General Assembly Gives OK To Video-Poker Machine Phase-Out

RALEIGH, N.C. — The General Assembly approved Monday a bill to ban video-poker machines by next summer, a decision stalled for years as the House and Senate disagreed whether losing industry jobs was worth a complete prohibition.

The Senate voted 44-1 to accept a House plan approved last week that would slowly reduce the number of machines any retailer could operate or distributor set up at one location from three to none by July 1, 2007. The Senate had approved an immediate ban five times since 2000, but decided to accept the compromise rather than risk another stalemate this year.

The measure now goes to Gov. Mike Easley, who will sign it into law, a spokeswoman said.

The Senate's main proponent of a ban told fellow senators during the brief debate that the bill's passage exemplified how perseverance can pay off.

"If you have a cause that you believe in, stick with it," said Sen. Charlie Albertson, D-Duplin. "And if it's a good cause, it will be successful."

The lone no vote was cast by Sen. Hugh Webster, R-Alamance, who said the ban essentially takes property away from machine owners.

"It is not a good idea to deprive people of property without compensating them for it," Webster said.

Passage also represents a reverse course for House Speaker Jim Black, D-Mecklenburg, who agreed to the phase-out after blocking Senate overtures on the issue for years.

Black, one of the largest recipients of industry campaign donations, said video poker was a legal business that had created thousands of jobs among distributors, convenience store clerks and machine repairmen and shouldn't be eliminated. But he agreed to the phase-out after months of media reports about his link to state and federal probes of the video poker industry's practices and political donations.

The decision will end North Carolina's 13-year experiment with video poker machines. The General Assembly restricted them further in 2000 after South Carolina banned the machines and authorities worried those games would move across the border.

Lawmakers at that time agreed to a three-machine limit at any one locations for fears of permitting video poker parlors. Machines had to be registered with sheriffs and couldn't be replaced once they broke down. Payouts were limited to $10 in merchandise.

Under the bill heading to Easley's desk, the number of machines at any location would be reduced to two by Oct. 1, one by March 1 and zero on July 1, 2007. Repeat offenders or those caught with five or more machines would be guilty of a felony.

The speaker and other phase-out proponents said it would give industry officials time to sell machines and convenience store owners to start selling tickets from the new state lottery to make up for lost revenue.

The final bill would retain an exception for video gambling machines at the casino run by the Eastern Band of Cherokee Indians.

Sheriffs estimate there are about 10,000 legal machines but about twice as many illegal machines that are difficult to track down and offer large cash payouts.

A consulting firm hired by the poker machine industry said earlier this month that the legal machines are directly responsible for 1,752 jobs and more than $100 million for the state economy.

Industry officials have complained that unlawful machines are the problem, and Black had sought even tougher restrictions and giving authority over machine regulation to Alcohol Law Enforcement agents.

Donald Stepp, who owns about a dozen video poker machines along with pool tables and other amusement games in Lexington, questioned why the government would eliminate so many jobs.

"We may have to shut the business down," said Stepp, adding that he may have to sell his machines to operators in other states. "I don't see how they should be able to ban a legal business that's paying taxes."

But sheriffs statewide have complained legal machines were hard enough to monitor under the 2000 law, let alone the illegal ones. Scores of illegal machines have been confiscated over the years.

The ban "removes a great burden off local sheriffs, so they can concentrate on fighting crime and protecting people in their communities," Attorney General Roy Cooper said.