Bills Would Regulate Video Gambling

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Bills Would Regulate Video Gambling

Special Report - June 1, 2010
Two bills were filed in the North Carolina General Assembly last week to legalize and regulate video gambling in the State. HB 2030—Video Gaming Entertainment Act, filed by Rep. Kelly Alexander (D–Mecklenburg), and SB 1407—Lottery Commission Regulate Video Gaming, filed by Sen. Julia Boseman (D–New Hanover), differ most notably in which state agency would regulate video poker. HB 2030 would place the Department of Revenue in charge of the regulation and enforcement of legalized video gambling, while SB 1407 would give that authority to the North Carolina State Lottery Commission.

Interestingly, HB 2030 would maintain the current prohibition on video gaming, but would allow simulated games of chance, defined as “A computer-based game in which the player entries that will result in the awarding of further game credits, cash, or prizes have been determined prior to play,” on video gaming machines, defined as “A computer terminal or any other video display device that is used to reveal sweepstakes entries, or play simulated games of chance and rewards players with either further game credits, cash, or prizes.” SB 1407 would legalize those forms of video gambling currently banned. Both bills would require each legal video gambling machine to display “A permanently affixed tag or other device” as a permit.

Additionally, both bills would require licensed operators to be a resident of North Carolina for at least three years, to be over the age of 21, to be current on their taxes, and to not have any felony or gambling offense convictions within 10 years. Licensed establishments cannot “be engaged exclusively in the business of housing video gaming machines.” No more than 10 video gambling machines would be allowed in a single establishment, players would have to be at least 18-years old, and could not wager more than $5.00 at a time. Neither bill would allow video gambling operations “within 50 feet of a church, public school, or any nonpublic school.” The House bill would allow only “one licensed establishment per single roofline.” The Senate bill would require establishments to possess “an on-premises malt beverage permit, on-premises unfortified or fortified wine permit, or mixed beverages permit” in an effort to limit underage exposure. Under either bill, applicants would pay “an annual fee of five thousand dollars ($5,000)” for an operator’s license, and “an annual fee of two hundred fifty dollars ($250.00) per video gaming machine.”

The Senate bill would divide the state’s net revenue from the proposed regulation in the following manner:

40 percent “to support a vocation training program for one high school in each local educational authority.
40 percent “to supplement existing funding for school nutrition programs.”
20 percent “to the Public School Building Capital Fund.”

Opponents of legalizing video gambling in North Carolina expect a bill to be filed soon that would clarify the current ban to include sweepstakes parlors and Internet cafes, which have been spreading around the state, much to the dismay of citizens and local municipalities. See our previous stories here, and here for more information on those.

“Nothing good can come from expanding gambling in North Carolina,” said Bill Brooks, president of the North Carolina Family Policy Council. “Rather than succumbing to the incessant pressure of the gambling industry to duck and weave through loopholes in North Carolina’s laws, the legislature must act swiftly and decisively to amend the statutes in such a way that courts will be unable to turn a blind eye to such blatant efforts by the gambling industry to spread the plethora of social ills associated with this so-called ‘crack cocaine’ of gambling throughout North Carolina.”