Senate committee approves charity raffles
NASHVILLE (AP) — After four hours of debate, a Senate committee on Tuesday approved legislation that would allow charities to begin holding gambling fund-raisers in Tennessee.
The 8-3 vote by the Senate Finance Committee sent the bill to the full chamber for debate Wednesday, said sponsor Jim Kyle, who also serves as vice chairman of the committee.
The legislation and its two companion bills are on a fast track through the General Assembly as Kyle, D-Memphis, and House sponsor Harry Tindell, D-Knoxville, work to pass them in time for charities to complete the application process before the Legislature adjourns. Otherwise, charity events could not be held until next year, since the Legislature has to approve the applications.
State officials estimate that about 150 of the state’s 16,000 charities will apply to hold fund-raising events this year, with that number rising to approximately 1,700 by 2005. Among them are the Boys and Girls Clubs of Knoxville, which held an annual rubber duck race fund-raiser on the Tennessee River until 1997, when the event was declared unconstitutional.
The ghosts of Tennessee’s gambling past — and objections from several lawmakers and Secretary of State Riley Darnell, whose office would be charged with oversight of the charities — almost derailed the bill’s progress as opponents questioned everything from the purpose of the bill to how it would be implemented.
Darnell, in an unsuccessful amendment presented to the committee, complained that Kyle’s bill doesn’t require a certain percentage of the proceeds to go to the charity. He also said the fund-raisers could be “easily controlled by criminals” because the bill doesn’t mandate criminal history checks of those conducting them.
Lack of “inventory controls” over the printing of game tickets also worried Darnell, who said the problem is “not only what they did with the money they said they raised, but being able to find out how much they actually raised. It’s all about having an audit trail.”
After lengthy debate, Sen. Roy Herron, D-Dresden, moved for a vote on Darnell’s plan, but it wasn’t seconded by another member — meaning it died in committee.
Herron and Sen. David Fowler, R-Signal Mountain, both expressed concern that a scandal akin to the “Rocky Top” federal and state investigation of the mid-1980s might emerge without more stringent safeguards than those detailed in Kyle’s bill.
In Rocky Top, investigators found bingo operators who used state charters for legitimate Tennessee charities to run gambling operations. It led to several indictments and suicides by two public officials, including the secretary of state at the time, Gentry Crowell.
As a result of the Rocky Top scandal, the state Supreme Court ruled in 1989 that bingos and raffles were unconstitutional — citing the prohibition against lotteries.
When voters approved a constitutional amendment allowing a state lottery in 2002, they authorized the Legislature to again let charitable organizations have annual lottery-type fund-raising events.
“I was on Capitol Hill when Rocky Top erupted, when people went to jail, when people killed themselves, when the corruption tainted all of us in government,” Herron said. “Those who do not remember the past are condemned to repeat it, and I’m afraid that’s where we may well be again.”
Fowler did succeed in adding several amendments to the bill, including one that would prohibit anyone from selling fund-raiser tickets for profit. Another would require the name of the organization holding the event to be printed on raffle tickets, while a third calls for “audited financial statements” from any organization that brings in more than $30,000 in an event.
Both Herron and Fowler, along with committee chairman Douglas Henry, D-Nashville, ultimately voted against the legislation.
But despite the objections of his colleagues, Kyle said his bill is stringent enough.
“I respect them and their position. They’re just adamantly opposed to this,” he said. “But I’ll be honest with you, the people of Tennessee spoke on this issue, they would like to let these charities do this. … I think people are comfortable with the concept of the bill.”
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Tennessee General Assembly: www.legislature.state.tn.us