The state of Michigan classifies raffles as games of chance. As a result, it subjects raffles to strict regulation. Organizations wishing to hold a raffle must have a license to do so. They must first fill out an application and submit it with a small fee to the state's Charitable Gaming Division to receive a raffle license.
Raffle Rules in Michigan State
The Charitable Gaming Division of the Michigan Lottery defines a raffle as "a game of chance where raffle tickets are sold, a winner is determined by randomly drawing a ticket stub from a container, and a prize is awarded." Most drawings require a license.
If an organization would like to hold a raffle, a 50-50 drawing, or a drawing for a door prize, each of these events requires a raffle license. In Michigan, individuals must be at least 18 years of age to buy or sell raffle tickets.
Types of Raffles
In Michigan, if an entity gives something of value for a chance at a prize, it is considered to be a raffle. Skill-based competitions are not raffles. The state has two types of raffles:
- Raffles governed under Michigan's Bingo Act.
- Promotional raffles and game promotions.
Who Can Hold Raffles in Michigan?
Nonprofit organizations qualified by the Charitable Gaming Division are entitled to hold fundraising raffles with an approved Raffle License Application. Every raffle drawing needs a license, but an entity can use just one license for numerous drawing dates at the same location. There is no limit to the number of licenses a qualified organization can hold per year. Silent auctions are not games of chance and so do not require a license.
Organizations that wish to hold a raffle must fill out a Raffle License Application and pay fees:
- Large license: $50 per drawing date.
- Small license: $15 for up to three drawings.
- $5 for each additional date.
Raffle Ticket Requirements in Michigan
Organizations typically use two types of tickets – pre-printed and roll type, or theater style, which can be purchased at office supply stores or online. An entity can only sell roll-type tickets at the location and hours on the license.
Pre-printed tickets are professionally printed and designed. They must contain certain information:
- License number.
- Licensee name.
- Information about the top prizes.
State Requirements for Raffle Prizes
Michigan limits the total value of all prizes. With a small raffle license, the total prize value must not exceed $500. If it exceeds $500, the organization must possess a large raffle license. With donated prizes, the prize value is the retail value had a purchase occurred. If the prize is handmade, they may set what they believe is its value.
An organization may sell roll-type tickets during the time indicated on the gaming license. Organizations can sell tickets after the issuance of the license; it must have all the required content as listed above. Drawings may occur only at the location listed on the license.
Organizations may advertise the event once the issuance of the license occurs, and the license number must appear in any ads.
Michelle Nati is an associate editor and writer who has reported on legal, criminal and government news for PasadenaNow.com and Complex Media. She holds a B.A. in Communications and English from Niagara University.