Can a 501(c)(3) nonprofit give away college football tickets as door prizes at a fundraiser without breaking Arkansas gambling law?
Plain-English summary
Sonia Fonticiella, the prosecuting attorney for the Second Judicial District, asked the AG whether a 501(c)(3) nonprofit could legally give away college football tickets as door prizes at a fundraising event. The answer turns on what attendees pay for.
Arkansas generally prohibits "gambling," which the state Supreme Court defines as "the risking of money between two or more persons, on a contest or chance of any kind, where one must be loser and the other gainer." There are narrow exceptions: bingo and raffles run by qualified nonprofits under the Charitable Bingo and Raffles Enabling Act, the state-run Scholarship Lottery, and casino games at licensed casinos.
If event attendees pay to come to the event but don't pay anything specifically for a chance to win the football tickets, the prize giveaway isn't gambling. There's no "risking of money" on the chance to win, just a ticketed event with a free drawing inside. Same answer if attendees pay nothing at all.
If attendees pay something extra (above the cost of admission) for a chance at the prize, that's risking money on chance and qualifies as gambling. To be lawful, the activity has to fit within an authorized exception. A door-prize scheme that takes money for entries fits the "raffle" exception only if the nonprofit qualifies as an "authorized organization": it has to be a tax-exempt nonprofit that has been continuously in existence in Arkansas as a nonprofit for at least five years before conducting the raffle, and it must use the net receipts only for charitable, religious, or philanthropic purposes.
The opinion declines to apply this to specific facts because Ms. Fonticiella didn't provide them. The framework is what each event organizer should run their plan against.
What this means for you
If you run or volunteer for a 501(c)(3) charity in Arkansas
Before your fundraiser, decide whether attendees pay specifically for a chance at the prize. If yes, you need to qualify under the Charitable Bingo and Raffles Enabling Act. If no, you have more flexibility.
The cleanest design that avoids gambling-law issues entirely: charge a flat ticket price for the event, give every attendee a free door-prize entry at the door, draw at the end of the night. Don't sell separate raffle tickets, don't offer "extra entries for a donation," and don't tier the entry chances by ticket price. If anyone is paying anything specifically tied to a chance at the prize, you're in raffle territory.
If you do want to sell raffle tickets (which is often the more lucrative model), confirm in writing that your organization meets the "authorized organization" definition: a tax-exempt nonprofit, in continuous existence in Arkansas for at least five years before the raffle, and the net receipts go to charitable, religious, or philanthropic purposes. Get a license from the appropriate authority and follow the statutory rules.
If you are a prosecuting attorney or local enforcement authority
Use this framework when evaluating complaints about charity fundraisers. The key factual questions are: did anyone pay anything for a chance to win the prize? If yes, does the organization qualify as an "authorized organization" under Amendment 84 and Title 23, Chapter 114? If yes, are the procedural steps for raffles being followed? Misclassified door-prize schemes are common; they often look harmless but can technically be unlicensed lotteries.
If you are a board member of a smaller nonprofit (under 5 years old)
You don't qualify for the raffle exception until your organization has been continuously in existence as a tax-exempt nonprofit in Arkansas for at least five years. That's a hard requirement. Until then, you can do free-entry door prizes at ticketed events, but you cannot legally sell raffle tickets or charge for separate raffle entries.
If you are a sponsor providing a donated prize
Confirm with the recipient organization that they qualify as an authorized raffles organization (if it's a paid-entry event) or that they're using a free-entry model. If the event isn't structured legally, you may end up tied to an unlicensed lottery scheme.
Common questions
Q: What is "gambling" in Arkansas?
A: The Arkansas Supreme Court has defined it as "the risking of money between two or more persons, on a contest or chance of any kind, where one must be loser and the other gainer" (Sharp v. State, quoting Portis v. State, 1872). The court uses "gambling" and "gaming" interchangeably.
Q: What's a "lottery" in Arkansas?
