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Published: 2010-05-12 18:26:00
Updated: 2010-05-12 18:59:29

Study: Sweepstakes cafés could net N.C. millions


Sweepstakes cafe machine
Sweepstakes cafe machine
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As state lawmakers are weighing their options for closing a budget deficit of nearly $800 million, some are exploring taxing the wave of gaming parlors that have opened statewide in recent months.

The so-called sweepstakes cafés, which are sprouting up in strip shopping centers across North Carolina, sell players blocks of time to play games of chance on computers or cell phones. The odds are long, but players who win can get a cash payout.

Although opponents have compared the computer terminals in the sweepstakes cafés to video poker, recent court rulings have determined the businesses are legal.

Sen. David Hoyle, D-Gaston, said Wednesday that the state should consider regulating and taxing the gaming parlors.

"If it's a revenue source of any significant consequence, maybe it's something we have to look at," Hoyle said.

The gaming industry wants state regulation and revenue sharing, but private business owners have said they don't want the lottery to run their operations.

Hoyle asked Tom Shaheen, director of the North Carolina Education Lottery, to analyze the impact of having the state regulate "video lottery terminals" in the sweepstakes cafés. WRAL Investigates obtained Shaheen's report, in which he estimates North Carolina could net $350 million the first year and $576 million by the fourth year.

In West Virginia, which has regulated such video terminals for years, they account for 88 percent of the state's nearly $1.5 billion in annual lottery proceeds. In that state, though, the video games are allowed only at race tracks and places with liquor licenses.

"To pay some of those games, you probably need to be drunk to do it, because you're not going to win," Hoyle said.

Sweepstakes café opponents in the General Assembly said they have enough votes to ban the businesses this legislative session.

"We need to make a statement once and for all, not provide anymore loopholes for folks to get around and simply stop it," said Rep. Ray Rapp, D-Madison.

Meanwhile, some communities are so riled up over what they consider legalized gambling that they've taken various steps to regulate it.

Apex and Holly Springs leaders recently approved zoning rules to classify sweepstakes cafés as "adult businesses," similar to strip clubs. The rules restrict the businesses to industrial zones and limit their hours of operation.

"We decided that wasn't appropriate for Apex," Mayor Keith Weatherly said. "We restricted them as much as we can. We can't outlaw them. We can't forbid them to be in Apex, but we tightened up as much as we could."


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Interesting how a politician will sell his or her sole for a buck. If you support this bunch ya might get the chance to meet them again.

I don't want it in my state. Tell your state representatives to put their greedy tongues back in their mouths and shut this stuff down now.

you cannot legislate morality!! People are going to do what they are going to do anyway. For those who wish to endulge in any legal form of gaming, it truely is their own business. I think the state could benefit from this if they are smart enough to keep overhead low and not do with this what they did with the liquor boards!!! I'm for anything that will not take my pay back to balance the state budget!!!!

Suurrrre - Let the state take taxes from these and you know it won't have any effect on the taxpayer. Only those who profit from this are the same ones who overspend on stupid committees (someones pocket) and cut from schools. Who do they think they are fooling? Not I.

Most seem to understand that the state will have to hire hundreds more state employees if this is approved. Government needs to get smaller, not larger. Eventually everyone will be working for the government. Who will pay their salaries?

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