§ 5B.6. Operational requirements

Any remote caller bingo game operated pursuant to this chapter shall comply with all of the following:

(a) An authorized organization shall conduct remote caller bingo games only on property owned or leased by it, or property where use is donated to the authorized organization. The property does not need to be used exclusively by, or donated exclusively to, the authorized organization.

(b) A remote caller bingo game shall not include any site that is not located within California. In addition, a location shall not be eligible to participate in a remote caller bingo game if bingo games are conducted at that location in violation of Chapter 5A, Penal Code Section 326.5 or any regulation adopted by the commission pursuant to Business and Professions Code Section 19841, including, but not limited to, a location at which unlawful electronic devices are used.

(c) All remote caller bingo games shall be open to the public and shall not be limited to just the members of the authorized organization.

(d) No minors shall be allowed to participate in any remote caller bingo game.

(e) No person shall be allowed to participate in a remote caller bingo game unless the person is physically present at the time and place where the remote caller bingo game is being conducted. A person shall be deemed to be physically present at the place where the remote caller bingo game is being conducted if he or she is present at any of the locations participating in the remote caller bingo game in accordance with this chapter and Penal Code Section 326.3.

(f) No more than seven hundred fifty players may participate in a remote caller bingo game in a single location. However, if the Governor of California or the President of the United States declares a state of emergency in response to a natural disaster or other public catastrophe occurring in California, an authorized organization may, while that declaration is in effect, conduct a remote caller bingo game with more than seven hundred fifty participants in a single venue if the net proceeds of the game, after deduction of prizes and overhead expenses, are donated to or expended exclusively for the relief of the victims of the disaster or catastrophe, and the authorized organization gives the commission at least ten days' written notice of the intent to conduct that game.

(g) An authorized organization shall not conduct remote caller bingo more than two days per week.

(h) The value of prizes awarded during the conduct of any remote caller bingo game shall not exceed thirty-seven percent of the gross receipts for that game. When an authorized organization elects to deduct fees paid for the use and processing of credit card sales from the amount of gross revenues for that game awarded for prizes, the maximum amount of gross revenues that may be awarded for prizes shall not exceed thirty-seven percent of the gross receipts for that game, less the amount of redirected fees paid for the use and processing of credit card sales. Every remote caller bingo game shall be played until a winner is declared. Progressive prizes are prohibited. The declared winner of a remote caller bingo game shall provide his or her identifying information and a mailing address to the onsite manager of the remote caller bingo game. Prizes shall be paid only by check; no cash prizes shall be paid. The authorized organization may issue a check to the winner at the time of the game, or may send a check to the declared winner by United States Postal Service certified mail, return receipt requested. All prize money exceeding state and federal exemption limits on prize money shall be subject to income tax reporting and withholding requirements under applicable state and federal laws and regulations and those reports and withholding shall be forwarded, within ten business days, to the appropriate state or federal agency on behalf of the winner. A report shall accompany the amount withheld identifying the person on whose behalf the money is being sent. Any game interrupted by a transmission failure, electrical outage, or act of God shall be considered void in the location that was affected. A refund for a canceled game or games shall be provided to the purchasers.

(i) A remote caller bingo game shall be operated and staffed only by members of the authorized organization that organized it. Those members shall not receive a profit, wage, or salary from any remote caller bingo game. Only the authorized organization shall operate the remote caller bingo game, or participate in the promotion, supervision, or any other phase of a remote caller bingo game, provided that this shall not preclude the authorized organization from employing administrative, managerial, technical, financial, or security personnel who are not members of the authorized organization as provided in subsection (j). These personnel may be paid reasonable fees for such services from remote caller bingo revenue, provided that the fees shall not be determined as a percentage of receipts or other revenues from, or be dependent on the outcome of, the game.

(j) No individual, corporation, partnership, or other legal entity, except the authorized organization authorized, shall hold a legally cognizable financial interest in the conduct of a remote caller bingo game. Notwithstanding any other provisions of law, exclusive or other agreements between the authorized organization and other entities or persons to provide services in the administration, management, or conduct of the game shall not be considered a violation of the prohibition against holding a legally cognizable financial interest in the conduct of the remote caller bingo game by persons or entities other than the authorized organization, or other entity authorized to conduct the remote caller bingo games, provided that those persons or entities obtain the gambling licenses, the key employee licenses, or the work permits required by, and otherwise comply with Chapter 5 of Division 8 of the Business and Professions Code. Fees to be paid under any such agreements shall be reasonable and shall not be determined as a percentage of receipts or other revenues from, or be dependent on the outcome of, the game.

(k) An authorized organization shall not have overhead costs exceeding twenty percent of gross sales, except that the limitations of this subsection shall not apply to one-time, nonrecurring capital acquisitions. For purposes of this subsection, "overhead costs" includes, but is not limited to, amounts paid for rent and equipment leasing and the reasonable fees authorized to be paid to administrative, managerial, technical, financial, and security personnel employed by the authorized organization pursuant to subsection (j). For the purpose of keeping its overhead costs below twenty percent of gross sales, an authorized organization may elect to deduct all or a portion of the fees paid to financial institutions for the use and processing of credit card sales from the amount of gross revenues awarded for prizes. In that case, the redirected fees for the use and processing of credit card sales shall not be included in "overhead costs." Additionally, fees paid to financial institutions for the use and processing of credit card sales shall not be deducted from the proceeds retained by the authorized organization.

(l) An authorized organization shall designate a person as having fiduciary responsibility for the remote caller bingo game.

(m) Any person or entity who conducts the remote caller bingo game, including, but not limited to, all administrative, managerial, technical, financial, and security personnel employed by an authorized organization, shall possess and maintain all applicable approvals, permits and licenses from the commission.

(n) An authorized organization shall not cosponsor a remote caller bingo game with one or more other organizations unless one of the below is true. A maximum of ten unaffiliated organizations may enter into an agreement to cosponsor a remote caller game, provided the game shall have not more than ten locations. Before sponsoring or operating any game authorized under paragraph (1) or (2), each of the cosponsoring organizations shall have entered into a written agreement, a copy of which shall be provided to the commission, setting forth how the expenses and proceeds of the game are to be allocated among the participating organizations, the bank accounts into which all receipts are to be deposited and from which all prizes are to be paid, and how game records are to be maintained and subjected to annual audit.

(1) All of the cosponsors are affiliated under the master charter or articles and bylaws of a single organization.

(2) All of the cosponsors are affiliated through an organization as defined in this chapter and have the same Internal Revenue Service activity code.

(o) All remote caller bingo games and operations shall comply with all applicable state law and regulations, including, but limited to, Penal Code Sections 326.3 and 326.5 and any regulations adopted by the commission to implement those sections. To the extent of any inconsistency or conflict between the provisions of Penal Code Section 326.5 and any state regulations adopted to implement Section 326.5 and the provisions of Penal Code Section 326.3 and any regulations adopted to implement Section 326.3, the provisions of Penal Code Section 326.3 and its implementing regulations shall control.

(Ord. No. 1535, § 4(Exh. B), 11-1-2011)