A: A scheme with three elements: (1) consideration paid (directly or indirectly) to participate, (2) winner is determined by chance (not skill or judgment), and (3) a prize is awarded. The only authorized state-level lottery is the Scholarship Lottery.
Q: What's a "raffle"?
A: Selling a ticket "to win a prize awarded through a random drawing" (Ark. Const. amend. 84, § 1; A.C.A. § 23-114-102(16)(A)). Excludes machine or electronic games.
Q: Who can run a raffle in Arkansas?
A: Only an "authorized organization." That means a nonprofit tax-exempt organization that has been continuously in existence in Arkansas as a nonprofit tax-exempt organization for at least five years immediately before the raffle.
Q: What if you give away a prize but no one pays anything?
A: Then it's not gambling. There's no "risking of money," so no contest of chance under Arkansas's gambling definition.
Q: What if attendees pay an entry fee to attend the event but the prize is free?
A: Still not gambling. The AG explains that attendees are paying to attend the event, not specifically risking money on a chance to win the prize.
Q: What about adding "you can buy extra raffle tickets"?
A: Now it's gambling, because attendees are paying additional money specifically for a chance to win. To be lawful, your organization must qualify under the Charitable Bingo and Raffles Enabling Act.
Q: Does this opinion say a particular nonprofit can or can't do it?
A: No. The AG declined to apply the rule to specific facts because Ms. Fonticiella didn't provide them. The opinion lays out the legal framework. Each event must be evaluated on its own facts.
Background and statutory framework
Arkansas law starts from a general prohibition on gambling. Article 19, Section 14 of the state constitution and corresponding statutes treat lotteries as a form of gambling that is generally barred. The state has carved out narrow exceptions.
Amendment 87 (1996) authorized the Arkansas Scholarship Lottery, the only state-level lottery. The Scholarship Lottery Act (A.C.A. §§ 23-115-101 to -1101) implements it. Amendment 100 (2018) authorized casino gaming at licensed venues. Amendment 84 (2006) authorized charitable bingo and raffles when conducted by qualifying nonprofits. The Charitable Bingo and Raffles Enabling Act (A.C.A. §§ 23-114-101 to -706) implements Amendment 84.
The five-year continuity rule for authorized organizations exists to prevent ad-hoc nonprofits from being formed solely to run raffles. A real, established charity with five years of operating history qualifies; a brand-new entity does not.
The opinion's framework applies to door-prize giveaways at fundraisers, but it generalizes to any charity event where prizes are involved. Free entry, no problem. Paid entry, get into the raffle exception or don't run it.
Citations and references
Statutes and constitutional provisions:
- Ark. Const. amend. 84, § 1 (charitable bingo and raffles)
- Ark. Const. amend. 87 (Arkansas Scholarship Lottery)
- Ark. Const. amend. 100 (Casino Gaming Amendment of 2018)
- Ark. Const. art. 19, § 14 (lotteries)
- A.C.A. §§ 23-114-101 to -706 (Charitable Bingo and Raffles Enabling Act)
- A.C.A. § 23-114-102(1)(A) (authorized-organization definition)
- A.C.A. § 23-114-102(16) (raffle definition)
- A.C.A. § 23-114-103(a) (charitable-purpose net-receipts requirement)
- A.C.A. §§ 23-115-101 to -1101 (Scholarship Lottery Act)
Cases:
- Sharp v. State, 350 Ark. 529, 88 S.W.3d 848 (2002)
- Portis v. State, 27 Ark. 360 (1872)
- Cox v. Daniels, 374 Ark. 437, 288 S.W.3d 591 (2008)
Prior AG opinions cited:
- Ark. Att'y Gen. Ops. 2016-073, 2009-123, 2007-247, 2005-217, 2004-091, 2002-240, 95-393, 86-599
Source
Original opinion text
BOB R. BROOKS JR. JUSTICE BUILDING
101 WEST CAPITOL AVENUE
LITTLE ROCK, ARKANSAS 72201
Opinion No. 2025-022
August 15, 2025
Ms. Sonia Fonticiella
Prosecuting Attorney, Second Judicial District
Post Office Box 49
Marion, Arkansas 72364
Dear Ms. Fonticiella:
I am writing in response to your request for my opinion on whether a 501(c)(3) nonprofit organization may donate college football tickets as door prizes at a fundraising event without "infringing Arkansas law."
