale.
Acts 1999, 76th Leg., ch. 388, Sec. 1, eff. Sept. 1, 1999.
Sec. 2002.058. INJUNCTIVE ACTION AGAINST UNAUTHORIZED RAFFLE.
(a) A county attorney, district attorney, criminal district
attorney, or the attorney general may bring an action in county
or district court for a permanent or temporary injunction or a
temporary restraining order prohibiting conduct involving a
raffle or similar procedure that:
(1) violates or threatens to violate state law relating to
gambling; and
(2) is not authorized by this chapter or other law.
(b) Venue for an action under this section is in the county in
which the conduct occurs or in which a defendant in the action
resides.
Acts 1999, 76th Leg., ch. 388, Sec. 1, eff. Sept. 1, 1999.