The Charitable Raffle Enabling Act (“CREA”), permits "qualified organizations" to hold up to four raffles per calendar year, with certain specified restrictions.

The Professional Sports Team Charitable Foundation Raffle Enabling Act permits “professional sports team charitable foundations” to hold raffles during home games, with certain specified restrictions.

The language of the law is very technical, and the two types of raffles have different rules and regulations. If your organization is considering holding a raffle, you should check the statutes to be sure that your raffle qualifies.

Penalties and Enforcement

An unauthorized raffle is considered gambling under the Texas Penal Code, carrying criminal penalties.

A county attorney, district attorney or the Office of the Attorney General (OAG) may bring an action in state court to stop a violation or potential violation of the Charitable Raffle Enabling Act (CREA) or the Professional Sports Team Charitable Foundation Raffle Enabling Act.

Recent Changes to the Laws

HB 2757, effective June 15, 2021, amended the Charitable Raffle Enabling Act to increase the allowable value of each purchased prize from $50,000 to $75,000 and the allowable number of raffles that may be held per calendar year from two to four.

HB 2168, effective June 8, 2021, amended the Professional Sports Team Charitable Foundation Raffle Enabling Act to remove the criminal penalty for a person accepting a form of payment other than U.S. currency or a debit card for the purchase of a raffle ticket.

HB 3012, effective December 1, 2021, amended the Professional Sports Team Charitable Foundation Raffle Enabling Act to allow qualified foundations associated with organizations sanctioned by the Professional Rodeo Cowboys Association or the Women’s Professional Rodeo Association to conduct raffles at rodeo events.

Frequently Asked Questions

What is a raffle?

CREA defines a raffle as "the award of one or more prizes by chance at a single occasion among a single pool or group of persons who have paid or promised a thing of value for a ticket that represents a chance to win a prize."

The Professional Sports Team Charitable Foundation Raffle Enabling Act adopts the same definition as CREA.

Who may conduct raffles?

Under CREA, only a qualified religious society that has been in existence in Texas for at least 10 years; a qualified volunteer fire department that operates firefighting equipment, provides fire-fighting services and that does not pay its members other than nominal compensation; a qualified volunteer emergency medical service that does not pay its members other than nominal compensation; or a qualified 501(c) tax-exempt, nonprofit organization that has been in existence for at least three years may hold raffles in Texas. Individuals and for-profit businesses may not hold raffles.

Under the Professional Sports Team Charitable Foundation Raffle Enabling Act, only a qualified “professional sports team charitable foundation” may conduct a raffle.  To qualify, a foundation must be associated with a “professional sports team,” as defined in the statute, with a home venue or rodeo venue located in this state, and it must be a 501(c)(3) tax-exempt, nonprofit organization that has been in existence for at least three years.

Do I have to register or obtain a permit to conduct a raffle?

No. You just have to qualify under the law.

How many raffles may be held?

Under CREA, each qualified organization is allowed four raffles per calendar year.

Under the Professional Sports Team Charitable Foundation Raffle Enabling Act, a qualified professional sports team charitable foundation may conduct a raffle during each preseason, regular season, and postseason game hosted at the home venue or each rodeo event at the rodeo venue of the professional sports team associated with the foundation.

What if a raffle cannot be held on the date scheduled?

Under CREA, the organization may set another date not later than 30 days from the original date. If the prizes are not awarded within 30 days of the original date, the organization must refund the ticket money to the purchasers.

The Professional Sports Team Charitable Foundation Raffle Enabling Act is silent on this issue.

For what may the money raised be used?

Under CREA, all proceeds from raffles must be used for the charitable purposes of the organization as defined by CREA 2002.002(1).

Under the Professional Sports Team Charitable Foundation Raffle Enabling Act, all proceeds less the amounts deducted for reasonable operating expenses, as defined in the statute, and cash prizes must be used for the charitable purposes of the professional sports team foundation.  The amount deducted as reasonable operating expenses may not exceed 10% of the gross proceeds.

