Submission Date:
Question:
We are beginning our long-range planning process and are asking patrons to fill out a community survey to assess what the community wants to see in the library now and in the future. Thinking it was a good idea to raffle off gift cards to encourage participation, I gave my board trustees a letter requesting a donation of gift cards. Another director told me I'm not supposed to have the board ask for donations in any form. This is something our Friends group should do. Please advise. Thanks in advance!
Answer:
Following our "do not reinvent the wheel" rule for "Ask the Lawyer," prior to diving into this, we checked the "Trustees Handbook" posted at https://www.nysl.nysed.gov/libdev/trustees/handbook/handbook.pdf. On page 57, it provides an excellent summation of the concern at play in the issue of trustees and fund-raising:
"Public library boards generally take care to separate private fundraising efforts (such as direct personal solicitations, as opposed to seeking grants from foundations or government agencies) from normal library operations and board activities since there are restrictions on the appropriate use of public funds." [emphasis added]
The Handbook then points out that this concern is why many public libraries use "Friends" to personally solicit and raise funds.
To this concern about limits on the use of public funds, I would add that when it comes to raising money, it is very easy for the solicitation to run afoul of charitable regulations, required accounting, and limits on allowed fund-raising activities (such as games of chance).
But does this caution merit a complete bar on such solicitations?
To explore that, let's explore the risks. And we're also going to talk about "raffles", so hang in there, association libraries...this one's for you, too.
Before a board solicits gifts, it should have a full suite of "fiscal controls" and accounting practices to govern how the solicitation is done. A policy on soliciting/accepting donations, and policy on fund-raising events, a policy on procurement...if a board ensures that its actions in soliciting gifts are following a legally compliant policy, this mitigates the risk of no-compliance.
Let's take the member's specific situation as an example: Could trustee solicitations of gift cards for a raffle used as an inducement to participate in a survey on library use be done carefully enough to avoid a concern?
Here are the risks in such an endeavor: the library is planning to 1) have trustees ask for donations of gift cards; 2) use the cards as an inducement to fill out a survey; then 3) "raffle" the donated cards; then 4) use the answers from the survey "to assess what the community wants to see in the library now and in the future."
Of the 4 things listed above, only #1--the solicitation of the cards--doesn't give me pause. If the library has a good donation acceptance policy, and the cards are donated per that policy, and the library follows the conditions for the donation...then it is just another donation.
#2 poses a risk that is pretty easy to mitigate with a little caution. In the world of not-for-profits in New York, a "raffle" is a "game of chance". This means a "raffle" can be considered "charitable gaming" which can require registration and particular accounting (see General Municipal Law of New York (Section 186), and registration).
However, as defined by law, a "raffle" in New York requires the purchase of tickets for payment of money.[1] Since the draw described isn't technically a "raffle" (it's a drawing), to avoid any confusion, it might be good to avoid using that word.[2]
In addition, if you have time, it would be good to call your local County Clerk to make sure they don't regard the use of raffle tickets without payment of money to be a "raffle."[3]
Okay, the "raffle" concern is pretty easy to ameliorate. My concerns about #2 and #4 are a little more subtle and tricky.
As stated, the library is hoping the lisupare[4] will inspire people to fill out a survey to assess what the community wants to.
This means that the library hopes to use the results of the survey to make decisions about such things as programming, collection decisions, and the library facility. From the sound of it, the input could even be used to develop plans for renovation or new construction funded by a bond or other municipal funding initiative in the future.
I imagine you see where I am going here. By offering a reward with a defined financial value for participating in the survey, the board would risk the assertion of a direct link between financial compensation and a person filling out the survey a certain way.
I know. This seems ridiculous. But complaints have been made about far more innocuous things.
To avoid this, I suggest the library consider a different approach to incentivizing broad community participation in the survey. For instance, each person who completes one gets a leaf ornament or token to hang on a display, so the community can see how many people have taken time out of their day to give their feedback to the library.[5] In this scenario, the trustees could request donations of the ornaments or display (which can then become part of the library's stock of display materials) can just follow the usual policy for accepting donations.
I am sorry to have to write this; I hate throwing cold water at good ideas. Further, I am not saying the "raffle" (uh, that's "lisupare") is outright wrong. But libraries function in large part because of the love and trust they foster in the public. While the notion of a chance to be selected for a monetary gift for taking the time to complete a library survey is lovely, I think it can be interpreted wrongly--either in the moment, or down the road.
Thank you for trusting me with this question.[6]
[1] Per GML 186 3-b, a "raffle", when conducted by a not-for-profit in NY, is a " game of chance in which a participant pays money in return for a ticket or other receipt and in which a prize is awarded on the basis of a winning number..." etc.
[2] You could go with a made-up word like "lisupare" ["Lie-soo-puh-ray; noun; definition: a randomly given library survey participation reward.]
[3] To address this, I called the NYS Gaming Commission. Let's just say that unless you are reporting suspected gaming crimes, the Commission doesn't like to get in touch over the phone. So, then I scoured their materials on "charitable gaming" at https:/www.gaming.ny.gov/charitablegaming/. While it is clear the law requires "payment" which is defined as "legal tender, check, or credit card", I didn't find anything ruling out a situation like the one described (people "paying" for a raffle ticket by performing a task). So, getting assurance from your county clerk, who keeps an eye on local charitable gambling, is a good idea. Hopefully, they will laugh at the very idea that this could be seen as a "raffle."
[4] See footnote #2.
[5] I am a lawyer, not a professional display-maker, so I have no doubt a library employee with experience making displays can come up with a much, much, MUCH better version of this.
[6] Just so readers know, I spoke with the director who submitted this question, who was very cool about all my agita.