RESPONSE
Under facts you have provided, the answer to your question depends on whether someone must pay or give other consideration specifically to have a chance to win the prize.
DISCUSSION
Generally, "gambling" and "gaming" are prohibited in Arkansas. Although neither word is defined by statute, the Arkansas Supreme Court uses these words interchangeably and has defined them as "the risking of money between two or more persons, on a contest or chance of any kind, where one must be loser and the other gainer."
But specific types of "gambling" or "gaming" are exempt and authorized in limited circumstances: bingo and raffles conducted by certain licensed entities; the Scholarship Lottery conducted by the State under the Scholarship Lottery Act; and certain games conducted by authorized casinos under the Arkansas Casino Gaming Amendment of 2018. Thus, a nonprofit could not offer a door prize that is a "lottery" or "casino game."
However, a nonprofit could offer a door prize that is a "raffle" if the nonprofit meets and complies with certain statutory requirements. Based on the information you submitted with your opinion request, I will focus on raffles and lotteries.
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Lottery. Under the Arkansas Constitution, the only authorized lotteries are those conducted by the State under the Scholarship Lottery Act. Consequently, a nonprofit cannot conduct a lottery. Door prizes at a fundraising event qualify as a "lottery" if each of the following requirements are met: (1) consideration, whether directly or indirectly, is paid to participate; (2) the scheme in question "is controlled by chance such that winning is not influenced by the skill or judgment of those participating"; and (3) a prize is awarded. If each requirement is met, the door-prize scheme would be a lottery and, therefore, must be conducted by the State under the Scholarship Lottery Act.
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Raffles. While raffles are a type of lottery, they are exempted under the Arkansas Constitution from the prohibition of lotteries discussed above, if they are conducted in a certain way. When someone sells a ticket "to win a prize awarded through a random drawing," that is a "raffle." Raffles do not "include any game played through the use of a machine or electronic device." The Charitable Bingo and Raffles Enabling Act implements Amendment 84 (a constitutional initiative) to the Arkansas Constitution, authorizing raffles by an "authorized... [raffles] organization", if the net receipts over and above the actual cost of conducting the raffle are used only for charitable, religious, or philanthropic purposes. An "authorized organization" is a certain "nonprofit tax-exempt" organization that "has been in continuing existence as a nonprofit tax-exempt organization" in Arkansas for at least five years immediately prior to conducting" the raffle.
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Application. The application of the foregoing law to the situation you describe depends on some details that have not been conveyed to me. If, in the scenario you have in mind, no one pays any money specifically for a chance to win the tickets, then no one has engaged in the "risking of money" in a "contest" or "chance of any kind." Therefore, under that scenario, the chance to win the tickets would not qualify as "gambling" under the Arkansas Supreme Court's definition discussed above. That conclusion would still be correct even if the attendees at the event where the tickets were given away paid to attend. In that scenario, the attendees are paying to attend the event itself, not "risking" money for a chance to win something. But the conclusion would be different if the attendees paid some additional amount over and above their entrance fee for a chance to win the tickets. In that case, the additional amount paid would be "risking" money for a chance to win the tickets and would constitute gambling. If tickets are sold to win the football tickets through a random drawing, an organization holding the drawing could fall under the authorized type of gambling, a raffle, if they meet the definition of "nonprofit tax-exempt organization" discussed above and follow the required steps for conducting a raffle. But whether the organization holding such a drawing meets the requirements for a raffle depends on facts that have not been conveyed to me.
Assistant Attorney General William R. Olson prepared this opinion, which I hereby approve.
Sincerely,
TIM GRIFFIN
Attorney General