11VAC15-22 Charitable Gaming Rules and Regulations

REGULATIONS

Vol. 25 Iss. 22 - July 06, 2009

TITLE 11. GAMING

CHARITABLE GAMING BOARD

Chapter 22

Proposed Regulation

Title of Regulation: 11VAC15-22. Charitable Gaming Rules and Regulations (amending 11VAC15-22-10, 11VAC15-22-40, 11VAC15-22-50, 11VAC15-22-80).

Statutory Authority: §§ 2.2-2456, 18.2-340.15, and 18.2-340.19 of the Code of Virginia.

Public Hearing Information: No public hearings are scheduled.

Public Comments: Public comments may be submitted until 5 p.m. on September 4, 2009.

Agency Contact: Betty Bowman, Director, Division of Charitable Gaming, 101 N. 14th Street, 17th Street, James Monroe Bldg, Richmond, VA 23219, telephone [phone], FAX [phone], or email [e-mail].

Basis: Section 18.2-340.15 of the Code of Virginia gives the Charitable Gaming Board the authority to promulgate regulations under which gaming shall be conducted. Section 18.2-340.19 of the Code of Virginia describes the regulations the board can promulgate. Section 2.2-2456 of the Code of Virginia describes the duties of the board, including the authority to promulgate regulations.

Purpose: These changes do not have any adverse impact on the health, safety, or welfare to the citizens of Virginia. The impact is directly to charitable organizations that have been designated by the internal revenue service as 501(c) not-for-profit entities that manage and report their gaming operations to the division. The changes for 2007 are directly related to financial reporting and how they report game operations.

Substance: The Charitable Gaming Board proposes several amendments to these regulations to reflect changes to the Code of Virginia pursuant to the 2007 Acts of Assembly. Additionally, the board proposes to (i) specify that paid callers and managers may not play bingo at any session they have worked and may not purchase instant bingo, pull-tab, or seal card products from organizations they assist on the day they have worked or later from any deal they have helped sell, (ii) no longer allow organizations to substitute an annual financial report for a quarterly report, (iii) cap cumulative late fees for report filing at $750, and (iv) add clarifying definitions.

Issues: Changes were due to legislative mandates from the 2007 Acts of Assembly. The existing regulations are not reflective of these actions and no other alternatives were considered. It is anticipated that the proposed regulatory action will pose no disadvantages to the public or the Commonwealth.

The Department of Planning and Budget's Economic Impact Analysis:

Summary of the Proposed Amendments to Regulation. The Charitable Gaming Board (Board) proposes several amendments to these regulations to reflect changes to the Code of Virginia pursuant to the 2007 Acts of Assembly. Additionally, the board proposes to 1) specify that paid callers and managers may not play bingo at any session they have worked and may not purchase instant bingo, pull-tab, or seal card products from organizations they assist on the day they have worked or later from any deal they have helped sell, 2) no longer allow organizations to substitute an annual financial report for a quarterly report, 3) cap cumulative late fees for report filing at $750, and 4) add clarifying definitions.

Result of Analysis. The benefits likely exceed the costs for all proposed changes.

Estimated Economic Impact. The current regulations specify that volunteer game workers may not play bingo at any session they have worked after the session has started. Volunteer game workers may not purchase directly or through others instant bingo, pull-tab, or seal card products from organizations they assist on the day they have volunteered or from any deal they have helped sell, whichever is later.

There have been some reported instances where paid callers and managers have played bingo at sessions where they have worked.¹ According to the Department of Charitable Gaming (Department), it was not the intent of the board to ban volunteer game workers from playing bingo at sessions where they work, but permit paid workers to do so. Having paid workers be possible winners does put the fairness of the games into question. Therefore the board proposes to specify that paid callers and managers may not play bingo at any session they have worked and may not purchase instant bingo, pull-tab, or seal card products from organizations they assist on the day they have worked or later from any deal they have helped sell. Specifying this in the regulations will make it easier for the board to enforce this prohibition. Thus adding this language to these regulations should produce a net benefit.

