Can two or more Arizona nonprofits team up to run a single raffle without violating gambling laws, or does each raffle need a single sponsoring nonprofit?

Plain-English summary

Arizona generally treats raffles as illegal gambling, but A.R.S. § 13-3302(B) carves out an exception for qualifying nonprofits. The carve-out has four pillars: the organization must hold tax-exempt status under one of the listed paragraphs of A.R.S. § 43-1201; no officer, director, employee, or agent may receive any direct or indirect pecuniary benefit; the organization must have existed continuously in Arizona for five years before the raffle; and only a "bona fide local member of the sponsoring organization" may participate in the raffle's management, sales, or operation.

Senator Farley asked the AG whether two qualifying nonprofits could combine forces and run a single, joint raffle. The "bona fide local member of the sponsoring organization" language could be read to forbid this, since a member of one nonprofit working on a raffle the other co-sponsors would not be a "bona fide local member" of the second nonprofit.

AG Brnovich rejected that restrictive reading. Two organizations that could legally run separate raffles cannot become criminals by cooperating. Nothing in the legislative history suggests an intent to forbid joint raffles. A.R.S. § 13-104 expressly directs courts to construe Title 13 "according to the fair meaning of [its] terms to promote justice and effect the objects of the law," not strictly. Reading the statute to bar joint raffles would do the opposite.

The opinion has two important caveats. First, each co-sponsoring organization must independently meet every one of § 13-3302(B)'s requirements. A nonprofit that does not qualify on its own cannot piggyback on a partner. Second, joint sponsorship cannot be used to acquire a privilege one organization wouldn't otherwise have. The example flagged in the footnote: a small nonprofit cannot team up with a hospital or child-abuse-prevention organization to gain access to the contracted-outside-agent privilege in § 13-3302(B)(4).

Currency note

This opinion was issued in 2015. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Background and statutory framework

Title 13 of the Arizona Revised Statutes makes gambling generally illegal in Arizona. A.R.S. § 13-3303 criminalizes the promotion of gambling and § 13-3304 criminalizes benefitting from gambling. Section 13-3302 carves out specific exclusions, of which the nonprofit raffle exemption is one.

The raffle exemption requires:

• Tax-exempt status under A.R.S. § 43-1201, subsection A, paragraph 1, 2, 4, 5, 6, 7, 10, or 11. These paragraphs cover charitable organizations, educational organizations, religious organizations, certain civic leagues and associations, agricultural and horticultural organizations, and similar nonprofits.
• Continuous existence in Arizona for at least five years before the raffle.
• No pecuniary benefit (direct or indirect) to any member, director, officer, employee, or agent beyond the ability to participate in the raffle on equal footing with everyone else.
• Management, sales, and operation by "bona fide local member[s]" of the sponsoring organization, no outside agents.

A separate provision in § 13-3302(B)(4) gives hospitals and certain child-abuse-prevention nonprofits the additional flexibility to contract with an outside agent for raffle operations. That privilege is not available to nonprofits outside those defined categories.

The opinion's reasoning rests on three statutory-construction principles. First, the plain text doesn't expressly forbid joint sponsorship. Second, A.R.S. § 13-104 forbids strict construction of Title 13 in favor of construction that promotes justice and effectuates the law's objects. Third, statutory silence cannot be invoked to imply an intent the legislature didn't express.

The legislative purpose, as the opinion reads it, is twofold: protect a critical fundraising channel for organizations that serve the public, and protect raffle integrity. Cooperative raffles among independently qualified organizations advance both purposes.

Common questions

Q: My nonprofit and another local 501(c)(3) want to run a joint raffle. Can we?
A: Under this opinion, yes, as long as both nonprofits independently meet every requirement of A.R.S. § 13-3302(B): tax-exempt status under the listed paragraphs of § 43-1201, five years of continuous Arizona existence, no pecuniary benefit to insiders, and management/sales/operation by bona fide local members.

Q: Can a member of nonprofit A handle ticket sales for a joint raffle co-sponsored with nonprofit B?
A: The opinion treats joint sponsorship as creating one combined "sponsoring organization" for purposes of the bona-fide-local-member requirement, so members of either co-sponsor can do management, sales, or operations work.

Q: We're a small nonprofit. Can we team up with a hospital so we can use a contracted outside vendor for a raffle?
A: No. The opinion's footnote 2 flags this as off-limits. Joint sponsorship cannot be used to acquire privileges one of the organizations wouldn't otherwise have. The outside-vendor privilege in § 13-3302(B)(4) belongs to the specifically listed entity types only.

Q: Does the five-year-continuous-existence requirement apply to the partnership or to each organization?
A: Each organization must independently meet it. The opinion is explicit that joint sponsorship cannot create or transfer eligibility, only allow already-qualified organizations to combine efforts.

Q: We want to share proceeds with a third nonprofit that didn't help organize the raffle. OK?
A: That issue isn't directly addressed in the opinion. The statute requires that proceeds redound to the sponsoring organizations, and any nonprofit receiving proceeds in a sponsoring role must itself qualify. Consult counsel.

Citations and references

Statutes:

• A.R.S. § 13-3302 (gambling exclusions; raffles)
• A.R.S. § 13-3303 (promotion of gambling)
• A.R.S. § 13-3304 (benefitting from gambling)
• A.R.S. § 13-101 (purposes of Title 13)
• A.R.S. § 13-104 (rules of construction)
• A.R.S. § 43-1201 (income tax exemptions)

Cases:

• State v. Williams, 175 Ariz. 98 (1993)
• Bilke v. State, 206 Ariz. 462 (2003)
• Sell v. Gama, 231 Ariz. 323 (2013)
• Martin v. Martin, 156 Ariz. 452 (1988)

Earlier AG opinions:

• Ariz. Att'y Gen. Op. I90-035 (1990)

Source

• Landing page: https://www.azag.gov/opinions/i15-006-r15-007
• Original PDF: https://www.azag.gov/sites/default/files/2025-06/I15-006.pdf

Original opinion text

To:

Senator Steve Farley

Arizona State Senate

Questions Presented

You have asked whether more than one nonprofit organization may be the "sponsoring organization" for a common raffle pursuant to Arizona Revised Statutes Section 13-3302(B)?

