COMMENTS THOMAS W. KELTY, Chief Counsel, Illinois Municipal League

BLACKJACK AND ROULETTE/
FREEDOM OF INFORMATION

I. THE CHARITABLE GAMES ACT

On August 20, 1986, Governor James R. Thompson signed Senate Bill 1552, the Charitable Games Act. Public Act 84-1303 provides not-for-profit organizations with the legal authorization to conduct "Casino Night" fund raising activities that had previously been in a grey area of the law. The Act sets forth the qualifications and parameters under which these activities may be conducted and provides clear guidance to organizations wishing to hold casino nights.

This Act, originally introduced by Senators Lechowicz, Marovitz and Dudycz, recognizes in its statements of findings and intent the "important and necessary services" the charitable organizations provide and the "need to provide methods of fund raising to such not-for-profit organizations so as to enable them to meet their stated charitable and social purposes." Additionally, the legislature restates its position on other gambling in Illinois. "It is the purpose and intent of this act...to reaffirm that gambling in Illinois, for noncharitable purposes, is not to be allowed." After these statements of intent the Act clearly sets forth the conditions under which not-for-profit organizations may conduct such activities.

Licensing provisions are to be administered and regulated by the Illinois Department of Revenue. The Act provides one type of license for organizations conducting the fund raising and separate licenses for those entities providing locations, materials and supplies for the conduct of charitable games.

An organization applying for a license is required to pay an annual fee of $200.00 and be approved by the Department as meeting the qualifications of a qualified organization. Such an organization is defined in the Act in one of two categories. First, an applicant organization is eligible for a license if it is "a charitable, religious or educational organization or institution organized and conducted on a not-for-profit basis with no personal profit inuring to any one as a result of the operation and which is exempt from federal income taxation under Section 501 (c) (3) of the Internal Revenue Code." The second type of eligible organization is a qualified organization which has been created by a fraternal organization. A "fraternal organization" is defined as "a civic, service or charitable organization in this state, except a college or high school fraternity or sorority, not for pecuniary profit, which is a branch, lodge or chapter of a national or state organization and exists for the common business, brotherhood, or other interests of its members." Fraternal organizations are further restricted in their licensing ability by a limitation that only one charitable organization can be licensed by a fraternal organization. Finally, the Act imposes an existence test on all organizations which requires that an organization applying for a license must have existed in Illinois continuously for a period of five years immediately before making its application for a license. The only exception to this existence requirement is a reduction to two years if the organization applying for a license is affiliated with and chartered by a national organization which meets the five year requirement.

If the organization qualifies under the tests, the license obtained is subject to additional restrictions. The application must contain a sworn statement verifying the not-for-profit character of the organization signed by the presiding officer and secretary of the organization. In addition, the application must contain the name of the person who will be responsible for the conduct of the games. The license, when issued, will be restricted to the day of the week, hours and location at which the licensee is permitted to conduct games. The licensee is also required to file a copy of the license with the local police department or, in an unincorporated area, the sheriff's office of the county in which the' games are authorized. As with other state licenses, the Act requires

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display of the license in a "prominent place" on the premises where the games are conducted. Licensees are required to post a bond with the Department of Revenue for the benefit of the participants in the game to insure payment of the winners in the games. The amounts of the bonds to be required are to be established by rule of the Department of Revenue. A particular location for the games may only be used four times during the previous twelve months for charitable games. Finally, the licensee must consent to allowing Department of Revenue employees to be present during the conduct of the games and to inspect or test "equipment, devices and supplies used in the conduct of the game."

The second type of license authorized by the Act is a "Providers License." The Provider's License authorizes Illinois entities to provide premises for the conduct of charitable games. As with the organization license, the premises may not be used for more than four days per year. A provider is entitled to receive reasonable compensation for the use of the premises, however, the compensation cannot be based upon a percentage of the gross proceeds for the games. A licensed organization conducting charitable games is not required to obtain a provider's license if the games are to be conducted on the organization's premises.

