Sweepstakes game ban now being enforced

By on January 3, 2013

A sign says State Line is closed for remodeling. (Sam Walker)

Following a December ruling by the state Supreme Court affirming a ban on Internet sweepstakes games in North Carolina, officials plan to begin enforcing the regulations.

The North Carolina Sherrif’s Association told members in December standard guidelines allowed enforcement to start Jan. 3.

More than a dozen of the sweepstakes businesses operate in Currituck County, most within two miles of the state line in Moyock, while several others are located in Elizabeth City.

“We are in the process of making notification via hand-delivered letter to all Internet Cafes and to all business owners who use the cafes as a secondary use that they must discontinue the operation of the internet machines at midnight tonight or face being prosecuted for continuing to operate,” Currituck County Sheriff Susan Johnson said in an e-mail Wednesday.

Dare County and some of its towns have adopted limits on the cafes to prevent the same kind of growth. Generally they call for the machines to be a secondary use in a business and strictly limit them to commercial and industrial districts.

Most have also charged a fee for each machine. Nags Head’s was set at $2,500.

Town Manager Cliff Ogburn said Wednesday that Nags Head will hold off enforcement until the issue plays out in the courts. Machines are at the Nags Head Bowling Center and a gas station and convenience store knowns as Miss Helen’s.

The bowling center closed down last year, and the gas station’s four machines were set to be shut down under a clause in the town’s amended ordinance. Since the store had the machines before the ordinance was changed, it was given two years to phase them out. The store is not under the allowable zoning.

The Supreme Court of North Carolina upheld the ban’s constitutionality last month, issuing opinions in cases filed by makers of the softwear used on the machines, and the operator of several gaming parlors in the Fayetteville area.

Several cafes have opened in Moyock near the state line to draw customers from Virginia, which has banned the machines, as well as local customers.

Users of the terminals pay for time on the Internet, primarily to use gaming sites. Proponents say winners are chosen randomly, much the same as lotteries or sweepstakes promotions by stores and product manufacturers. As such, the machines are not used for gambling, they argue.

Some communities have welcomed the opportunity to collect more taxes and fees.

In 2006, state lawmakers banned video poker machines, but programmers were able to circumvent the law.

The General Assembly updated the statute in 2010, but it has not been enforced while legal actions worked through state courts.

The high court denied a request to delay enforcement of the ban until the plaintiffs could file an appeal with the U.S. Supreme Court.

One Elizabeth City gaming parlor operator said he was reprogramming his machines to comply with the new regulations, but city manager Rich Olson said legal documentation would be required supporting that claim if they wanted to remain open.

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