Under both the current and proposed regulations, organizations realizing any gross gaming receipts in any calendar quarter are required to file a quarterly report of receipts and disbursements on a form prescribed by the department. The current regulations allow the annual financial report to substitute for a quarterly report if the organization has no further charitable gaming income during the remainder of the reporting period and the annual report is filed by the due date for the applicable calendar quarter. The Board proposes to no longer permit the annual report to substitute for a quarterly report. According to the department, it is not uncommon for charitable organizations staffed by volunteers to lose track of their administrative duties. The department believes that requiring organizations to report quarterly without exception will make it less likely that they will have to shutdown charitable games due to poor management. The Department estimates that if organizations file their quarterly reports through the department website it should only take about five minutes of their time, and perhaps an hour for those without Internet access. If requiring organizations to report quarterly without exception does in fact make it less likely that some charitable games will have to be shutdown due to poor management, then the proposal will likely produce a net benefit since the cost of complying is so small.

Under both the current and proposed regulations, organizations failing to file required reports, request an extension or make fee payments when due are charged a penalty of $25 per day. The current regulations place no limit on accumulated fees. The board proposes to no longer add to late fees beyond 30 days and $750. The board believes that greater penalties do not significantly add to the incentive for organizations to submit reports and take away from the benefits to the public of these charitable organizations. Thus capping late fees late will likely produce a net benefit.

Businesses and Entities Affected. The proposed amendments affect the 560 charitable organizations in the Commonwealth.²

Localities Particularly Affected. The proposed amendments do not disproportionately affect particular localities.

Projected Impact on Employment. The proposed amendments will not significantly affect employment.

Effects on the Use and Value of Private Property. The proposed amendments will not significantly affect the use and value of private property.

Small Businesses: Costs and Other Effects. The proposed amendments will not significantly affect small businesses.

Small Businesses: Alternative Method that Minimizes Adverse Impact. The proposed amendments will not significantly affect small businesses.

Real Estate Development Costs. The proposed amendments will not significantly affect real estate development costs.

Legal Mandate. The Department of Planning and Budget (DPB) has analyzed the economic impact of this proposed regulation in accordance with § 2.2-4007.04 of the Administrative Process Act and Executive Order Number 36 (06). Section 2.2-4007.04 requires that such economic impact analyses include, but need not be limited to, the projected number of businesses or other entities to whom the regulation would apply, the identity of any localities and types of businesses or other entities particularly affected, the projected number of persons and employment positions to be affected, the projected costs to affected businesses or entities to implement or comply with the regulation, and the impact on the use and value of private property. Further, if the proposed regulation has adverse effect on small businesses, § 2.2-4007.04 requires that such economic impact analyses include (i) an identification and estimate of the number of small businesses subject to the regulation; (ii) the projected reporting, recordkeeping, and other administrative costs required for small businesses to comply with the regulation, including the type of professional skills necessary for preparing required reports and other documents; (iii) a statement of the probable effect of the regulation on affected small businesses; and (iv) a description of any less intrusive or less costly alternative methods of achieving the purpose of the regulation. The analysis presented above represents DPB's best estimate of these economic impacts.

___________________________

¹ Source: Department of Charitable Gaming

² Datum source: Department of Charitable Gaming

Agency's Response to the Department of Planning and Budget's Economic Impact Analysis: The agency concurs with the economic impact analysis submitted by the Department of Planning and Budget.

Summary:

The proposed amendments (i) clarify and add definitions; (ii) specify that paid callers and managers may not play bingo at any session they have worked and may not purchase instant bingo, pull-tab, or seal card products from organizations they assist on the day they have worked or later from any deal they have helped sell; (iii) no longer allow organizations to substitute an annual financial report for a quarterly report; and (iv) cap cumulative late fees at $750 for late report filing.

Part I
Definitions

11VAC15-22-10. Definitions.

In addition to the definitions contained in § 18.2-340.16 of the Code of Virginia, the words and terms below, when used in this chapter, shall have the following meanings unless the context clearly indicates otherwise:

"Bingo caller" means an individual who operates the equipment used for the random selection of bingo numbers and announces the selected bingo numbers during the bingo session.

"Bingo manager" or "game manager" means an individual who is a bona fide member of the organization and has been designated by the organization's management as being responsible for the operation of a particular session, for ensuring the compliance of the specific session with all applicable laws and rules and regulations, and who is present during the conduct of the designated session.

