Charity Bingo in Trouble in Texas

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When most people think of bingo, they associate the game with churches and charities. Since the early 1930's, bingo has been used by the Catholic Church to raise money for various parish expenses. In the late 1940's, other charities and veteran's groups adopted bingo as a fundraising tool. Every year, bingo raised hundreds of millions for charities in the United States and Canada. In Texas, bingo is a big business, and generates about $700 million annually - incorporating even a few small bingo news outlets. Bingo is legal in Texas because a significant percentage of the money is supposed to go to charities. In San Antonio, a local reporter, Mireya Villarreal, uncovered information that revealed that very little of the revenues generated by bingo halls actually make it to the nonprofit charities. Villarreal also said that there is almost no oversight by the state, which is largely responsible for the problem.

Percy Spence is the commander of a local Disabled American Veterans chapter. Spence said that two years ago, his organization signed a contract with a local bingo hall hoping to make big bucks. During that time, the charity almost went bankrupt. Spence said that he questioned his leadership skills, and told reporters "Very embarrassing, first of all. Lot of tears at night. How did I let this happen?" After 11 months, Spence's organization had to stop their bingo operation and give up their bingo license. Spence said "You can get in debt real quick. And this is the lottery commission, and they know you're out there to make money. But if the commanders or the people in charge of these 501(c)(3)'s are not smart with the business, it can bankrupt you right quick."

Spence said that he knew that the bingo hall his organization was working with made hundreds of thousands of dollars off their bingo games, but when his organization got their cut, it was barely enough to cover expenses. Unfortunately, Spence's story is not uncommon. Villarreal uncovered some astounding statistics. After reviewing state records Villarreal found that in 2010 bingo generated about $700 million. After prizes salaries and fees were paid charities in Texas were given less than $34 million which amounts to less than 5%. Villarreal cited the case of one bingo hall that made $7.5 million in 2011 and five nonprofits only received a total of $462,000 or 6%.

Part of the problem is that the state's Charitable Bingo Division had its funding cut and the directors claim they do not have the manpower to audit and inspect bingo halls and their records. State Representative Jose Menendez is a member of a committee that oversees the Texas Lottery Commission and charity bingo. State Representative Jose Menendez told Villarreal "It appears their expenses are so high that the charities are getting a pittance. I would say it's a very small, nominal percentage of what the operations are bringing in on an annual basis." Hopefully the state will take some action to make sure charities are getting their fair share of bingo game revenues.

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