Cary News

Sweepstakes fees under review in Morrisville

There are no sweepstakes parlors in Morrisville, but that could change.

The town has had several inquiries in the past year, said Planning Director Ben Hitchings. But applicants have been turned away because Internet cafes and sweepstakes parlors aren’t an allowable use.

In March, the state Court of Appeals ruled a state ban on sweepstakes parlors was unconstitutional.

The ruling is set to be appealed, but in the meantime towns such as Morrisville and Garner are revisiting their privilege license fees to address the issue.

As part of the budget the town is looking to create fees for the first time. Morrisville Mayor Jackie Holcombe has asked staff to review a proposed fee of $2,500 per location and $1,000 per additional machine with an $5,000 maximum.

“I don’t want Internet cafes in Morrisville,” Holcombe said. “(But if they are going to come) then I want them to bring in a boatload of revenue.”

She asked if it was possible to remove the $5,000 maximum at a council meeting earlier this month.

Other municipalities charge higher fees or set higher limits.

In Raleigh, the parlors pay $3,500 for the first terminal and $1,000 per additional terminal, up to $20,000. Cary charges the parlors $2,500 up front and $1,000 per machine, up to $5,000. In Clayton, the initial fee is $2,500, plus $350 per terminal.

Garner has no privilege fee and currently charges a $35 business license. Garner officials are considering charging a one-time fee and fee per terminal. It might also prohibit the parlors from opening near each other, schools, churches, parks and liquor stores.

Sweepstakes games work by charging patrons for Internet time which includes a chance to win. A jackpot steadily builds and can pay out at any time.

Morrisville’s town attorney Frank Gray said caution was needed, because the courts are still debating local governments’ right to impose the higher fees.

Two lawsuits filed by Fayetteville-based attorney Lonnie Player are working their way through the state appeals system. The suits contest the fees citing the practice violates the “rule of uniformity” by raising the fees on certain type of businesses and property.

The fees will be part of Morrisville’s budget which must be approved by June 30. A public hearing on the budget is scheduled for June 12.