LOTTERIES ‑- GAMBLING ‑- OPERATION OF BINGO GAMES UNDER CHAPTER 9.47 RCW
(1) A member operating a bingo game under the provisions of RCW 9.47.390 may be compensated for doing so at a fixed hourly or other periodic rate so long as his compensation is not based upon a percentage of the receipts or net profits derived from the operation of such game.
(2) Such compensation as is paid to a member operating a bingo game under the provisions of RCW 9.47.390 may not be paid out of the proceeds derived from the game by the bona fide charitable or nonprofit organization which is operating said bingo game.
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December 27, 1972
Honorable John Bagnariol
P.O. Box 836
Renton, Washington 98055
Cite as: AGO 1972 No. 30
By letter previously acknowledged, you requested our opinion on certain questions pertaining to the conduct of bingo games by bona fide charitable or nonprofit organizations under the provisions of RCW 9.47.390. We divide and paraphrase your questions as follows:
(1) May a member operating a bingo game under the provisions of RCW 9.47.390 be compensated for doing so at a fixed hourly or other periodic rate so long as his compensation is not based upon a percentage of the receipts or net profits derived from the operation of such game?
(2) If question (1)is answered in the affirmative, may this compensation be paid out of the proceeds derived from the game by the bona fide charitable or nonprofit organization which is operating said bingo game?
We answer question (1) in the affirmative and question (2) in the negative for the reasons set forth in the following analysis.
[[Orig. Op. Page 2]]
RCW 9.47.390 is the codification of § 11, chapter 280, Laws of 1971, 1st Ex. Sess. This act, as amended by chapter 141, Laws of 1972, Ex. Sess., regulates the conduct of various gambling activities, including bingo games. As recently explained in our opinion of October 4, 1972, to State Representative Al Williams (copy enclosed), the basic theme or approach of this legislation is as follows:
". . . In simplest terms, chapter 280, supra, as amended in 1972, first draws a distinction between professional gambling activities and such social or nonprofessional gambling activities as bingo, raffles, or amusement games when conducted by either a bona fide charitable or nonprofit organization or an agricultural fair. And then, having drawn this distinction, the law proceeds to impose both criminal and civil penalties or sanctions with respect to professional gambling while regulating nonprofessional bingo, raffles or amusement games by means of civil sanctions only. . . ."1/ (Emphasis supplied)
In order to be excluded from the penalties for professional gambling, however, a bingo operation must be conducted in accordance with the definition of this game which is set forth in RCW 9.47.310 (11) as follows:
"'Bingo' means a game in which prizes are awarded on the basis of designated numbers or symbols on a card conforming to numbers or symbols selected at random and in which no cards are sold except at the time and place of said game, when said game is conducted by a bona fide charitable or nonprofit organization which does not conduct or allow its premises to be used for conducting bingo on more than three occasions per week and which does not conduct bingo in any location which is used for conducting bingo on more [[Orig. Op. Page 3]] than three occasions per week, or if an agricultural fair authorized under chapters 15.76 and 36.37 RCW, which does not conduct bingo on more than twelve consecutive days in any calendar year. . . ."2/
In addition, this definition goes on to provide that (except when operated by an agricultural fair),
". . . no person other than a bona fide member of said organization [may] take[s] any part in the management or operation of said game, and no person who takes any part in the management or operation of said game takes any part in the management or operation of any game conducted by any other organization or any other branch of the same organization and no part of the proceeds thereof inure to the benefit of any person other than the organization conducting said game."
Furthermore, any organization conducting bingo games must comply with the provisions of § 11 of the act, now codified as RCW 9.47.390, which provides that:
". . .
"The conduct of bingo games shall be subject to the following restrictions irrespective of whether the restrictions are contained in local laws or ordinances, but nothing herein shall be construed to prevent the inclusion within such local law or ordinance of other provisions imposing additional restrictions upon the conduct of such games:
[[Orig. Op. Page 4]]
"(a) No person, firm, association, corporation or organization other than as under the provisions of RCW 9.47.300 through 9.47.440 shall conduct such game, or shall obtain a lease for or otherwise make available for conducting bingo therein, a hall or other premises, for any consideration whatsoever, direct or indirect.
"(b) No bingo games shall be held, operated or conducted on or within any leased premises if rental under such lease is to be paid, wholly or partly, on the basis of a percentage of the receipts or net profits derived from the operation of such game, nor shall the rental under such lease exceed the usual rental for such premises in the same locality.
"(c) No bingo game shall be held, operated or conducted if the compensation to any person taking part in the management or operation of such game is based upon a percentage of the receipts or net profits derived from the operation of such game.
"(d) The entire net proceeds of any game of bingo and of any rental therefor shall be exclusively devoted to the lawful purposes of the organization permitted to conduct the same. Net proceeds for the purposes of this subsection shall mean that amount remaining after expenses for supplies, rental, and prizes awarded to participants are deducted from the gross proceeds of such game.
"The wilful violation of subsections (a), (b), (c) or (d) above shall be a felony and punishable by a fine of not more than one hundred thousand dollars or imprisonment for five years, or both, and any wilful violation of any provision of any local law or ordinance shall constitute and be punishable as a gross misdemeanor."
And finally, the organization conducting the games must come within the restrictive definition of a "bona fide charitable or nonprofit organization" set forth in RCW 9.47.310 (14) as follows:
[[Orig. Op. Page 5]]
"'Bona fide charitable or nonprofit organization' means any organization duly existing under the provisions of chapters 24.12, 24.20 or 24.28 RCW, any agricultural fair authorized under the provisions of chapters 15.76 or 36.37 RCW, or any nonprofit corporation duly existing under the provisions of chapter 24.03 RCW for charitable, benevolent, eleemosynary, educational, civic, patriotic, political, social, fraternal, athletic or agricultural purposes only, which has been organized and is operated primarily for purposes other than the operation of bingo games, raffles, amusement games, and which receives not more than twenty thousand dollars or twenty-five percent of its gross receipts, whichever is the greater, in any calendar year from the operation of bingo, raffles, amusement games, . . ."
