Summary
SB-1044 will adjust the flat $2,000 per month overhead cap for charitable bingo games to instead be tied to the California Consumer Price Index (CPI).
Background
The California Constitution allows the Legislature to let cities and counties host bingo games for charity. All earnings must be deposited into a dedicated fund, separate from any other financial resources. While these organizations are allowed to allocate funds for equipment rentals or purchases, the current law requires that administrative costs cannot exceed either 20% of the prize money or $2,000 per month, whichever is less.
The bingo law has not been amended since its passage in 2013. While the $2,000 limit might have been adequate then, our current economy makes it more difficult for communities to operate bingo games for fundraising. For instance, the current financial limit jeopardizes operations of a weekly charity bingo game which raises $2,800 per game and donates $130,000 annually to community services. Rent alone costs $2,000 per month, and with significant administrative costs like paper, janitorial services, security, insurance, and electricity, which can add up to $2,230 every month, it's undeniable that the costs have escalated. This is reflected in the California Consumer Price Index (CPI), which shows that $2,000 in February of 2013 is the equivalent of $2,778 in October of 2023.
To mitigate financial issues for charity bingo organizers, limits on costs should be tied to CPI instead of a flat cap. Current law automatically adjusts a variety of value limits annually for inflation, including the adjustment of our emergency structure value limits. Linking bingo costs to the CPI, ensures the sustainability of these games amid changing economic conditions, and preserves their significant contribution to charitable causes while balancing the purpose and intent of the original law.
Proposal
SB-1044 will link the $2,000 overhead cost limit for charitable bingo games to the Consumer Price Index (CPI), an automatic adjustment that is efficient and predictable.