Ezel / AG Opinions / NC
NC NC AG Advisory Opinion (1981-02-26) 1981-02-26

Can a North Carolina city deny a special use permit for a bingo establishment to a for-profit corporation whose prizes exceed ten dollars per game?

Short answer: Yes. The AG concluded a Goldsboro city ordinance conditioned on compliance with the Bingo and Raffles law could be enforced to deny a permit. G.S. 14-292.1 limits regular bingo to tax-exempt organizations defined in subsection (b)(1), and permits any entity to run bingo only when prizes are ten dollars or less per game. A for-profit corporation admitting prizes over ten dollars per game satisfied neither path.
Currency note: this opinion is from 1981
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.
Disclaimer: This is an official North Carolina Attorney General advisory opinion. AG opinions are persuasive authority but not binding precedent like a court ruling. This summary is for informational purposes only and is not legal advice. Consult a licensed North Carolina attorney for advice on your specific situation.
About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official AG opinion. The original opinion (linked at the bottom of this page) is the authoritative source for any reliance.

Plain-English summary

The City of Goldsboro had a zoning ordinance that required bingo special-use permit applicants to provide sufficient evidence that they complied with North Carolina's Bingo and Raffles law (G.S. 14-292.1). A for-profit corporation applied for a permit and openly admitted two things: it was not a tax-exempt organization as defined by G.S. 14-292.1(b)(1), and its bingo cash prizes would exceed ten dollars per game. The Goldsboro City Attorney asked whether the Board of Aldermen could deny the permit on those facts.

The AG said yes. G.S. 14-292.1 operated on two tracks. The first track was for "exempt organizations" as defined in G.S. 14-292.1(b)(1), which were permitted to conduct bingo and raffles within the procedural framework of subsections (a) through (k). The second track was a narrow safe harbor in G.S. 14-292.1(l): any person or entity, exempt or not, could run bingo games as long as the prize value in cash or merchandise was ten dollars or less per game. A for-profit corporation could only use the second track, and only if it stayed within the ten-dollar prize cap.

When the applicant in Goldsboro admitted both that it was not tax-exempt and that its prizes would exceed ten dollars, it had taken itself outside both legal paths. The city ordinance was therefore properly applied to deny the permit.

Currency note

This opinion was issued in 1981. 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.

North Carolina's bingo and gaming statutes have been amended many times since 1981. The numbering of subsections within G.S. 14-292.1 and the specific dollar thresholds may differ today. Anyone facing a current bingo permit question should pull the current version of Chapter 14 and consult counsel.

Common questions

Q: Could a for-profit business run bingo at all under this opinion?
A: At the time, only under the ten-dollar-prize safe harbor in G.S. 14-292.1(l). Any prize above ten dollars per game required tax-exempt-organization status as defined in G.S. 14-292.1(b)(1).

Q: Could a city refuse a bingo permit on grounds other than statutory compliance?
A: The opinion only addressed denial based on noncompliance with G.S. 14-292.1. A city's broader special-use permit authority is governed by its own ordinance and the zoning enabling statutes.

Q: What counts as a "tax-exempt organization" for bingo purposes?
A: G.S. 14-292.1(b)(1) defined the class. It tracked recognized charitable, religious, civic, fraternal, and similar groups, typically those with IRS § 501(c)(3) or similar status.

Q: Did the city need its own bingo ordinance to deny the permit?
A: Goldsboro's leverage came from a zoning special-use permit that incorporated G.S. 14-292.1 compliance as a condition. Without that condition, the city would have been enforcing only the state statute, which is generally a state prosecutorial matter.

Background and statutory framework

The two-track structure of G.S. 14-292.1 is what carried the analysis:

  • Subsections (a) through (k) set up the operational rules (licensing, frequency, prize limits, audit requirements) for "exempt organizations" running bingo and raffles. Subsection (b)(1) defined which organizations qualified.
  • Subsection (l) (described in the opinion as "G.S. 14-292.1(1)") was a small-stakes safe harbor: anyone could run a bingo game so long as the prize did not exceed ten dollars per game. The safe harbor was designed for casual play (church socials, school fundraisers under the threshold, fairs) without triggering the full exempt-organization framework.

A for-profit corporation that wanted to run real-money bingo could only do so under the safe harbor. Stepping over the ten-dollar line required it to also qualify as an exempt organization, which by definition it could not.

The Goldsboro ordinance imported the state-law compliance check directly into its zoning special-use permit decision. That is a common municipal technique: condition a discretionary permit on demonstrated state-law compliance, and treat the applicant's admitted noncompliance as conclusive. The AG approved that approach for this situation.

Citations

  • N.C.G.S. § 14-292.1 (Bingo and Raffles)
  • N.C.G.S. § 14-292.1(b)(1) (definition of exempt organization)
  • N.C.G.S. § 14-292.1(a)–(k) (operational framework for exempt organizations)
  • N.C.G.S. § 14-292.1(l) (ten-dollar prize safe harbor)

Source

Original opinion text

Requested By: W. Harrell Everett, Jr.
City Attorney
Goldsboro, North Carolina

Question:
Where a city ordinance required applicants to provide sufficient evidence that they comply with the requirements of G.S. 14-292.1 (North Carolina's Bingo and Raffles law) to qualify for a special use permit to operate a bingo establishment within its city limits, may a city Board of Aldermen deny issuance of the permit to a for-profit corporation where the corporation admits that its not a tax-exempt organization as defined in G.S. 14-292.1(b)(1) and states that its cash prize would be in excess of $10.00 per game?

Conclusion:
Yes.

Generally, G.S. 14-292.1 allows certain exempt organizations as defined by G.S. 14-292.1(b)(1) to operate bingo games and raffles pursuant to G.S. 14-292.1(a) through (k). G.S. 14-292.1(l) allows any person or entity to operate bingo games where the prize value in cash or merchandise is ten dollars ($10.00) or less per bingo game. Although a for-profit corporation may comply with G.S. 14-292.1(l), it cannot comply with G.S. 14-292.1(b)(1) which defines the type of exempt organization permitted to operate bingo games and raffles in accordance with G.S. 14-292.1(a) through (k). Therefore, a city Board of Aldermen can deny issuance of a special use permit to operate a bingo establishment to a for-profit corporation where the corporation admits that it is not a tax-exempt organization as defined by G.S. 14-292.1(b)(1) and states that its cash prize would be in excess of ten dollars ($10.00) per game.

Rufus L. Edmisten
Attorney General

Acie L. Ward
Assistant Attorney General