Internet café stand-off: Senate committee passes regulation, House and Scott want shut-downby Dara Kam | January 19th, 2012
An Internet café showdown is shaping up after a Senate committee overwhelmingly approved a measure that would regulate the “casinos-on-corner” shortly before the sponsor of a proposal that would shut them down withdrew his bill from consideration.
The Senate Regulated Industries Committee signed off on the regulation of the cafés (SB 380) after hearing from proponents who said the facilities provide up to 13,000 jobs and are a place for seniors to socialize.
“We have never had one, eensy-teensy, bit of crime,” said Julie Slattery, who owns two Internet cafés in Melbourne.
“This is a business. It’s a real business. It’s a form of entertainment,” Slattery said. She asked the committee to regulate rather than shut the locales to “get rid of whatever it is you’re afraid of.”
But prosecutors and the Florida Sheriffs’ Association objected that the cafés are a venue for crimes and illegal gambling and need to be shuttered.
Sen. Miguel Diaz de la Portilla, the bill’s sponsor, rejected those arguments, noting that prosecutions have not resulted in a single conviction.
“I guess there’s a shortage of real crime out there so there’s a need to create some more so you can go prosecute it,” Diaz de la Portilla, R-Miami, said, adding that traffic problems and robberies often take place at convenience stores.
“Should the next bill ban convenience stores, too?” he said.
After passing the regulatory measure by an 8-1 vote, the committee then took up a bill (SB 428) that would outlaw the facilities. That proposal is similar to one passed by a House committee earlier this week and mirrors the criminalization Gov. Rick Scott yesterday said he’d like lawmakers to impose.
But before the committee could vote on his bill, Sen. Steve Oelrich asked the committee to temporarily put it aside, fending off the panel possibly killing the measure. That would have put an end to the possibility of outlawing the cafés for the rest of the session.
It is unknown how many of the cafés are now operating in Florida, but estimates range from 800 to 1,200. And it’s uncertain how many employees work at the cafés. Opponents say there are as few as one worker per facility while one owner told the committee this morning she has 15 employees at her two Melbourne storefronts. A recent study by Florida State University’s Center for Economic Forecasting and Analysis estimates an average 13 workers at each location and that the industry generates up to $750 million a year in sales.
The cafés operate under the state’s “sweepstakes” laws, which critics say were created to regulate giveaways by companies like Coca-Cola and MacDonald’s. Café customers purchase Internet time, which they can use to browse the Web or play free “sweepstakes” games, in which computer credit or time is won. Those credits can be redeemed for cash.
Authorities are now able to prosecute the facilities under state laws governing slot machines, said Joe Cocchiarella, who works for the state attorney in Orange and Osceola counties. No cafés now exist in that region, Cocchiarella told the committee.
“We’ve prosecuted them. They’re closed,” he said.
But after intense questioning from Diaz de la Portilla, Cocchiarella conceded none of the operators had been convicted but that at least one had agreed to a settlement, forfeited $85,000 and left town.
Regulating the cafés will “bring some clarity, eliminate the marginal players and allow people to exercise their free will and free enterprise,” Diaz de la Portilla said.
Under his proposal, café operators will have to pay a $100 fee per terminal, an estimated $4 million for the state. Counties and municipalities would be able to impose additional fees and regulations or outright bans, as Palm Beach County recently imposed on new locations in unincorporated areas.
Oelrich said he knew he didn’t have the votes to get his bill passed and asked the committee to put it on hold to keep it afloat. He said he did not know what his next move would be.
“These establishments are couched as being friendly to veterans’ groups and charitable groups and I think nothing could be further from the truth,” said Oelrich, R-Cross City. “They’re a bane on our community and I don’t think they’re very healthy for the state of Florida. Why don’t we just face the facts? The idea that we’re going to through regulation give blessing to 1,400 more gambling establishments in the state of Florida is ludicrous.”