Summary Answer

Yes. More than one nonprofit organization may be the "sponsoring organization" for a common raffle under section 13-3302(B), provided that each organization independently meets the exclusion requirements.

Background

Gambling is generally illegal in Arizona. See A.R.S. § 13-3303 (Promotion of gambling), § 13-3304 (Benefitting from gambling). The Arizona Legislature has identified particular conduct that is excluded from the general prohibition. A.R.S. § 13-3302 (Exclusions);see also Ariz. Atty Gen. Op. I90-035 (1990). Of relevance to this opinion, section 13-3302(B) permits certain organizations to conduct a raffle, which would otherwise constitute unlawful gambling, under specific conditions:

B. An organization that has qualified for an exemption from taxation of income under § 43-1201, subsection A, paragraph 1, 2, 4, 5, 6, 7, 10 or 11 may conduct a raffle that is subject to the following restrictions:

1. The nonprofit organization shall maintain this status and no member, director, officer, employee or agent of the nonprofit organization may receive any direct or indirect pecuniary benefit other than being able to participate in the raffle on a basis equal to all other participants.

2. The nonprofit organization has been in existence continuously in this state for a five year period immediately before conducting the raffle.

3. No person except a bona fide local member of the sponsoring organization may participate directly or indirectly in the management, sales or operation of the raffle.

A.R.S. § 13-3302. The remainder of subsection B sets forth further specified exclusions relating generally to hospitals and certain non-profits engaged in child abuse prevention and related advocacy; entities meeting these criteria are permitted to contract with an outside agent for purposes of a raffle. A.R.S. § 13-3302(B)(4).

Analysis

Because no court has addressed this issue, it is a basic question of statutory interpretation to determine the scope of the gambling exclusion under section 13-3302(B). "Our task in interpreting the meaning of a statute is to fulfill the intent of the legislature that wrote it." State v. Williams, 175 Ariz. 98, 100 (1993). "In determining the legislature's intent, we initially look to the language of the statute itself." Bilke v. State, 206 Ariz. 462, 464 ¶ 11 (2003). If the statute's language is clear, we apply it "unless application of the plain meaning would lead to impossible or absurd results." Id. "The general rule that a penal statute is to be strictly construed does not apply to [Title 13], but the provisions herein must be construed according to the fair meaning of their terms to promote justice and effect the objects of the law, including the purposes stated in section 13-101." A.R.S. § 13-104.

Section13-3302(B)(3) requires that only a "bona fide local member" of a sponsoring organization participate directly in a permitted raffle. This language does not explicitly prohibit two organizations from coming together to offer a raffle, but it could be read restrictively to imply such a prohibition given that a joint raffle would likely involve the participation of individuals who are not "bona fide local member[s]" of both organizations. Such a restrictive reading means two organizations that could legally conduct raffles independently would be guilty of illegal gambling when they do so collaboratively. Nothing in the statutory language indicates that our Legislature intended such an arbitrary result. Moreover, A.R.S. § 13-104 specifically forbids such a strict construction because such an interpretation would not "promote justice and effectuate the objects of the law," A.R.S. § 13-104, or otherwise serve the purposes of Title 13 set forth in section 13-101.

As noted previously, the statute is silent as to the question presented. Statutory silence cannot be invoked as an indication of legislative intent. See, e.g., Sell v. Gama, 231 Ariz. 323, 328 ¶ 21 (2013) ("we find it not plausible to interpret the statutory silence as tantamount to an implicit [legislative] intent.") (internal quotation marks omitted, alterations in original). This silence may be resolved by looking to "the context of the [legislation], the language used, the subject matter, the historical background, the effects and consequences, and the spirit and purpose of the law. Martin v. Martin, 156 Ariz. 452, 457 (1988). Here, by creating the non-profit exception to the general prohibition on raffles, the Legislature expressed its concern with preserving a critical fundraising source for organizations that serve the public. By restricting "management, sales or operation" of the raffle to members of the sponsoring organization, and by strictly defining those organizations which can sponsor raffles, the Legislature codified its intent that raffles be conducted with integrity and inure to the benefit of the organization. There is no statutory language that indicates a concern with otherwise qualified organizations conducting a joint raffle. Accordingly, the intent, purpose, and fair meaning of the statute is clearly served and best effectuated if organizations that are independently qualified under § 13-3302(B) may cooperate in their objective to serve the public interest.

Conclusion

More than one organization may serve as the "sponsoring organization" for a raffle under section13-3302(B), so long as each sponsoring organization is independently qualified to conduct such a raffle under the statute.

Mark Brnovich

Attorney General

While legislative history is not relevant here (and in general is not a reliable source of authority), it is also instructive to note that the legislative history of section 13-3302(B) is devoid of any concern regarding such collaborative raffles.

Nothing in this opinion should be read to suggest that an organization may gain a right or privilege it would not otherwise be entitled to by collaborating with another organization. This extends to the requirements in sections 13-3302(B)(1) and (3), that raffles be conducted by members of qualified organizations and that proceeds from the events redound to the benefit of the sponsoring organizations (e.g., an organization that is excepted from sections 13-3302(B)(1) and (3) cannot gain the advantage of the exception in section 13-3302(B)(4)).