Can I advertise and sell tickets on the Internet?

CREA states that the organization may not promote or advertise a raffle statewide, other than on the organization’s website or through a publication or solicitation, including a newsletter, social media, or email, provided only to previously identified supporters of the organization. Selling or offering to sell tickets statewide is prohibited. The term statewide has not been defined or interpreted in any known court proceeding or Attorney General Opinion, but it is generally thought that statewide would include the Internet.

The Professional Sports Team Charitable Foundation Raffle Enabling Act is silent on this issue.

May I hire someone to organize and conduct the raffle?

Under CREA, the organization may not compensate a person directly or indirectly for organizing or conducting a raffle. A member of the organization who is employed by the organization may organize and conduct a raffle, but the member’s work organizing or conducting a raffle may not be more than a de minimis portion of the member’s employment with the organization.

Under the Professional Sports Team Charitable Foundation Raffle Enabling Act, only employees or volunteers of the professional sports team charitable foundation or the professional sports team associated with the foundation may sell raffle tickets.

What must be printed on the tickets?

Under CREA, the following five items must be on each ticket:

-The name of the organization conducting the raffle

-The address of the organization or of a named officer of the organization

-The ticket price

-A general description of each prize having a value of more than $10 to be awarded in the raffle

-The date on which the raffle prize or prizes will be awarded

Under the Professional Sports Team Charitable Foundation Raffle Enabling Act, the following five items must be on each ticket:

-The name of the raffle and the sales station at which the ticket was purchased

-The date of the drawing and the manner in which the winning ticket will be announced

-The procedure and location for claiming a prize

-The time allowed for a prize winner to claim a prize

-The logo of the professional sports team foundation, the logo of the professional sports team associated with the foundation, or both

Can I give cash prizes?

Under CREA, cash prizes are strictly prohibited. "Money" is defined by CREA as "coins, paper currency, or a negotiable instrument that represents and is readily convertible to coins or paper currency." See 2002.002(1-a).  A certificate of deposit is a prohibited prize.  A U.S. savings bond and a prepaid, or “stored value,” credit card is not prohibited.

Under the Professional Sports Team Charitable Foundation Raffle Enabling Act, cash prizes are allowed.

Is there a limit on the value of prizes?

Under CREA, for purchased prizes, the value of each prize may not exceed $75,000. For a purchased residential dwelling, the value may not exceed $250,000. There is no limit on the value of donated prizes.

Under the Professional Sports Team Charitable Foundation Raffle Enabling Act, the cash prize may not exceed 50% of the gross proceeds collected from the sale of raffle tickets.

Do I need to have the prize on hand at the time of the drawing?

CREA states that the organization must have the prize in its possession or ownership or it must post a bond with the county clerk of the county in which the raffle is to be held for the full amount of the money value of the prize.

The Professional Sports Team Charitable Foundation Raffle Enabling Act is silent on this issue.

How do I post a bond with the county clerk?

CREA is not specific on what type of bond is to be filed in this circumstance.  However, we anticipate that county clerks will expect a surety bond.  Refer the clerk's office to CREA 2002.056(d)(2).

Poker/Casino Nights

Can my nonprofit hold a poker tournament or casino night fundraiser?

Unlike raffles and bingo, there is NO exception to the gambling law in Texas for nonprofits to hold poker or casino night fundraising events. The gambling law, Chapter 47 of the Penal Code, applies to nonprofits and to for-profits equally.  See Tex. Pen. Code Ann. §47 (Vernon 2003).

What if the poker tournament or casino night is held in a private place?

Under certain statutory conditions, it is legal for individuals to play poker or other casino activities in a private place, defined as "a place to which the public does not have access." They can bet money and win money. However, all money must be redistributed to the participants. The host organization or individual cannot keep any portion of the proceeds that are bet and won in these private poker or casino nights.