"Board" means the Virginia Charitable Gaming Board.

"Board of directors" means the board of directors, managing committee, or other supervisory body of a qualified organization.

"Calendar day" means the period of 24 consecutive hours commencing at 12:01 a.m. and concluding at midnight.

"Calendar week" means the period of seven consecutive calendar days commencing at 12:01 a.m. on Sunday and ending at midnight the following Saturday.

"Cash" means United States currency or coinage.

"Concealed face bingo card" means a nonreusable bingo card constructed to conceal the card face. This type of card is commonly referred to under trade names such as "Tear-open" or "Bonanza Bingo."

"Conduct" means the actions associated with the provision of a gaming operation during and immediately before or after the permitted activity, which may include, but not be limited to (i) selling bingo cards or packs, electronic devices, instant bingo, or pull-tab cards, or raffle tickets; (ii) calling bingo games; (iii) distributing prizes; and (iv) any other services provided by volunteer workers.

"DCG number" means a unique identification number issued by the department.

"Daubing" means covering a square containing a number called with indelible ink or otherwise concealing the number on a card or an electronic facsimile of a card.

"Deal" means each separate package or series of packages consisting of one game of instant bingo, pull-tabs, or seal cards with the same serial number.

"Decision bingo" means a bingo game where the cost to a player to play is dependent on the number of balls called and the prize payout is in direct relationship to the number of participants and the number of balls called, but shall not exceed statutory prize limits for a regular bingo game.

"Department" means the Virginia Department of Charitable Gaming.

"Director" means the Director of the Virginia Department of Charitable Gaming.

"Discount" means any reduction in cost of admission or game packs or any other purchases through use of coupons, free packs, or other similar methods.

"Disinterested player" means a player who is unbiased.

"Disposable paper card" means a nonreusable, paper bingo card manufactured with preprinted numbers.

"Door prize" means any prize awarded by the random drawing or random selection of a name or number based solely on attendance at a gaming session.

"Electronic bingo device" means an electronic device that uses proprietary software or hardware, or in conjunction with commonly available software and computers, displays facsimiles of bingo cards and allows a player to daub such cards.

"Fiscal year" or "annual reporting period" means the 12-month period beginning January 1 and ending December 31 of any given year.

"Flare" means a piece of paper, cardboard, or similar material that bears printed information relating to the name of the manufacturer or logo, name of the game, card count, cost per play, serial number, the number of prizes to be awarded, and the specific prize amounts in a deal of instant bingo, pull-tab, or seal cards.

"Free space number," "perm number," "center number," "card number" or "face number" means the number generally printed in the center space of a bingo card that identifies the unique pattern of numbers printed on that card.

"Game program" means a written list of all games to be played including, but not limited to, the sales price of all bingo paper and electronic bingo devices, pack configuration, prize amounts to be paid during a session for each game, and an indication whether prize amounts are fixed or are based on attendance.

"Immediate family" means one's spouse, parent, child, sibling, grandchild, grandparent, mother or mother-in-law, father-in-law, or stepchild.

"Interested persons" means the president, an officer, or bingo manager of any qualified organization which that is exempt or is a permit applicant or holds a permit to conduct charitable gaming or the owner, director, officer, or partner of an entity engaged in supplying charitable gaming supplies to organizations.

"IRS" means the United States Internal Revenue Service.

"Lucky Seven" means a bingo game as authorized in § 18.2-340.33 (9a) (b) of the Code of Virginia.

"Management" means the provision of oversight of a gaming operation, which may include, but is not limited to, the responsibilities of applying for and maintaining a permit or authorization, compiling, submitting, and maintaining required records and financial reports, and ensuring that all aspects of the operation are in compliance with all applicable statutes and regulations.

"Manufacturer" means a person who assembles from raw materials or subparts a completed piece of bingo or other charitable gaming equipment or supplies. "Manufacturer" also means a person who modifies, converts, adds, or removes parts to or from bingo or other charitable gaming equipment or supplies to further their promotion or sale for the conduct of charitable gaming.

"Operation" means the activities associated with production of a charitable gaming activity, which may include, but not be limited to (i) the direct on-site supervision of the conduct of charitable gaming; (ii) coordination of volunteers; and (iii) all responsibilities of charitable gaming designated by the organization's management.

