Internet sweepstakes parlors may get the legal nod from the town of Cary. Town staff have drafted rules to explicitly allow and set rules for the “gambling lite” businesses, where patrons win and lose money playing virtual slot machines.
The town, like other governments across the state, is changing its laws months after a state court ruled the parlors legal. Town staff have fielded more than 20 calls in the last 10 weeks from prospective parlor owners while at least nine businesses host the gaming machines, according to town staff.
“We need to have something in the ordinance so that we can properly address them,” said town planner Mary Beerman.
The machines have long been a point of contention across the state, and the legislature banned them in 2010. The N.C. Court of Appeals struck down the law in March, making the parlors legal and difficult for towns to ban.
Sign Up and Save
Get six months of free digital access to The News & Observer
The N.C. Supreme Court could reverse the decision after oral arguments take place this fall, but for now governments are preparing for an influx of the businesses. Gov. Bev Perdue has called for new taxes on the businesses, while local governments are figuring out how to integrate the businesses.
The shops are able to host legal gambling because patrons aren’t actually playing a game of chance. Instead they are entering themselves into a sweepstakes with each pull of the virtual lever.
Under Cary’s proposed rules, the businesses could operate in most of the town’s general commercial districts. A sweepstakes business couldn’t operate within 500 feet of other gaming operations or residences, religious assemblies, day cares or schools. Shops, stores and restaurants, meanwhile, would be allowed to have no more than four of the machines.
The town currently has no specific rules for the parlor businesses, and staff have taken no recent action against the businesses. Existing sweepstakes parlors, Beerman said, could be required to comply with the new rules.
It’s unclear exactly how many sweepstakes machines operate around Cary– town staff can only say they know of about nine locations. But, if approved, the sweepstakes rules would give the local government better data on the industry. Each parlor would be required to get a town permit verifying that it abided by all the rules. Currently, only group care homes are required to get a “zoning compliance permit.”
The proposed rules still must pass several levels of official approval. The proposal could become law by September, if the Cary Town Council approves.
The town’s taking the same approach as governments across the state, according to David Owens, a professor at the University of North Carolina at Chapel Hill’s School of Government. Most of the new sweepstakes regulations limit the parlors to certain zoning districts.
Local governments have a well-defined legal right to limit the placement of the businesses, Owens said, but it’s less clear if a town could legally enforce a total ban on the gaming establishments.
The Cary board’s thoughts on the proposal aren’t clear yet. Councilwoman Jennifer Robinson and Mayor Harold Weinbrecht said they’re still looking into the proposal, while Councilman Don Frantz said the town should accede to the industry’s legality.
“I think we need to treat any and all businesses within the rights they are afforded under the law,” he said.