1. Missouri Gaming Commission Charitable Games Division Best Practices Presented by Jane Bax Charitable Games Manager &Rachel Farr Senior Auditor

2. Missouri Constitutional Restrictions Article III, Section 39(a) Only religious, charitable, fraternal, veteran or service organizations with an IRS 501(c) (3), (4), (5), (7), (8), (10), (19), or 501 (d) exemption All net receipts over and above the actual cost of conducting the game as set by law shall be used only for charitable, religious or philanthropic purposes, and no receipts shall be used to compensate in any manner any person who works for or is in any way affiliated with the licensed organization Any person involved in the management, conduct or operation of bingo must be a bona fide member of the licensed organization for the two years immediately preceding such participation, volunteer the time and service necessary to conduct the game, and have never been convicted of any felony

3. Number of Licensees Regular Licensees - 400 Annual license for organization playing a maximum of one day per week on a regularly scheduled day. Special Licensees – 300 Valid for an annual event for a period of 1 to 7 days. Abbreviated Pull-Tab Licensees – 132 Valid for a 24 hour period to play only pull tabs – maximum of 4 licenses per year per organization. Hall Providers - 126 Annual license issued for January through December to entities that rent the hall to bingo organizations. Manufacturers – 10 Annual license issued for January through December to entities that manufacture bingo paper, pull-tabs and/or equipment used in Missouri. Suppliers – 6 Annual license issued for January through December to entities that sell bingo paper, pull-tabs and/or equipment to bingo licensees in Missouri.

4. Charitable Games Division Staff  4 Missouri State Highway Patrolmen Investigations Manufacturer/Supplier Backgrounds  3 Auditors Manufacturers, Suppliers & Bingo Operators  3 Administrative Staff Members Process Bingo Licenses Quarterly Reports Pull-Tab Approvals

5. Taxes Prior to 1995 2 ½ % of the gross receipts realized from bingo Paid by the operator on monthly basis Effective January 1, 1995 Licensed supplier collects taxes from the bingo licensee when product is sold. Taxes paid by the supplier monthly on the last day of the month following the month sold. Supplier may retain 2% for cost of collection Tax Rates –2/10 of one cent per bingo face sold in Missouri –2% of the retail sales value of each pull tab deal

6. Missouri’s Best Practices  New licensee visits Within the first few months of operation Answer any questions regarding regulations Review records to ensure proper records are being kept

7. Missouri’s Best Practices  Issued “No Tolerance” letter on illegal gambling devices  Banned bingo & bingo themes on Missouri riverboats  Offer assistance in setting up viable bookkeeping system  Toll free number to assist licensees  Publish annual Bingo Newsletter  Distribute Bingo Bulletins to keep licensees informed

8. Missouri’s Best Practices  Changed several bingo regulations Permitted sale of bingo paper prior to 10:00am Eliminated 2400 ticket count max on pull-tabs Approved pull-tab packaging in either random or random select Allowed 2 progressive bingo games Approved membership transfers within same organization without 2 year wait Allowed electronic bingo card monitoring devices Paperless system One-way wireless technology

9. Missouri’s Best Practices  Meet with Association of Charitable Games of Missouri (ACGM) Discuss possible legislative or rule changes Communicate licensee requirements  ACGM Mini-Conventions Various locations throughout the state Answer questions Willingness to assist licensees

10. Change In Auditor’s Role  More helpful  Previously, operator audits were unannounced audits conducted during bingo occasions.  Necessary records were not always available  Limited time with organization representatives  Setting appointments with the operators during the day rather than during game.  Ensures necessary records are available  Ensures appropriate representatives are present to ask any questions and receive assistance in areas of concern to them.  Teacher instead of auditor

11. More Audits Conducted More comfortable with the process More compliant with regulations Keeping better records More willing to ask our staff questions FY02FY03FY04*FY05*FY06 AUDITS556385132189 INSPECTIONS232111 14 TOTAL788496143203

12. Bingo On The Decline Suggestions to revitalize bingo or at least slow down the decline?

13. Missouri Gaming Commission Charitable Games Division Best Practices Presented by Jane Bax Charitable Games Manager &Rachel Farr Senior Auditor