"Owner" means any individual with financial interest of 10% or more in a supplier.

"Pack" means sheets of bingo paper or electronic facsimiles assembled in the order of games to be played. This may include specials and jackpots, but shall not include any bingo jackpots, winner-take-all, Lucky Seven, or raffle.

"Prize" means cash, merchandise, certificate, or other item of value awarded to a winning player.

"Progressive seal card" means a seal card game in which a prize is carried forward to the next deal if not won when a deal is completed.

"Remuneration" means payment in cash or the provision of anything of value for goods provided or services rendered.

"Seal card" means a board or placard used in conjunction with a deal of the same serial number which that contains one or more concealed areas that, when removed or opened, reveal a predesignated winning number, letter, or symbol located on that board or placard.

"Serial number" means a unique number printed by the manufacturer on each bingo card in a set, each instant bingo, pull-tab, or seal card in a deal, each electronic bingo device, or each door prize ticket.

"Series number" means the number of unique card faces contained in a set of disposable bingo paper cards or bingo hard cards. A 9000 series, for example, has 9000 unique faces.

"Session" means a period of time during which one or more bingo games are conducted that begins with the selection of the first ball for the first game and ends with the selection of the last ball for the last game.

"Treasure chest" means a raffle including a locked treasure chest containing a prize that a participant, selected through some other authorized charitable game, is afforded the chance to select from a series of keys a predetermined key that will open the locked treasure chest to win a prize.

"Use of proceeds" means the use of funds derived by an organization from its charitable gaming activities which that are disbursed for those lawful religious, charitable, community, or educational purposes. This includes expenses relating to the acquisition, construction, maintenance, or repair of any interest in the real property involved in the operation of the organization and used for lawful religious, charitable, community, or educational purposes.

"WINGO" is a variation of a traditional bingo game that uses visual devices rather than a verbal caller and is played by hearing impaired persons.

Part III
Conduct of Games, Rules of Play, Electronic Bingo

11VAC15-22-40. Conduct of bingo, instant bingo, pull-tabs, seal cards, and raffles.

A. Organizations subject to this chapter shall post their permit at all times on the premises where charitable gaming is conducted.

B. No individual shall provide any information or engage in any conduct that alters or is intended to alter the outcome of any charitable game.

C. Individuals under 18 years of age may play bingo provided such persons are accompanied by a parent or legal guardian. It shall be the responsibility of the organization to ensure that such individuals are eligible to play. An organization's house rules may further limit the play of bingo or purchase raffle tickets by minors.

D. Individuals under the age of 18 may sell raffle tickets for a qualified organization raising funds for activities in which they are active participants.

E. No individual under the age of 18 may participate in the management or operation of bingo games. Individuals 14 through 17 years of age may participate in the conduct of a bingo game provided the organization permitted for charitable gaming obtains and keeps on file written parental consent from the parent or legal guardian and verifies the date of birth of such youth. An organization's house rules may further limit the involvement of minors in the conduct of bingo games.

F. No qualified organization shall sell any instant bingo, pull-tab, or seal card to any individual under 18 years of age. No individual under 18 years of age shall play or redeem any instant bingo, pull-tab, or seal card.

G. Immediate family members of bona fide members and surviving spouses of deceased bona fide members may participate as volunteer game workers.

H. All volunteer game workers shall have in their possession a picture identification, such as a driver's license or other government-issued identification, while participating in the management, operation, or conduct of a bingo game.

I. A game manager who is a bona fide member of the organization and is designated by the organization's management as the person responsible for the operation of the bingo game during a particular session shall be present any time a bingo game is conducted.

J. Organizations shall ensure that all charitable gaming equipment is in working order before charitable gaming activities commence.

K. Any organization selling bingo, instant bingo, pull-tabs, or seal cards shall:

1. Maintain a supplier's invoice or a legible copy thereof at the location where the gaming is taking place and cards are sold. The original invoice or legible copy shall be stored in the same storage space as the gaming supplies. All gaming supplies shall be stored in a secure area that has access limited only to bona fide members of the organization; and

2. Pay for all gaming supplies only by a check drawn on the charitable gaming account of the organization.

A complete inventory of all such gaming supplies shall be maintained by the organization on the premises where the gaming is being conducted.

