A brief history
Video gambling became an entrenched part of South Carolina's makeup during the 1990s. At its height, the $2.8 billion-a-year industry had about 36,000 video poker machines in 7,000 locations around the state, including arcades, gas stations and convenience stores.The games, which resembled the slot machines found in full-scale casinos, featured dollar-in credits, and players could win or lose hundreds of dollars a day playing games controlled by computer chip.The death of the industry came after the S.C. Supreme Court in 1999 issued a 5-0 decision that essentially outlawed the games as of July 1, 2000. The court stunned gaming backers by declaring as unconstitutional a statewide referendum held on legalizing the games, saying the General Assembly did not have the power to delegate its authority to make laws directly to the voters.The decision also turned the tables on video-gaming advocates by upholding the portion of the law that said the industry would be out of business by July 1 if it ever failed to get the voters' endorsement. Since that time, various attempts have been made to bring the games back into the state, so far without success.
Walk into some of the Internet cafes sprouting around Charleston, and you'd think you are stepping back into South Carolina's long-gone days of video poker.
Rows of computer monitors line the floor, and brightly lit video screens invite players to test their skills playing games dubbed "Joker Poker" and "Clover Fields."
Instead of payouts, you get a chance to win "sweepstakes," and operators tell you the proceeds go to charities. Charleston City Council, however, wants to know more.
This week council took a first step toward controlling the spread of the cafes, passing the first-reading of an ordinance declaring a six-month moratorium on zoning, permits or licenses for Internet-cafe-type start-ups.
That includes arcades and game rooms where "simulated gambling devices" might operate.
Councilman Aubrey Alexander raised the concern about the spread, saying he doesn't know enough about them or how they operate to gauge the effects they might be having on the community.
"Let's take the time to understand what we're dealing with," he said. Several local commercial real estate operators have raised questions about the sites as well, he said.
Two such Internet businesses currently are licensed in the city limits, both at West Ashley strip malls. Both cafes are grandfathered in under Alexander's moratorium proposal and can continue to operate. Applications for new startups are pending, city officials said.
About a decade ago, South Carolina was dominated by video poker. The industry was a cash cow for the state, bringing in millions of dollars in taxes and fees every year, until the games were banned in 2000.
When the machines went dark, more than 36,000 video poker devices were left in 7,000 locations.
Since then, various attempts have been made to bring the games back under new alterations, without success. The rise of Internet cafes, offering an array of off-site log-on games, is a more recent phenomenon.
The two businesses operating in Charleston are the Coffee Cafe on Savannah Highway, near George's sports bar, and what an employee identified as the two-month-old Charleston Donation Center, in the Food Lion shopping center on Highway 61. It does not have an outside sign above the door.
Both operations feature rows of office chairs seated in front of keyboards, mice and monitors displaying an array of video games where players can sit for hours.
A sign on the wall in the Donation Center tells players "you are not gambling," but that the cash users turn over to play the various games enters them into a "sweepstakes." A signboard on the wall this week at the Donation Center listed one sweepstakes jackpot of $558.23 for anyone matching "three 7s."
A children's ranch and an autism program are listed on signs inside the operation as benefactors. On Thursday afternoon, one player said she liked the Lancelot game, and that her best day of play brought her $45 in walking-away money.
At the Coffee Cafe, owner Patty Johnson said she is still looking for a charity to partner with, pointing to a disabled center in Mount Pleasant as one group.
She said she is selling a legal service of Internet time and that patrons can log on to check email or search the Web if they don't want to play the games on the screens. She declined to answer other questions, referring inquiries to her lawyer, who did not return phone messages left over two days this week.
Kathryn Richardson, spokeswoman for the State Law Enforcement Division, a lead agency in monitoring gambling in the state, also did not respond to phone messages seeking comment on the rise of Internet games.
Charleston Police Chief Greg Mullen said the moratorium allows the department to investigate the potential nuisance factor or other negative offshoots behind an industry that "all of a sudden popped up" here.
Part of that research will include reaching out to see how other states have handled cafes, he said, including site-specific zoning.
At least two other jurisdictions in the state have had issues over similar operations in recent months, according to published reports.
Alexander said the city needs the moratorium to preserve what he called the "status quo," and to create time to deal with an unknown.
"I'm not here to stop anything," Alexander said. "I'm just here to ask the question."
Charleston's moratorium ordinance is targeted at businesses that make available electronic access to a "simulated gambling device."By definition in the ordinance, "device" is defined as any mechanical or electrical contrivance, computer, terminal, video or other equipment that may or may not be capable of downloading games from a central server system, machine, computer or other device or equipment.
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