Committee weighs LB828 to let Nebraska nonprofits run sweepstakes for fundraising

Senator Barry DeKay introduced LB828 to allow nonprofit organizations to conduct gift enterprises—commonly known as sweepstakes—by striking the statutory language that excludes nonprofits from the definition of an "operator" for gift enterprises.

Proponents argued the change would provide Nebraska nonprofits a widely used fundraising tool. Clay Smith, owner and CEO of Speedway Motors and director of the Museum of American Speed, said Nebraska is one of only two states that do not allow nonprofits to use sweepstakes and that national sweepstakes help museums and other nonprofits raise unrestricted funds. "Allowing Nebraska nonprofits to conduct national fundraising sweepstakes would strengthen Nebraska's nonprofits," he testified.

Kevin Sander, development director, and other nonprofit fundraisers described sweepstakes as a low-overhead tool that helps organizations reach donors across state lines.

The Nebraska Credit Union League said it negotiated an amendment (AM1785) to preserve an existing exemption for chartered credit unions and offered neutral testimony supporting the amendment. The Department of Revenue's Charitable Gaming Division (Brian Rockey) testified in a neutral capacity and noted the bill would broaden nonprofit promotional latitude while raising enforcement and regulatory questions.

Committee members asked about consumer protections, the definition that distinguishes gift enterprises from lotteries, and the effect on existing credit-union savings-promotions. Several witnesses emphasized that sweepstakes include free-entry options and are regulated in other states.

The committee closed public testimony; any amendments (including the credit-union preservation amendment) will be considered in ensuing committee business.