L. A volunteer working a bingo session may receive complimentary food and nonalcoholic beverages provided on premises, as long as the retail value of such food and beverages does not exceed $15 for each session.

M. Permitted organizations shall not commingle records, supplies, or funds from permitted activities with those from instant bingo, pull-tabs, or seal cards sold in social quarters in accordance with § 18.2-340.26:1 of the Code of Virginia.

N. Individuals who are not members of an organization or are members who do not participate in any charitable gaming activities may be paid reasonable fees for preparation of quarterly and annual financial reports.

O. No free packs, free electronic bingo devices, discounts, or remuneration in any other form shall be provided directly or indirectly to volunteers, members of their family, or individuals residing in their household. The reduction of tuition, dues, or any fees or payments due as a result of a member or shareholder, or anyone in their household, working bingo games or raffles is prohibited.

P. Individuals providing security for an organization's charitable gaming activity shall not participate in the charitable gaming activity and shall not be compensated with charitable gaming supplies or with rentals of electronic bingo devices.

Q. No organization shall award any prize money or any merchandise valued in excess of the amounts specified by the Code of Virginia.

R. Multiple bingo sessions shall be permitted in a single premises as long as the sessions are distinct from one another and are not used to advertise or do not result in the awarding of more in prizes than is permitted for a single qualified organization. All leases for organizations to conduct charitable gaming in a single premises shall be for sessions separated by an interval of at least one hour. Bingo sales for the subsequent session may take place during the one-hour break once the building is cleared of all patrons and workers from the previous session.

S. All bingo and instant bingo, pull-tabs, or seal card sales must occur within the time specified on the charitable gaming permit.

T. Instant bingo, pull-tabs, or seal cards shall only be sold in conjunction with a regular bingo session, except as provided in § 18.2-340.26:2 of the Code of Virginia.

U. No sales of instant bingo, pull tabs, or seal card sales cards sold in conjunction with a regular bingo session shall take place more than two hours before or after a session. If multiple sessions are held at the same location, no instant bingo, pull-tab, or seal card sales shall be conducted during the required one hour break between sessions. The department may take action if it believes that a regular bingo session is not legitimate or is being conducted in a manner such that instant bingo, pull-tabs, or seal cards are not being sold in conjunction with a normal, regular bingo session.

U. V. Only a volunteer game worker of qualified organizations may rent, exchange, or otherwise provide electronic bingo devices to players.

V. W. A qualified organization shall conduct only bingo games and raffles listed on a game program for that session. The program shall list all prize amounts. If the prize amounts are determined by attendance or at the end of a game, the game program shall list the attendance required for the prize amount or disclose that prizes shall be determined at the end of a game and the method for determining the prize amount. In such case, the organization shall announce the prize amount at the end of the game.

W. X. A qualified organization selling instant bingo, pull-tabs, or seal cards shall post a flare provided by the manufacturer at the location where such cards are sold. All such sales and prize payouts shall be in accordance with the flare for that deal.

X. Y. Only qualified organizations, facilities in which qualified organizations play bingo and suppliers permitted by the department shall advertise a bingo game. Providing players with information about bingo games through printed advertising is permitted, provided the name of the qualified organization shall be in a type size equal to or larger than the name of the premises, hall, or the word "bingo." Printed advertisements shall identify the use of proceeds percentage reported in the past quarter or fiscal year.

Y. Z. Raffles which that award prizes based on a percentage of gross receipts shall use prenumbered tickets.

Z. AA. The following rules shall apply to instant bingo, pull-tab, or seal card dispensing devices:

1. A dispenser shall only be used at a location and time during which a qualified organization holds a permit to conduct charitable gaming. Only cards purchased by an organization to be used during the organization's charitable gaming activity shall be in the dispenser.

2. Keys to the dispensing area and coin/cash box shall be in the possession and control of the game manager or designee of the organization's board of directors at all times. Keys shall at all times be available at the location where the dispensing device is being used.

3. The game manager or designee shall provide access to a department agent for inspection upon request.

4. Only a volunteer game worker of an organization may stock the device, remove cash, or pay winners' prizes.

AA. BB. Organizations shall only purchase gaming supplies from a supplier or manufacturer who has a current permit issued by the department.