The final type of license authorized by the Act is a "Supplier's License." This license authorizes the licensee to supply devices and equipment for the games. Suppliers are required to maintain records of the products sold for these purposes and of persons to whom the material was sold. As with the Provider's License, the compensation received by a supplier may not be based upon a percentage of the proceeds from charitable games. Organizations owning their own equipment may apply to the Department for an ownership permit. The organizations must then file an annual report giving their inventory of "charitable games equipment." Organizations are allowed under this permit to lend equipment to other licensed organizations, but may not receive compensation for use of the equipment.

Certain persons in organizations are ineligible for licensing under the Act. Any person who has been convicted of a felony within ten years of the date of application, who has been convicted of a violation of the gambling article of the Criminal Code, who has had a bingo or charitable games license revoked by the Department or "who is or has been a professional gambler" is ineligible for a license under the Act. An organization is ineligible for a license if any of its officers, directors or employees or persons involved in the management or operation of the games is otherwise ineligible for licensing under the Act.

After obtaining a license, the conduct of the games by the organization is subject to nineteen restrictions set forth in the Act. The entire proceeds of the games must be "exclusively devoted to the lawful purposes of the organization to conduct that game." Operation and management of the games is restricted to members, volunteers or employees of the sponsoring organization, however no person may receive compensation for participating in the management or operation of the game. An organization conducting games must establish a bank to convert currency into "chips, scrip or other form of play money" which may then be used to play the games of chance. No credit is allowed to be extended to any person playing the games and bets at single games may not exceed $5.00. At the conclusion of the event or when the player leaves, the Act authorizes cashing of the chips for currency not to exceed $250.00 or non-cash prizes. Participants in the games are required to sign a receipt for prizes and the licensee is required to report these prizes to the Department of Revenue. Licensees may not allow persons under the age of 18 to play or participate in any game, may not conduct games between the hours of midnight and noon, may not conduct games more than four days per year and may not allow the use of their premises for games more than four days per year including any games conducted by the organization. Operators of the games must provide written rule for the individual games such as roulette, blackjack, poker and others listed in the Act. Finally, no slot machines or "coin-in-the-slot" machines may be used.

In order to provide enforcement funds for the Act, the Legislature has established a fund to be administered by the Department. Licensees must pay three percent of the gross revenues of charitable games to the "Illinois Gaming Law Enforcement Fund." This fund is to be allocated among law-enforcement agencies throughout the State, the State Police and the Department of Revenue by a proportional formula to offset the additional costs of enforcing the Act. In addition to this "tax," all sales within the scope of the Act are subject to Sales Tax.

The Charitable Games Act imposes regulation and uniformity upon an area of fund-raising that had the potential for abuse. This Act should allow legitimate organizations to conduct profitable, well-run and enjoyable casino-nights.

II. REPORTING POLICE REPORTS
City of Monmouth v. The Galesburg Printing and Publishing Company, __ Ill. App. 3d __, ___ Ill. Dec. __ (3rd Dist., 1986)

In the June edition of this column, the case of The Copley Press v. The City of Springfield was discussed.

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At that time the Copley case was the only reported case interpreting the Illinois Freedom of Information Act (IFOIA). On June 17, 1986, the Third District Appellate Court rendered its opinion in the case of the City of Monmouth v. the Galesburg Printing and Publishing Company, the second reported case interpreting IFOIA.

This case bears a striking resemblance to the Copley case; the case arose out of a failure to release information by a municipal government; the primary legal issue is interpretation of the statute; and, a secondary legal issue is the potential violation of freedom of the press. Although the case resembles Copley in these respects, the case has a substantially different factual background and result.

