Poker chips rattle and cards fold when the Cops Care Cancer Foundation visits Nevada.

The nonprofit organization, which provides financial assistance to children with cancer, held one charity poker tournament in San Jose and planned another. Problem was, organizers learned the event would have broken California law -- so they moved it to Lake Tahoe.

Casino events, although potentially lucrative fundraisers, are illegal in California.

With the rising popularity of Texas Hold 'em and other casino games, it's not surprising charity organizations have embraced the trend. Casino night fundraisers offer an entertaining and profitable alternative to raffles and bake sales.

"All nonprofit groups use traditional fundraising methods," said Brian Simuro, founder of the San Jose-based Cops Care Cancer Foundation. "It's very hard for the charity to make money when every other charity is doing those types of events."

So why not a poker night?

The Legislature is poised to provide the answer, perhaps as early as Jan. 1, if a bill that passed the Assembly on Thursday and the Senate earlier this week is signed by Gov. Arnold Schwarzenegger.

AB839, by Assemblyman Alberto Torrico, D-Newark, would allow nonprofit organizations to hold one casino fundraiser each year. The measure contains numerous controls, including a ban on cash awards and a $5,000 limit on the value of prizes.

For many nonprofits, the fact that casino night fundraisers are currently illegal is likely news. Many aren't aware of the law, but those that ask get a polite, but firm response from law enforcement: No dice.

In Ventura County, the District Attorney's Office receives periodic inquiries from nonprofit organizations interested in holding casino fundraisers, said Greg Brose, supervising attorney for the Consumer and Environmental Protection Unit.

Brose informs these organizations that Attorney General Bill Lockyer, the sponsor of Torrico's legislation, has deemed casino fundraisers illegal. He advises the organizations to contact their legislators about AB839 if they'd like the authority to legally conduct casino-night events.

Brose said his office is not aware of any nonprofits that hold casino fundraisers, although these events do occur in Ventura County. The office does not go out of its way to track down violators and has no set procedure for handling violations.

"It would depend upon whether or not we have had consumer complaints," said Brose. "Law enforcement concerns would also be a factor."

Most nonprofits unaware

Tom Dressler, a spokesman for Lockyer, agrees that nonprofits holding gambling fundraisers are generally not aware they are violating the law.

"Law enforcement didn't have any desire to send the jackboots to these fundraisers to bust them up. We thought it made much more sense to change the law so this type of fundraising could continue with appropriate safeguards," he said.

Opponents argue that even with safeguards in place, the potential for abuse exists.

"We see that (casino fundraisers) as an expansion of gambling and consequently we oppose it," said the Rev. James Butler, executive director of the California Coalition Against Gambling Expansion.

Fred Jones, the group's legislative advocate, and Butler point to a recent California Research Bureau report, Gambling in the Golden State, which estimates 1.5 million Californians are problem or pathological gamblers.

"We find it ironic that some of these nonprofits probably respond to people with these problems," Butler said.

While supporters do not consider casino fundraisers gambling, Jones disagrees. Participants are competing for prizes with a monetary value.

"It's gambling, however they want to slice it," he said. "At the very least, they are promoting the gambling culture."

Business owner dissents

Jim Yates, owner of Casino Del Sol Entertainment in Encinitas, disagrees. His company creates casino-style events for professional and private parties.

"Our industry, basically, has nothing to do with gambling, period," Yates said. "We are strictly ¿faux-gaming.' The guests have nothing at risk. It's free. And we don't come under the gambling laws unless we play for real money."

Casino Del Sol, however, is a member of a committee of casino party providers that opposes AB839. These operators believe the bill addresses legalized gambling under the umbrella of a fundraiser, leaving the party providers' services in a gray area.

The attorney general interprets anyone other than a licensed gaming establishment holding controlled games to be in violation of state law. State law defines a "controlled game" as any card, dice or domino game "played for currency, check, credit or any other thing of value."

This interpretation deems casino-style parties illegal, even though party providers say they fail to meet the criteria for controlled games because the players' chips are later exchanged for tickets to a raffle in which prizes are awarded by lottery.

The attorney general disagrees, and in the winter of 2005 shut down several party providers.

"The party providers are just basically mom-and-pop businesses," said Larry Leal, certified fundraising manager and member of the party provider committee. "They are just small-business providers. Those are the events the Attorney General's Office is shutting down."

Similar to raffle law

The California Association of Nonprofits supports the bill, noting it is modeled after a 2001 law that permitted charitable groups to conduct raffles.

In a 2003 report to the Legislature, the Department of Justice concluded the raffle law has been successful in preventing abuse. The study reports that only 20 complaints of misconduct were received over a two-year period, 16 of which were resolved without the need for law enforcement intervention.

"A looser law with a similar matter has demonstrated pretty good results," said Ken Larsen, director of public policy for the association. "We don't anticipate different results with this bill."

In addition to prohibiting cash prizes and wagers, AB839 would limit each nonprofit to conduct one casino fundraiser per year. The bill allows only four fundraisers at the same location and limits each fundraiser to no more than five consecutive hours. The Division of Gambling Control would have to previously approve each fundraiser.

The bill would allow individual prizes that do not exceed a cash value of $500. The total cash value of prizes for each event could not exceed $5,000. Nonprofits are encouraged to acquire prizes that have been donated to the organization.

Bill establishes percentages

The proposed law would require 90 percent of casino-night proceeds be used to further the mission of the nonprofit. No more than 10 percent could be used to cover the costs of conducting the fundraiser, not counting the cost of renting a facility.

"This bill strikes a careful balance by allowing nonprofits to host ¿poker night' fundraisers while imposing strict limits on the number of events that can be held and the value of prizes that can be awarded," Torrico said in a statement.

The desire for preventive safeguards is widespread.

"We do fully, 100 percent, believe that it does need to be regulated," said Simuro of the Cops Care Cancer Foundation.

Simuro disagrees with the argument put forth by Indian gaming tribes that charity casino events will introduce unfair competition in the gambling sphere. "We have found that the people who would go to an Indian casino are not the people who come to our events," said Simuro. "These are people who want to support charity. These are not card-playing die-hards."