BB. CC. An organization shall not alter bingo paper from its original form as invoiced from the supplier.

CC. DD. The total amount of all discounts given by any organization during any fiscal year shall not exceed 1.0% of the organization's prior year gross receipts.

11VAC15-22-50. Rules of play.

A. Each organization shall adopt "house rules" regarding conduct of the game. Such rules shall be consistent with the provisions of the law and this chapter. "House rules" shall be conspicuously posted or, at an organization's option, printed on the game program.

B. All players shall be physically present at the location where the balls for a bingo game are drawn to play the game or to claim a prize. Seal card prizes that can only be determined after a seal is removed or opened must be claimed within 30 days of the close of a deal. All other prizes must be claimed on the game date.

C. The following rules of play shall govern the sale of instant bingo, pull-tabs, and seal cards:

1. No cards that have been marked, defaced, altered, tampered with, or otherwise constructed in a manner that tends to deceive the public or affect the chances of winning or losing shall be placed into play.

2. Winning cards shall have the winning symbol or number defaced or punched immediately after redemption by the organization's authorized representative.

3. An organization may commingle unsold instant bingo cards and pull-tabs with no more than one additional deal. The practice of commingling deals shall be disclosed to the public via house rules or in a similar manner. Seal card deals shall not be commingled.

4. If a deal is not played to completion and unsold cards remain, the remaining cards shall be sold on the next date the same type of ticket is scheduled to be sold. If no future date is anticipated, the organization shall, after making diligent efforts to sell the entire deal, consider the deal closed or completed. The unsold cards shall be retained for three years following the close of the fiscal year and shall not be opened.

5. All seal card games purchased shall contain the sign-up sheet, seals, and the cards packaged together in each deal.

6. Progressive seal card prizes not claimed within 30 days shall be carried forward to the next progressive game in progress and paid to the next progressive game prize winner.

D. Volunteer game workers or paid callers and managers may not play bingo at any session they have worked after the session has started. Volunteer game workers and paid callers and managers may not purchase directly or through others instant bingo, pull-tab, or seal card products from organizations they assist on the day they have volunteered or worked or from any deal they have helped sell, whichever is later.

E. Electronic bingo.

1. Electronic bingo devices may be used by bingo players in the following manner:

a. Players must input into the device each number called;

b. Players must notify the game operator or caller of a winning pattern of bingo by a means other than use of the electronic device;

c. Players are limited to playing a maximum of 54 card faces per device per game;

d. Electronic bingo devices shall not be reserved for players. Each player shall have an equal opportunity to use the available devices on a first-come, first-served basis;

e. Each electronic bingo device shall produce a player receipt with the organization name, date, time, location, sequential transaction or receipt number, number of electronic bingo cards loaded, cost of electronic bingo cards loaded, date and time of the transaction, and device identification number. Images of cards or faces stored in an electronic device must be exact duplicates of the printed faces if faces are printed;

f. Department agents may examine and inspect any electronic bingo device and related system. Such examination and inspection shall include immediate access to the device and unlimited inspection of all parts and associated systems and may involve the removal of equipment from the game premises for further testing;

g. All electronic bingo devices must be loaded or enabled for play on the premises where the game will be played;

h. All electronic bingo devices shall be rented or otherwise provided to a player only by an organization and no part of the proceeds of the rental of such devices shall be paid to a landlord, his employee, agent, or member of his immediate family; and

i. If a player's call of a bingo is disputed by another player or if a department agent makes a request, one or more cards stored on an electronic bingo device shall be printed by the organization.

2. Players may exchange a defective electronic bingo device for another device provided a disinterested player verifies that the device is not functioning. A disinterested player shall also verify that no numbers called for the game in progress have been keyed into the replacement device prior to the exchange.

F. The following rules of play shall govern the conduct of raffles:

1. Before a prize drawing, each stub or other detachable section of each ticket sold shall be placed into a receptacle from which the winning tickets shall be drawn. The receptacle shall be designed so that each ticket placed in it has an equal chance to be drawn.