Carol Clark is a reporter for the Galesburg Register Mail which is published by the defendant, Galesburg Printing and Publishing Company. After IFOIA took effect on July 1, 1984, the City of Monmouth refused to disclose to the Register Mail and Clark the identities of the victims of crimes occurring within the City. The City continued, in accordance with previous policy, to disclose the fact that a crime had occurred at a general location. Subsequent to the refusals to disclose, Clark requested, in writing, that the Monmouth Police Department supply her with additional information including the name, age, sex and address of crime victims. The City Clerk refused to release the information on the ground that the information was exempt from disclosure under Section 7(b)(v) of IFOIA. That Section provides that,

"The following shall be exempt from inspection and copying . . . Information which, if disclosed, would constitute an unreasonable invasion of privacy . . . Information exempted under this subsection (b) shall include but is not limited to: . . . information revealing the identity of persons who file complaints with or provide information to administrative, investigative, law enforcement or penal agencies."

Each denial to disclose by the City Clerk was affirmed by the Mayor of Monmouth during the statutorily mandated appeal process.

After 37 requests by Clark and 37 denials by the City, the City of Monmouth filed a complaint for a declaratory judgment and an injunction against Clark and the paper. The declaratory judgment complaint requested that the court declare that the identities of complainants and persons providing the Monmouth Police Department were per se exempt from disclosure. Additionally, the City requested that the court bar the defendants from making future requests for such information. The defendants responded that the statute was unconstitutional and that the statute did not intend a determination that all criminal complainants and informants were exempt from disclosure. The Circuit Court of Warren County held that the statute was not unconstitutional; the statute does not authorize a categorical determination of exemption and, the City is required to show each claim of exemption as a "clearly unwarranted invasion of privacy." With this holding the court dismissed, with prejudice, the complaint of the City.

On appeal the court was presented with three issues, two of these issues relate directly to IFOIA. The court clearly stated these issues. ". . . (1) Did the trial court interpret the statute correctly? (2) Does the statute violate the constitutional guarantees of freedom of the press? . . ."

In its review of the first issue, the court discussed the positions taken by the two sides. ". . . (T)he City interprets the statute as stating that, as to all persons in the category of informants and complainants, disclosure of identity would be an unwarranted invasion of privacy." "Defendants . . . argue that . . . an informant or complainant would be entitled to an exemption from disclosure if disclosure would constitute a clearly unwarranted invasion of personal privacy in that particular case." The court accepted the view and rationale of the defendants. In its rationale, the court stated that the interpretation of the statute by the defendants was consistent with the legislative policy stated in IFOIA.

"The statement of public policy and legislative intent indicates that the people's 'right to know' what the government is doing is a broad rule containing only limited exceptions, and the provisions of the Freedom of Information Act are to be construed accordingly. Courts called upon to interpret the Act, as we are, must be cognizant of the legislative intention that public access to information must be construed broadly and that exemptions to disclosure must be construed narrowly."

The second issue relating to the constitutionality of the statute yielded an interesting result. The court cited a United States Supreme Court case, Globe Newspaper Company v. Superior Court, in analyzing the constitutional issue. The Globe case dealt with a statute which closed certain trials involving minor witnesses to the press and public and applied a test of requiring the government to consider all such requests on a case-by-case basis. The court applied the test established in the Globe case, stating:

"The Illinois Freedom of Information Act as interpreted by the City was not narrowly tailored to serve a compelling governmental interest and,

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hence, would be unconstitutional if construed to give a blanket exemption from disclosure to all victims of crimes. Clearly, a case-by-case approach could be used to narrow the application of the state's interest in protecting persons whose right to privacy might be invaded without warrant. For example, where an informant's life could be endangered by revealing his or her identity, the City would be able to establish a justifiable right to privacy."

The decision of the appellate court in this case continues the interpretation of IFOIA by courts of review that was begun in the Copley case. The Federal Freedom of Information Act has been interpreted, limited, defined and expanded by hundreds of cases at the federal level. Illinois municipalities can expect that this same process will occur in Illinois for years to come. In the meantime, municipal officials must proceed with great care in disclosing, and more importantly withholding, information from the public and the press. •

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