Charitable gaming in Alaska to see change

About 1,200 gaming permits issued statewide in 2014
Katrina Mitchell, of the Department of Revenue, speaks to the Juneau Chamber of Commerce at the Hangar Ballroom on Thursday about the changes occuring with gaming permits within Alaska.

Gambling for a good cause is about to get even better.

 

Katrina Mitchell from the Department of Revenue Tax Division spoke at the regular Juneau Chamber of Commerce luncheon Thursday about her first outreach program aimed at educating Alaskan organizations on the changing market of gaming.

Mitchell took the position of gaming manager for the state six months ago and said, even before the recent changes aimed at “going green,” pull-tabs were a whole new world to her.

“Before I took this job, I didn’t even know what charitable gaming was,” she said.

Charitable gaming is a larger industry than people realize. The market is focused on fundraising efforts for non-profit organizations through various forms of gambling.

Bingo, raffles and pull-tabs are some of the most popular methods of gaming, using catchy names like “rodent,” “chicken manure” and “bull moose.”

Not all gaming permits are sold to non-profit organizations. Several pull-tab operations in Juneau run for-profit gambling operations, either in bars or separate facilities.

Mitchell said about 1,200 gaming permits were issued in 2014; 993 of those were for non-profits. The Juneau Chamber of Commerce, which conducts raffles each week, earned about $13,000 from gaming last year.

Of the $256 million in sales last year, about $22 million was actually earned as proceeds after accounting for expenses and winners’ prizes. The state takes 3 percent of profits through sales tax and another 1 percent for user fees. Tax is collected at every stage of the game.

Mitchell said there are many different players in the gaming world. Manufacturers, distributors, operators and vendors are all for-profit entities.

Operators, which run for-profit gaming activities on behalf of nonprofits, are also required to pay out about 30 percent of earnings to the charitable organizations the work with.

Among the audience and Assembly members were representatives of Juneau Ski Club, Rotary, Juneau Archery Club, Juneau Gun Club and many others. Mitchell said in 2014, about 57 non-profits in Juneau were first time or renewed gaming permit holders.

Permits are good for one year, after which an organization must reapply. Participating businesses are also required to file annual status reports on their earned revenue. All of these applications and reports pile up quickly as hard-copy paper packets.

“It generates thousands of pieces of paper,” Mitchell said. “Sorting through them is challenging at best and fairly inefficient.”

She said paper reports are also often illegible and riddled with mathematical errors, which drew a laugh from the audience.

“In a year, this will change substantially,” she said.

Beginning February 2016, all businesses in Alaska will be required to file reports and applications online through a program called Revenue Online. Mitchell said the program is used across the nation for tax preparation and will automatically assist users with calculations and proper preparation.

Mitchell said she expects some hesitancy and confusion with the shift.

“It’s really tough for some people to convert from the paper world to an online environment,” she said.

Some Rotary members, however, advocated a more dramatic shift to the virtual world and away from paper transactions.

Other delegates at the chamber luncheon such as the local ski club were interested in entering the charitable gaming industry and asked about contacting some of the 23 operators in Alaska.

“There’s no limit on how many (organizations) we can issue a license to,” Mitchell said. “As long as they qualify.”

• Contact reporter Stephanie Shor at 523-2279 or at stephanie.shor@juneauempire.com.

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