2. All prizes shall be valued at fair market value.

G. The following rules shall apply to "decision bingo" games:

1. Decision bingo shall be played on bingo cards in the conventional manner.

2. Players shall enter a game by paying a predetermined amount for each card face in play.

3. After the calling of each set of three numbers, players wishing to continue playing shall pay an additional predetermined fee for each card in play.

4. The prize amount shall be the total of all fees not to exceed $100. Any excess funds shall be retained by the organization.

5. The predetermined amounts in subdivisions 2 and 3 of this subsection shall be printed in the game program. The prize amount for a game shall be announced before the prize is paid to the winner.

H. The following rules shall apply to "treasure chest" games:

1. The organization shall list the treasure chest game on the bingo game program as a "Treasure Chest Raffle."

2. The organization shall have house rules posted that describe how the game is to be played.

3. The treasure chest participant shall only be selected through some other authorized charitable game at the same bingo session.

4. The organization shall account for all funds as treasure chest/raffle sales on the session reconciliation form.

5. If the player does not open the lock on the treasure chest, the game manager or his designee shall proceed to try every key until the correct key opens the treasure chest lock to show all players that one of the keys will open the lock.

I. The following rules shall apply to "Lucky Seven" games:

1. General rules.

a. A "Lucky Seven" bingo card shall have a single face where seven numbers shall be chosen.

b. A "Lucky Seven" sheet shall have multiple faces where seven numbers shall be chosen per face.

c. A player shall select seven numbers between the numbers of 1 and 75.

d. No duplicate numbers shall be played on a purchased face.

e. If a duplicate number appears on a face, then the card shall be void.

f. "Lucky Seven" shall be played on a bingo card or sheet, or electronic facsimile thereof.

g. "Lucky Seven" bingo paper (i.e., card(s) and sheet(s)) shall conform to the construction and randomization standards in the Charitable Gaming Supplier Regulations (11VAC15-31).

h. "Lucky Seven" shall be sold separately from the bingo card(s) or sheet(s) issued for any other bingo game.

i. "Lucky Seven" shall not be a part of any pack of any kind such as a convenience pack, super pack, etc.

j. The financial accounting for "Lucky Seven" must include separate accounting for the "Lucky Seven" sales and prize payouts as well as informational entries for each session that records the following for the progressive jackpot: beginning balance, additions to the progressive jackpot, payouts, and ending balance that is to be carried over to the next session.

k. "Lucky Seven" shall be listed on the game program for the session it is played.

l. "Lucky Seven" game card(s) or sheet(s) pricing shall be listed on the game program.

m. The pricing of "Lucky Seven" bingo card(s) or sheet(s) shall be by the number of faces.

n. The price for a "Lucky Seven" bingo card or sheet face shall be the same regardless of the number of faces purchased by a player.

o. No discounts shall be allowed.

p. "Lucky Seven" paper shall not be given away as a door prize.

q. There shall be no more than one "Lucky Seven" game per organization per calendar day.

r. No volunteer may play "Lucky Seven" at any session where he has worked.

s. The pricing for "Lucky Seven" faces shall remain constant from when the progressive jackpot is first started until the same jackpot has been won.

2. Progressive jackpot rules.

a. "Lucky Seven" shall begin with the calling of 16 random numbers by the game caller. These numbers will determine the winner of the "Lucky Seven" progressive jackpot. If the progressive jackpot has not been won during the session, then the maximum number of numbers called for the following session shall be increased by one number. This shall continue until the progressive jackpot has been won.

b. The amount of the progressive jackpot shall be announced prior to the game being played at the session. Multiple winners shall evenly split the progressive jackpot.

c. The initial progressive jackpot for the "Lucky Seven" game shall not exceed $500.

d. The organization shall take into consideration the number of players at its sessions when deciding the starting amount for its progressive jackpot.

e. Any increase in the amount for the "Lucky Seven's" progressive jackpot game shall be 50% of the moneys received from the sales of "Lucky Seven" bingo card(s) or sheet(s) during the previous session for which the sales occurred or $100 per session, whichever amount is less.

f. Once the progressive jackpot has reached $5,000, the organization shall not add any additional money generated from the sales of its "Lucky Seven" bingo card(s) or sheet(s) from a session to the jackpot.

g. The amount of numbers needed to win the "Lucky Seven" progressive jackpot and the amount of the jackpot shall be posted in a conspicuous place inside the bingo hall.

h. Once the progressive jackpot has been won, the next progressive jackpot shall not start in excess of $500.

