PUBLIC PROTECTION CABINET
Department of Charitable Gaming
(As Amended at ARRS, November 10, 2015)
820 KAR 1:120. Allowable expenses.
RELATES
TO: KRS 238.536, 238.550(9)
STATUTORY
AUTHORITY: KRS 238.515(2), (4), (9), 238.550(9)[(j)]
NECESSITY,
FUNCTION, AND CONFORMITY: KRS 238.515(4) authorizes the department[office]
to establish standards to insure charitable gaming receipts are properly
accounted for and KRS 238.515(9) authorizes the Department[Office]
of Charitable Gaming to promulgate administrative regulations necessary to
carry out the provisions of the chapter. KRS 238.550(9)(a) to (i)
lists the categories of expenses authorized by statute. KRS
238.550(9)(j) authorizes the Department[Office] of Charitable
Gaming to approve charitable gaming expenses determined to be legitimate but
which have not already been authorized by statute. This administrative
regulation establishes the other allowable expenses and establishes the limitations
and exclusions for the listed categories of expenses.
Section
1. Other Allowable Expenses. In addition to those authorized expenses provided
for in KRS 238.550(9), each of the following expenses is determined to be
legitimate and shall be allowable charitable gaming expenses of a licensed
charitable organization:
(1)
The following customary and usual banking fees or charges paid to any financial
institution in connection with an organization's charitable gaming account:
(a)
Monthly service charges;
(b)
Check verification service charges;
(c)
Check printing charges;
(d)
Charges relating to returned checks; or
(e)
Copying charges for bank records;
(2)
Customary and usual fees or charges paid to a check reader or verification
company incurred in connection with the organization's charitable gaming
activities;
(3)
Customary and usual fees or charges incurred with accepting and processing
credit card purchases from patrons at the organization's charitable gaming
activities;
(4)
Food, any noncash item not to exceed twenty-five (25) dollars in fair
market value given upon achieving a predetermined goal in a raffle, or clothing
provided to volunteers as authorized in 820 KAR 1:060;
(5)
Payments made to the Department[Office] of Charitable Gaming;
(6)
Printing costs incurred in connection with an organization's charitable gaming
activities, which shall be the costs for printing or copying raffle tickets,
gaming occasion programs, house rules, and vouchers;
(7)
Payments for the purchase of prizes to be awarded during the organization's
conduct of charitable gaming;
(8)
Promotional items;
(9)
Federal excise taxes levied under 26 U.S.C. 4401 and 4411, or fees associated
with the filing of Internal Revenue Service Form 11-C and paid by a licensed
charitable organization during the calendar year; and
(10)
Customary and usual fees or charges incurred in the collection of checks
dishonored for insufficient funds.
Section
2. Charitable Gaming Expense Categories. (1) The items that may be included as
a utilities expense, pursuant to KRS 238.550(9)(c), shall be the money paid for
electric, gas, water, sewer, telephone, and trash collection. It may also
include any cable or internet expenses that are incurred by the
charitable organization for credit card services,[or]
card-minding devices, or electronic pulltab systems.
(2)
The items that may be included as an advertising expense, pursuant to KRS
238.550(9)(e), shall be the expenses for a handout, flyer, radio, television,
advertising sign, billboard, or other media used to promote an event or
activity required to be licensed under KRS Chapter 238 and any printing costs
associated with them.
(3)
The items that may be included as a bookkeeping expense, pursuant to KRS
238.550(9)(g), shall be the costs of completing the financial report, the
federal excise tax form, and the federal gaming forms. Bookkeeping expenses
shall not include expenses associated with handling charitable gaming funds,
preparing gaming occasion records, or ordering supplies.
(4)
The items that may be included as security services, pursuant to KRS 238.550(9)(h),
shall be the expenses associated with paying a person whose sole duty is to
promote and provide peace, order, and safety at a charitable gaming event
which:
(a)
May include patrolling the parking lot or accompanying the organization's
personnel to the bank or night depository with the charitable gaming receipts;
and
(b)
Shall not include costs for security or alarm systems or for special lighting
for the building or parking lot.
SCOTT
JONES, Commissioner
AMBROSE
WILSON IV, Secretary
APPROVED
BY AGENCY: August 12, 2015
FILED
WITH LRC: August 14, 2015 at 11 a.m.
CONTACT
PERSON: Noelle J. Bailey, General Counsel, Department of Charitable Gaming, 132
Brighton Park Boulevard, Frankfort, Kentucky 40601, phone (502) 573-5528, fax
(502) 573-6625.