Sweepstakes parlor owners hope to benefit from Cherokee deal
Posted November 29, 2011
RALEIGH, N.C. — As they battle to overturn a state ban on their video-style games, owners of Internet sweepstakes parlors are now eying a proposed casino deal between North Carolina and the Eastern Band of Cherokee Indians.
Gov. Beverly Perdue and tribal leaders finalized an agreement Monday that would allow live card dealers at the Harrah's Cherokee Casino and Hotel in the mountains in exchange for North Carolina school districts getting a piece of profits from the new games.
"We would also like for the legislature to look at our industry as well," Brian Henry, treasurer of the Internet Based Sweepstakes Organization, said Tuesday. "We would just like a seat at the table with our legislature to have our industry regulated and have it taxed."
Sweepstakes game operators have been seeking legitimacy from the state for years. A ban on the games took effect a year ago, following an earlier state ban on traditional video poker machines.
Operators argue that the games have predetermined outcomes that can pay off and that players are simply buying Internet or phone time – not gambling. Allowing people to click on computer screens to uncover potential prizes is a marketing tactic, they say.
The state Court of Appeals is now reviewing the sweepstakes ban after a Guilford County judge struck down part of the 2010 law as a violation of the First Amendment and a Wake County judge backed the entire law.
Owners of sweepstakes parlors have adjusted to the legal rulings by replacing casino games like slots and Pot-o-Gold machines with cartoon-style games.
"The new sweepstakes have adjusted their software to be compliant with the new laws," said Chase Brooks, president of the Internet Based Sweepstakes Organization.
Lawmakers are working with Perdue to schedule a special legislative session for the Cherokee gaming deal. Senate President Pro Tem Phil Berger said he expects the General Assembly will approve it.
"The legislature has the obligation in many instances to pick and choose," said Berger, R-Rockingham.
He has voted to ban sweepstakes games and video poker, and he said he's hesitant to deal with the industry again.
"I think it would be premature for us to deal with that until we get a ruling from the courts," he said.