3. Regular or special prize rules.

a. If the progressive jackpot has not been won during the session, then the game caller shall continue to call numbers at random until there is a verified bingo winner of the regular or special prize amount.

b. The regular or special prize amount shall be announced prior to the game being played. Multiple winners shall evenly split the regular or special prize.

c. The regular or special prize amount shall be 50% of the moneys received from the sales of "Lucky Seven" bingo card(s) or sheet(s) during the current session or $100, whichever amount is less.

d. The regular or special prize amount shall not be awarded when the progressive jackpot is won by a player.

J. The following rules shall apply to "WINGO":

1. "WINGO" shall be played only for the hearing impaired players.

2. "WINGO" shall utilize a visual device such as an oversized deck of cards in place of balls selected from a blower.

3. A caller must be in an area visible to all players and shall randomly select cards or other visual devices one at a time and display them so that all players can see them.

4. The organization must have house rules for "WINGO" and the rules shall identify how players indicate that they have won.

5. All financial reporting shall be consistent with reporting for a traditional bingo game.

11VAC15-22-80. Financial reporting, penalties, inspections and audits.

A. Each charitable gaming permit holder shall file an annual report of receipts and disbursements by March 15 of each year on a form prescribed by the department. The annual report shall cover the activity for the fiscal year.

B. The annual report shall be accompanied by the audit and administration fee as established by the department for the fiscal year unless the fee has been remitted with quarterly reports. Volunteer fire departments or rescue squads or auxiliary units thereof that have been recognized in accordance with § 15.2-955 of the Code of Virginia shall be exempt from the payment of audit and administration fees.

C. Except for volunteer fire departments or rescue squads or auxiliary units thereof that have been recognized in accordance with § 15.2-955 of the Code of Virginia, an organization desiring an extension to file annual reports for good cause shall pay the projected audit and administration fee by March 15 and request the extension in writing on a form prescribed by the department.

D. Unless exempted by § 18.2-340.23 of the Code of Virginia, qualified organizations realizing any gross gaming receipts in any calendar quarter shall file a quarterly report of receipts and disbursements on a form prescribed by the department as follows:

Quarter Ending	Date Due
March 31	June 1
June 30	September 1
September 30	December 1
December 31	March 1

Quarterly reports shall be accompanied by the appropriate audit and administration fee. Volunteer fire departments or rescue squads or auxiliary units thereof that have been recognized in accordance with § 15.2-955 of the Code of Virginia shall be exempt from the payment of audit and administration fees. An annual financial report may substitute for a quarterly report if the organization has no further charitable gaming income during the remainder of the reporting period and the annual report is filed by the due date for the applicable calendar quarter.

E. Organizations failing to file required reports, request an extension or make fee payments when due shall be charged a penalty of $25 per day from the due date until such time as the required report is filed up to a maximum of 30 days and $750. The failure to file such reports within 30 days of the time such reports are due shall cause the automatic revocation of the permit, and no organization shall conduct any bingo game or raffle thereafter until the report is filed and a new permit is obtained.

F. Any qualified organization in possession of funds derived from charitable gaming (including those who have ceased operations), regardless of when such funds may have been received or whether it has a valid permit from the department, shall file an annual financial report on a form prescribed by the department on or before March 15 of each year until such funds are depleted. If an organization ceases the conduct of charitable gaming, it shall provide the department with the name of an individual who shall be responsible for filing financial reports. If no such information is provided, the president of an organization shall be responsible for filing reports until all charitable gaming proceeds are depleted.

G. If an organization has been identified through inspection, audit or other means as having deficiencies in complying with statutory or regulatory requirements or having ineffective internal controls, the department may impose restrictions or additional recordkeeping and financial reporting requirements.

H. Any records deemed necessary to complete an inspection, audit or investigation may be removed by the department, its employees or agents from the premises of an organization or any location where charitable gaming is conducted. The department shall provide a written receipt of such records at the time of removal.

VA.R. Doc. No. R08-960; Filed June 12, 2009, 11:17 a.m.