Charity-poker option not without its risks

It should come as a surprise to no one that charity-poker games have emerged in recent years as an intriguing option for charities that are constantly on the lookout for new ways to raise money for their cherished causes.

The popularity of Texas Hold 'em – including the high-stakes tournaments readily available for viewing on cable TV – has given charitable organizations another tool besides bingo, raffles and auctions when it comes time to put together their annual fundraising plan.

In the past few months, Nashua, Brookline and now Milford have been on the receiving end of proposals from New Hampshire Charitable Gaming LLC of Rye to operate poker halls in their communities to benefit charitable organizations – with mixed success:

• Earlier this year, the Nashua Zoning Board of Adjustment voted 2-2 to reject a proposal from the organization to run poker games at the site of the former St. Stanislaus Hall on Pine Hill Road.

That prompted several aldermen to file legislation intended to make it more difficult for these so-called gambling parlors to get a foothold in the downtown area. Those proposals are still under consideration.

–n Two weeks ago, the Brookline Planning Board voted to allow the Big Bear Lodge to lease space to the organization so it can operate poker games for charity from 11 a.m. and 1 a.m.

• And tonight, the Milford Planning Board will conduct a public hearing to consider a proposal from the organization to use 12,000 square feet of space in the former Violette's IGA at the Granite Town Plaza for a 250-seat Texas Hold 'em poker operation.

Last year, the Legislature approved legislation that allows charities to hire professional companies to operate these kinds of activities in return for at least 35 percent of the profits. In return, the outside firm is required to put up a $20,000 performance bond to ensure that funds are available to reimburse charities should they be unable to meet their obligations.

As you may recall, that's exactly what happened earlier this year when New England Fund Raising Co. Inc. of Nashua shut down its operation, leaving 13 charitable organizations on the short end of between $60,000 and $90,000 in anticipated profits.

The attorney general's office is conducting a criminal investigation into what happened with those funds, and the Executive Council agreed last month to distribute the $20,000 in bond money among the organizations.

And therein lies a cautionary tale for any charitable organization that believes there is easy money to be made by simply turning over their fundraising programs to professional firms running poker games. While we certainly understand the need for charities to seek new and improved ways of raising money for the many causes they hold dear, it is imperative that they become experts on the state laws and regulations that govern these types of operations.

Perhaps chief among them is the requirement that the sponsoring organization's treasurer be onsite to handle all the finances relationships – a procedure that wasn't followed by any of the 13 nonprofit organizations that got burned in the New England Fund Raising case.

Charitable organizations considering entering these kind of relationships – be it poker or other games of chance – also need to keep in mind they are putting their good names on the line.

Given that people tend to donate to charities only when they are confident their money is going to make a difference, any loss in that confidence could have a detrimental effect on the organization for a long, long time.

News Added: 18 September, 2007

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