House Study Bill 22 - Introduced HOUSE FILE _____ BY (PROPOSED COMMITTEE ON STATE GOVERNMENT BILL BY CHAIRPERSON COWNIE) A BILL FOR An Act authorizing and regulating savings promotion raffles, 1 and granting licensing authority to the department of 2 inspections and appeals. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 1610YC (4) 84 aw/nh

H.F. _____ Section 1. Section 99B.1, Code 2011, is amended by adding 1 the following new subsection: 2 NEW SUBSECTION . 14A. “Financial institution” means a state 3 or federally chartered credit union as defined in section 4 533.102 or a state or federally chartered bank as defined in 5 section 524.103, which is located within the state of Iowa. 6 Sec. 2. Section 99B.1, subsection 26, Code 2011, is amended 7 to read as follows: 8 26. “Raffle” means a lottery in which each participant buys 9 a ticket for a chance at a prize with the winner determined by 10 a random method and the winner is not required to be present to 11 win. “Raffle” does not include a slot machine. “Raffle” does 12 not include a savings promotion raffle. 13 Sec. 3. Section 99B.1, Code 2011, is amended by adding the 14 following new subsection: 15 NEW SUBSECTION . 26A. “Savings promotion raffle” means 16 a drawing conducted by a financial institution, or a group 17 of financial institutions, in which a chance of winning a 18 designated prize or prizes is obtained by the deposit of a 19 specified amount of money in a savings account, time deposit, 20 or other savings program offered through that financial 21 institution or group of financial institutions. 22 Sec. 4. Section 99B.7, subsection 1, unnumbered paragraph 23 1, Code 2011, is amended to read as follows: 24 Except as otherwise provided in section 99B.7C or 99B.8 , 25 games of skill, games of chance , and raffles lawfully may be 26 conducted at a specified location meeting the requirements of 27 subsection 2 of this section , but only if all of the following 28 are complied with: 29 Sec. 5. NEW SECTION . 99B.7C Savings promotion raffles. 30 1. For the purposes of this section, a “participant” is a 31 person who is at least eighteen years of age and who has opened 32 a savings promotion raffle account at a financial institution. 33 2. A savings promotion raffle may lawfully be conducted by a 34 financial institution or group of financial institutions if all 35 -1- LSB 1610YC (4) 84 aw/nh 1/ 5

H.F. _____ of the following conditions are met: 1 a. The financial institution conducting the savings 2 promotion raffle has been issued a license from the department 3 and prominently displays that license during raffle drawings. 4 b. The savings promotion raffle conducted includes the 5 distribution of the financial institution’s savings promotion 6 raffle rules to all participants in the savings promotion 7 raffle. 8 c. The savings promotion raffle is open to all participants 9 as provided in the rules established for the savings promotion 10 raffle by the financial institution conducting the savings 11 promotion raffle. Savings promotion raffles shall not be open 12 to members of the public who are not participants pursuant 13 to the savings promotion raffle rules of the financial 14 institution. 15 d. The financial institution offering the savings promotion 16 raffle maintains records regarding its savings promotion raffle 17 and the number of participants. 18 e. The savings promotion raffle is conducted in a fair and 19 honest manner. The financial institution shall not conduct 20 a savings promotion raffle in a manner that jeopardizes the 21 financial institution’s safety and financial soundness or 22 misleads its participants. 23 3. A financial institution shall provide an annual report 24 to the department for each year in which a savings promotion 25 raffle was held. This report shall include the number of 26 savings promotion raffles held during the year, when the 27 savings promotion raffles were held, the description and value 28 of the prize or prizes offered, the names and addresses of 29 participants who won prizes, a copy of the savings promotion 30 raffle rules, and the names and addresses of two witnesses to 31 the raffle drawing. If multiple financial institutions combine 32 efforts for one or more collective savings promotion raffles 33 between participants, they may file a joint annual report. 34 4. A financial institution wishing to conduct one or more 35 -2- LSB 1610YC (4) 84 aw/nh 2/ 5

