A petition to legalize for-profit raffles in the state of California.

Raffles and lotteries are fun and draw a huge amount of players in the hopes of winning money or prizes. Recently, a bank in South Africa invented a new kind of savings account called the Prize-Linked Savings Account. Account holders were automatically added to a regular lottery from the bank. The money came from a portion of the interest accrued from their collective accounts. This added the fun of a raffle drawing to the sensibility of building a savings account. The account was wildly successful drawing in 2 million new savings account holders.

Unfortunately this South African bank was asked to stop by the government because only they are allowed to hold lotteries. (In spite of the fact that the bank got permission from the South African lottery).

(You can listen to this story if you follow this link:

http://freakonomics.com/2012/04/26/lottery-loopholes-and-deadly-doctors-a-new-freakonomics-radio-podcast/)

Here in America, lotteries and raffles are also only allowed to be run by the state and federal governments. But what if that were to change and for-profit raffles were permitted?

What we propose is to make For-profit Raffles legal in the state of California. The state and national lotteries will be able to continue uncontested, but for-profit raffles will be available to all!

We foresee that in the same way auctions and auction houses are currently run, state-certified “Raffle Houses” can also be run to raffle off items for private citizens. Or alternatively, an e-Bay style raffle website can draw in an even larger audience of buyers. The seller and the “Raffle House” can decide how much each ticket will cost (i.e., $1 vs $10), and determine if there should be a limit to how many tickets one person may buy (to avoid someone buying 5,000 tickets for a 6,000 ticket raffle).

Who benefits?

1. Individuals

Let’s say you want to sell your car for $3,000. Currently, you can put it on the street or on-line and hope for a buyer with $3,000. But if no one calls, no sale. But what if there were this e-Bay like website where you could raffle the car for $1 tickets? Your chances of making $3,000 greatly increases with the size of the people who want the car. Because buyers with $3,000 ready to spend are fewer in number than buyers with $1 in their pockets.

2. Businesses

Businesses will also take advantage of raffling their goods and services A winery that is struggling to make ends meet can raffle a case of wine and increase much needed revenue in a short amount of time. Not only does this generate revenue, but also promotes the company and good will with customers.

3. Banks

As mentioned earlier, South Africa ran a very popular savings account raffle. American banks can run similar Prize-Linked Savings account and boost their popularity and clientele.

4. Local governments and schools

Currently state and federal lotteries like Mega-Millions and Powerball Lotto provide money for education and other budgetary needs. But that revenue is spread out across many schools and states. If local towns and schools had the opportunity to hold their own raffles, more focused and immediate revenues could be made without oversight or delay by legislature.

A Raffle is better than an Auction

Let’s say you go to an auction with 1,000 people. A certain item is put up on the block and everyone likes it and would bet if they could. Bidding starts at $100 and eventually is bid up and sold for $200.

Now let’s have a raffle! One thousand people see the item on the block and the tickets are $1 each. More people will be willing to put in $1 for the chance of to win than there are people with $200 to spare. Even if only half the attendees buy tickets, that’s $500 to the seller. And whoever wins the bike still has $199 left in his pocket for the next raffle! Everyone walks away more profitable than those at the auction! Everybody wins bigger!

Obviously, there will need to be oversight from Standards and Practices, and other details must be debated and worked before this law is rewritten.

But we believe that this will add immediate and much needed revenue to businesses and individuals while at the same time helping small, more local governments and organizations meet their needs.

Because Raffles are fun!

Please sign our petition below and forward it to others. Thank you!