Sweepstakes Gambling Ban Advances

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Sweepstakes Gambling Ban Advances

Special Report - July 7, 2010
Yesterday evening, the House Judiciary I committee overwhelming recommended approval of an enhanced ban on video gambling in North Carolina. HB 80—Ban Electronic Sweepstakes is scheduled for final consideration by the full House today. If passed, HB 80 will go to Governor Perdue for her signature. The bill seeks to clarify that the state’s existing ban on video gambling applies to a new breed of gambling known as Internet sweepstakes cafes or parlors, where customers purchase phone or Internet time to gain access to games of chance. Various court rulings have placed the legality of the games in question over the last year, which has led to a proliferation of sweepstakes cafes and parlors, which in turn prompted legislative action. The bill also clarifies several provisions in the State's video gambling machine law.

The House Judiciary I committee considered both HB 80, which would completely outlaw such video gambling, as well as HB 2030—Video Gaming Entertainment Act, which would legalize video gambling in order to regulate and tax it through the Department of Revenue. The committee debated the two bills for nearly an hour and a half. While Rep. Kelly Alexander (D–Mecklenburg), bill sponsor for HB 2030, argued that his bill was “a revenue bill that deals with a sweepstakes, which right now is not technically gambling,” Rep. Ray Rapp (D–Madison) argued that these sweepstakes machines and games “look like traditional video poker. They play exactly the same.” He equated the legislature’s actions in 2006, 2008, and now 2010 to ban video poker to playing “whack-a-mole” with a morphing industry, emphasizing that “its time to put an end to it.” A number of committee members argued that if the activity “looks like a duck, waddles like a duck, quacks like a duck,” then “it is a duck,” and should therefore be outlawed under the state’s ban on video gambling. Rep. Alexander argued that taxing and regulating the industry would help to plug the inevitable budget hole the state will face in 2011.

Rep. Grier Martin (D–Wake) and Rep. Verla Insko (D–Orange) both expressed particular concern about the addictive nature of the games. Rep. Martin sees the new video gambling as merely a “shifted nature … that still used all the things that still stimulate your brain and take advantage of you the same way video poker does.” He argued, “this is already illegal.” Rep. Insko stated, “addiction disease is really the same whether it’s alcohol or a drug, and it makes changes in the brain” that lead a person to make poor and irrational decisions. According to Rep. Rapp, the North Carolina Council on Problem Gambling reports that every gamblers’ anonymous group in North Carolina has seen a 75 to 100 percent increase in gambling addictions since February 2009. Such numbers demonstrate to him “there’s a sense of clear exploitation that’s going on with these games.” He went on to remind the committee of “those families that are hurt so negatively by some compulsive gambler … who leaves his money [at the parlor or café],” thereby leaving his or her family “without food and clothing.”

At the conclusion of the discussion, Rep. Paul Stam (R–Wake), made a motion that the House concurr with the Senate version of House Bill 80. The motion passed.