H.F. _____ savings promotion raffles pursuant to this section shall submit 1 an application and annual license fee of one hundred dollars to 2 the department. The department shall develop an application 3 form requiring the contact information for the financial 4 institution or group of financial institutions conducting the 5 savings promotion raffle and a copy of the savings promotion 6 raffle rules from the financial institution. If multiple 7 financial institutions combine efforts for one or more joint 8 savings promotion raffles between their participants, each 9 financial institution shall complete an application and shall 10 jointly submit the applications and an annual license fee of 11 one hundred dollars. 12 5. Prizes awarded in a savings promotion raffle may be in 13 cash or any other form of property and, subject to the other 14 provisions of this section, shall not be subject to limits on 15 dollar amount, value, or quantity. 16 6. A financial institution or group of financial 17 institutions may compensate employees of the financial 18 institution, or may hire a third-party operator, to conduct a 19 savings promotion raffle. 20 Sec. 6. Section 99B.9, subsection 1, unnumbered paragraph 21 1, Code 2011, is amended to read as follows: 22 Except as otherwise permitted by section 99B.3 , 99B.5 , 23 99B.6 , 99B.7 , 99B.7B , 99B.7C, 99B.8 , 99B.11 , or 99B.12A , 24 it is unlawful to permit gambling on any premises owned, 25 leased, rented, or otherwise occupied by a person other than a 26 government, governmental agency, or governmental subdivision, 27 unless all of the following are complied with: 28 EXPLANATION 29 This bill allows a financial institution or multiple 30 financial institutions to be licensed by the department of 31 inspections and appeals to conduct savings promotions raffles. 32 The bill sets an annual license fee for individual financial 33 institutions and for a joint applicant license at $100. 34 The bill requires that a participant deposit a stated amount 35 -3- LSB 1610YC (4) 84 aw/nh 3/ 5

H.F. _____ of money into specified types of savings accounts in order to 1 participate in the raffle. A savings promotion raffle may 2 only be conducted by a financial institution, which includes 3 state or federally chartered credit unions and banks. The bill 4 provides that a savings promotion raffle is not a raffle which 5 is otherwise regulated by the department. 6 The bill requires that participants in a savings promotion 7 raffle be at least 18 years of age and have opened a savings 8 promotion raffle account with the licensed financial 9 institution. 10 The bill requires a financial institution engaging in a 11 savings promotion raffle to have received a savings promotion 12 raffle license from the department of inspections and 13 appeals, and requires that the institution display the license 14 prominently during the raffle drawing. The bill requires 15 the licensed financial institution to distribute the rules 16 of the raffle to all savings promotion raffle participants, 17 and specifies that savings promotion raffles are not open to 18 members of the public who are not participants as provided in 19 the rules provided by the financial institution. 20 The bill requires that licensed financial institutions 21 conduct the raffles fairly and honestly, not mislead 22 participants, and that the raffles not jeopardize the 23 institution’s financial soundness. The bill also requires 24 that licensed financial institutions maintain records of the 25 raffles and the number of participants, and requires that they 26 provide annual reports to the department. The reports must 27 include the number of raffles held, when the raffles were held, 28 the description and value of all raffle prizes, the names and 29 addresses of winning participants, a copy of the financial 30 institution’s rules, and the names and addresses of two persons 31 who observed the raffle drawing. The bill allows for multiple 32 institutions participating in one raffle to submit a joint 33 annual report. 34 The bill provides that prizes awarded for savings promotions 35 -4- LSB 1610YC (4) 84 aw/nh 4/ 5

H.F. _____ raffles may be in cash or any form of property without limit on 1 dollar amount, value, or quantity. The bill allows financial 2 institutions to compensate employees or hire a third-party to 3 conduct the raffles. 4 -5- LSB 1610YC (4) 84 aw/nh 5/ 5