Pennsylvania law allows raffles only for fundraising by nonprofit organizations for the purposes of charitable or public interests. The organization must have a permit if the raffle is to have an individual prize of more than $500 in value or total prizes in excess of $5,000 within a month. A majority of the voters in a municipality can vote not to issue any such permits.
Meet eligibility requirements. There are three criteria that must be met before an organization is eligible to hold a legal raffle in Pennsylvania. The organization must be not-for-profit. Furthermore, it must be a charitable, religious, fraternal or veterans organization, or a civic and service association. Finally, the organization must have been in existence and fulfilling one of the prerequisite purposes for at least one year prior to applying for a raffle permit.
Apply for a permit, if necessary. If your raffle will award a single prize over $500 or prizes totaling more than $5,000 in value in a month, you must apply to the municipality for a special raffle permit no less than 30 days prior to the date on which tickets will begin being sold. The application must state the date and location of the drawing, the number of chances to be sold, their price, the value of the prizes and the date that sales of chances will begin.
Do not advertise prizes except to members. Pennsylvania law prohibits advertisement of a raffle's prizes or their cash value except in publications circulated among the membership of an eligible organization. The actual tickets to the raffle are permitted to state the nature of the prize.
Get a member to volunteer. The raffle must be conducted by a bonafide member of the organization, who is not allowed to be compensated for their service.
Except for volunteer fire, ambulance and rescue organizations, who can have three raffle permits in a year, an eligible organization can only receive two raffle permits in a calendar year. Your organization can avoid needing a permit by staying under the prize value restrictions of $500 per prize and $5,000 per month.
All participation in the raffle must be on a cash basis. There can be no extension of credit for participation in the raffle.
Joseph Nicholson is an independent analyst whose publishing achievements include a cover feature for "Futures Magazine" and a recurring column in the monthly newsletter of a private mint. He received a Bachelor of Arts in English from the University of Florida and is currently attending law school in San Francisco.