Bill Allowing Remote Operation Of Raffles Hits Roadblock — But It’s Just Temporary

When a governor announces a “conditional veto” of a bill sent from the legislature to their desk, it’s easy to see “veto” and think the bill is in trouble.

But in fact, the action very often could just as easily be called a “conditional approval.”

So New Jersey Gov. Phil Murphy’s rejection of a bill on Monday that would take a law that permits “eligible organizations to conduct in-person raffles at large sporting venues” and expand it “to allow the remote operation of these large sporting venue raffles,” just means it needs a few tweaks.

In the veto, Murphy hardly comes across as a diehard opponent of this “lite” version of gambling, writing, “I commend the bill’s sponsors for their recognition of a more subtle aspect of the coronavirus pandemic, and their efforts to support and restore the viability of the charitable fundraising conduit provided through raffles held during events at large sporting venues.

“I am concerned, however, that the legislation may be too broad in its approach, and would benefit from some additional safeguards to ensure the fairness and integrity of the offerings.”

The devil’s in the details

Murphy went on to explain the bill‘s purpose in more detail:

“Specifically, the bill would authorize the use of the Internet or other electronic means to conduct the raffle and for the sale and purchase of tickets. Similar to the Internet casino wagering law, the bill provides that the raffle will be deemed to take place at the large sporting venue, regardless of a participant’s physical location within this State, subject to the limitation that tickets may be sold only to persons physically located in the State.

“Although the large sporting venue raffle law has been in place for only two years, it has enabled charitable organizations affiliated with professional and collegiate sports teams competing in events held at large sporting venues to raise much-needed funding for their charitable foundations and partners, support their good works, and promote awareness of important social causes. Unfortunately, as with most aspects of our lives, the coronavirus pandemic has had an adverse impact on these worthy endeavors, as social distancing and necessary health precautions have led to the cancellation of events in large sporting venues, or otherwise limited the numbers of attendees in a way that has made this avenue for charitable solicitation and contribution untenable.

“It is certainly reasonable and appropriate, in response to a public health emergency which has prevented fans from participating in charitable raffles at the stadium as they root on their hometown teams, to allow these game-day raffles to be conducted through the Internet or other electronic means. This expansion will enable ticketholders who would otherwise be in attendance at the event, and other loyal team followers, to show their generosity and support for the worthy charitable causes promoted at the venue by the participating organizations.”

And here’s the catch

Murphy continued: “However, the bill does not limit the remote conduct of raffles to just during the public health emergency, and I do not see the rationale for extending indefinitely this expanded authorization, once the public health emergency has passed and stadiums are again filled with fans. Accordingly, I propose amendments to specify that raffles at a large sporting venue may be conducted remotely while the Public Health Emergency … is in effect or whenever a declared Public Health Emergency is in effect.

“Additionally, even this more limited, temporary expansion implicates a novel regulatory challenge for the Legalized Games of Chance Control Commission, which is charged with regulating games of chance such as raffles, bingo, and the like. None of the games of chance currently regulated by the Commission are offered on this scale or employ this type of technology, so changes to the bill are needed in order to help the Commission meet this new challenge. My recommended revisions will ensure, to the greatest extent possible, the fairness, integrity, and security of the remote conduct of the raffle and related ticket sales online. These proposed changes include the express requirement that the Commission approve the measures, procedures, and controls being used by an organization to implement the remote conduct of the raffle, including the use of geolocation technology to ensure that participants are located in the State, as well as the requirement that winning participants claim their prizes in person at the stadium or at the organization’s headquarters or facilities, to ensure that necessary verifications take place.

“My recommendations also propose informational disclosures to consumers, and authorize the Commission to consult with the Division of Gaming Enforcement, which has developed advanced technical expertise in reviewing the types of Internet technology that will be used to conduct raffles remotely, to facilitate the Commission’s ability to expeditiously review the proposed methods and safeguards for the remote conduct of such raffles.”

Murphy even recommended 25 specific suggested amendments, many of which change only a word or two, and none of which likely will be seen as onerous to the bill’s sponsors.

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