The key to your first question is RCW 9.47.390 (c), supra, which states that:
"No bingo game shall be held, operated or conducted if the compensation to any person taking part in the management or operation of such game is based upon a percentage of the receipts or net profits derived from the operation of such game."
In our opinion, this prohibition means that the payment of compensation to the members of the bona fide charitable or nonprofit organization conducting bingo gamesis permitted if such compensation is computed at a fixed hourly or other periodic rate. The express prohibition against only such compensation as is measured by the receipts or profits from the game gives rise, in our judgment, to an implied permission to compensate the members of the organization operating the game on this alternative basis. Accord,Bradley v. Department of Labor and Industries, 52 Wn.2d 780, 329 P.2d 196 (1958), and cases cited therein applying the familiar rule of statutory construction that the express mention of one thing will be taken to imply the exclusion of another thing, expressio unius est exclusio alterius.
Your second question is whether this compensation, although not based upon a percentage of the receipts or profits of the [[Orig. Op. Page 6]] bingo game, can be paid out of the proceeds thereof. This question involves an interpretation of subsection (d) of RCW 9.47.390,supra, which provides that:
"The entire net proceeds of any game of bingo and of any rental therefor shall be exclusively devoted to the lawful purposes of the organization permitted to conduct the same. Net proceeds for the purposes of this subsection shall mean that amount remaining after expenses for supplies, rental, and prizes awarded to participants are deducted from the gross proceeds of such game." (Emphasis supplied)
It will be noted that no mention is made of management or operational expenses in the second sentence of this statute which allows certainother expenses of a bingo operation to be deducted from the gross proceeds of such an operation. Your question thus becomes one of whether payments of an operator's compensation may be made from thenet proceeds of bingo operations under the first sentence as above underscored.
If chapter 280, Laws of 1971, 1st Ex. Sess., as amended, truly authorized (i.e., made "lawful") the conduct of bingo, then an affirmative answer to this question would follow on the ground that the operation of this game in the manner contemplated by the act constitutes a "lawful purpose" of the organization conducting the game. However, the concept of this legislation is not to legalize bingo, which would have been unconstitutional under the oft-cited provisions of Article II, § 24 of our state Constitution which were in effect when it was enacted;3/ rather (as explained above) it is merely to regulate this particular unlawful activity by civil rather than criminal sanctions.
We are aware, of course, that Article II, § 24 has since been amended to make it possible for the legislature (or the people through the initiative process) now to authorize lotteries ‑ and currently reads (in material part) as follows:
[[Orig. Op. Page 7]]
". . . Lotteries shall be prohibited except as specifically authorized upon the affirmative vote of sixty percent of the members of each house of the legislature or, notwithstanding any other provision of this Constitution, by referendum or initiative approved by a sixty percent affirmative vote of the electors voting thereon."
However, this constitutional amendment (SJR No. 5) is not a self-executing grant of such authority ‑ and thus, until such time as bingo is, in fact, specifically authorized in the manner contemplated by the amendment, its status will remain as provided for by the existing legislation which is the subject of this opinion. From this it follows that the operation of bingo games by even those organizations listed in the definition contained in RCW 9.47.310 (11), supra, is still not lawful; instead, it is simply not presently a crime.
For this reason, the use of net proceeds derived from these games to pay compensation to the members operating them would not be consistent with the requirement of RCW 9.47.390 (d), supra, that these proceeds ". . . shall be exclusively devoted to thelawful purposes of the organization . . ." by which the games are conducted, and thus, your second question must be answered in the negative.
Summarizing the foregoing: It is our opinion that a member operating a bingo game under the provisions of RCW 9.47.390 may be compensated for doing so at a fixed hourly or other periodic rate not based upon a percentage of the receipts or net profits derived from the bingo operation. However, any compensation thus paid must come from sources other than either the gross or net receipts of this operation ‑ meaning, of course, that from a practical standpoint the ability of an organization to pay such compensation to its bona fide members for operating its bingo games will be dependent upon the availability of such other sources of income to the particular organization.4/
We trust the foregoing will be of assistance to you.
Very truly yours,
PHILIP H. AUSTIN
Deputy Attorney General
*** FOOTNOTES ***
1/See, also, AGO 1971 No. 21 to State Senator Damon R. Canfield as well as our prior opinion to you of November 24, 1971, on other questions pertaining to this act.
2/See RCW 9.47.400 which provides that:
"The penalties provided for professional gambling in RCW 9.47.320, 9.47.330, 9.47.340, and 9.47.350 (2) and (3), as now or hereafter amended, shall not apply to bingo games, raffles or amusement games when such games are conducted as defined in RCW 9.47.310 (11), (12), (13) and (14), as now or hereafter amended."
3/"The legislature shall never authorize any lottery or grant any divorce."
See, also, AGO 1969 No. 9 [[to Joel M. Pritchard, State Senator on April 30, 1969]]at pp. 27-29, where we concluded that bingo is a lottery ". . . when played for a money or merchandize prize by persons who have paid a valuable consideration to play . . ."
4/See, again, RCW 9.47.310 (14), supra, which (among other things) sets forth specific monetary or percentage limitations upon the gross receipts which the organization can receive from its operation of bingo, raffles and amusement games.