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Federal judge refuses to block Internet cafe ban

Tuesday, June 4th, 2013 by Dara Kam

A federal judge on Tuesday refused to block a ban on Internet cafes sought by senior arcade owners, who say they’ve unfairly been lumped in with the predatory storefront casinos.

Lawyers for Broward County adult arcades Boardwalk Brothers, Inc., and Play It Again FLA, LLC, claimed the law is unconstitutional in part because it is vague and arbitrary and denied seniors who gamble at the arcades their First Amendment rights of association.

The plaintiffs failed to show how the law would prevent seniors from gathering someplace else, U.S. District Judge James Cohn wrote in a 19-page order.

“Moreover, there is no evidence before the Court that enforcement of the statute would force Plaintiffs out of business and prevent patrons from associating at their establishments. Instead, the statute merely limits the types of games that might be offered. And even if the statute did force Plaintiffs out of business, no citizen enjoys a constitutional right to play amusement games,” he wrote.

Cohn did not rule on the merits of the law hurriedly passed by the Legislature in response to a multi-state gambling sting in April.

Gov. Rick Scott signed the bill on April 10, less than a month after state and federal authorities arrested 57 people in connection with Allied Veterans of the World, a St. Augustine-based nonprofit accused of posing as a charity while running a $300 million illegal gambling ring. The gambling bust also prompted former Lt. Gov. Jennifer Carroll to resign. Carroll had worked as a consultant for Allied Veterans while a member of the Florida House.

The arcades also failed to convince Cohn that the statute goes too far. The “state has a significant interest in proscribing the behavior regulated in the statute” and “an important public interest in limiting gambling and preventing minors from gambling.”

Seniors from Palm Beach and St. Lucie counties traveled to Tallahassee to plead with lawmakers to spare the gambling establishments, arguing that the centers offer relatively inexpensive entertainment and spare them from being lonely.

Slot machine-like games outlawed after Scott signs Internet cafe ban

Wednesday, April 10th, 2013 by Dara Kam

Slot-like machines in storefront gaming centers became illegal today after Gov. Rick Scott quietly signed into law aimed at shutting down Internet cafes.

Scott signed the bill less than a month after state and federal authorities arrested 57 people in connection with Allied Veterans of the World, a St. Augustine-based non-profit accused of posing as a charity while running a $300 million illegal gambling ring.

The investigation also prompted Jennifer Carroll, Scott’s hand-picked running mate, to resign as lieutenant governor. Carroll had consulted for Allied Veterans while she was a member of the House.

Scott signed the bill (HB 155) without any fanfare and spoke with reporters shortly afterward, quickly shifting the conversation to a plug for his two legislative priorities.

“The House and the Senate did the right thing to crack down illegal gaming especially in light of the Allied Veterans multi-state criminal conspiracy. They did the right thing and now they can get back to working on my two priorities for the session, the $2,500 pay raise across the board for classroom teachers and eliminating the sales tax on manufacturing equipment so we have more jobs,” Scott said.

Lawmakers have not yet signed off on either of Scott’s legislative goals.

The new law could disrupt gambling at the senior arcades popular with the elderly in Palm Beach County because many of the machines at the centers would be outlawed.

Internet café and arcade operators say the ban could put up to 16,000 people out of work.

Scott, who campaigned on creating 700,000 jobs in seven years, called the ban “the right thing” and turned a question about the new law’s impact on workers into another plug for his priorities.

“I have a jobs agenda. Right now what the House and Senate need to be focused on is getting rid of the sales tax on manufacturing equipment. It will create more manufacturing jobs. We have less than half the number of manufacturing jobs per capita than the rest of the country,” Scott said. The tax break would eliminate sales tax on manufacturing equipment and is expected to eliminate nearly $60 million from the state treasury the first year it goes into effect and $115 million the following year. There is no estimate on how many jobs, if any, the tax break would create.

Senate Dems put brakes on Internet cafe ban…almost

Thursday, April 4th, 2013 by Dara Kam

UPDATE: Senate Democrats won’t block the Internet cafe ban from rolling over, after all. The caucus never took a formal vote and several members were absent during a discussion.

Senate Democrats had intended to put the brakes on an Internet café ban that would also shut down “senior arcades” popular with elderly residents in Palm Beach County.

Sen. John Thrasher had hoped to get a floor vote on his bill (SB 1030) today. But the Democratic caucus, with the support of two Palm Beach County senators, balked at rushing the measure through instead of allowing the normal procedure to take place. “Rolling over” a bill to third reading for passage requires a two-thirds majority, or 27 votes, meaning that Republicans need the support of at least one of the 14 Senate Democrats. Despite concerns about the measure, the Democrats aren’t expected to block it from moving forward.

The House last month passed a similar version just 10 days after authorities accused Allied Veterans of the World of running a $300 million illegal gambling ring posing as a veterans’ charity.

The multi-state sting also prompted Lt. Gov. Jennifer Carroll, who was a consultant for Allied Veterans during her time in the Florida House, to resign on March 12.

Sen. Oscar Braynon called Legislature’s rush to pass the bills “a knee-jerk reaction to a federal investigation.”

A delay would have given the senior arcades, who have launched an all-out assault in an effort to get lawmakers to exempt their industry from the all-out ban, until next week to try to drum up more support. On Tuesday, the Florida Arcade and Bingo Association bused around 80 seniors, some in wheelchairs and using canes, from Palm Beach and St. Lucie counties to the Capitol to attend a committee meeting. The elderly patrons made impassioned pleas save the centers that cater to the elderly and where the customers play electronic games that resemble slot machines.

“There’s great concerns in the senior community in Palm Beach County. Quite frankly, if the adult arcades are not taken out of it, I may not be supporting the bill whatsoever,” Sen. Joe Abruzzo, D-Wellington, said during a Senate Democratic Caucus meeting this afternoon shortly before the session began at 2 p.m.

Supporters of the Internet cafes contend that shuttering the storefront gaming centers will put 13,000 people out of work. Two committees took testimony on the measure before it reached the floor today.

“There’s statistics being floated around. I’d like to found out if they’re true, that in one fell swoop 13,000 people, minimum, are going to be out of a job. This has reaching implications for this legislation. I may support it. I may not. But when that many jobs are at stake, that big of an economic impact, allegations being made all different which ways, we need to have this aired out in the open,” Abruzzo said.

Storefront gaming ban headed to Senate floor

Tuesday, April 2nd, 2013 by Dara Kam

Delray Beach sisters Anita Silverman and Tobie Berg

A proposed ban on Internet cafes that would also shutter adult arcades is headed to the Senate floor for a vote as early as Tuesday over the objections of dozens of seniors who traveled from Palm Beach and St. Lucie counties to plead with lawmakers to leave them alone.

The proposed ban, already passed by the Florida House, is a swift reaction to a a multi-state sting last month that resulted in 57 arrests and prompted Jennifer Carroll to resign as lieutenant governor. Authorities accused Allied Veterans of the World, a charitable organization Carroll consulted for while a state representative, of racketeering and money laundering charges associated with operating a $300 million illegal gambling ring.
The proposal would ban slot machine-like games at storefront gaming centers, including those that cater to seniors who testified Tuesday morning that they spend hours playing the games for as little as $20.

And, the seniors and arcade operators said, the amusement centers give them a place to and people to hang out with instead of spending their days – and nights – alone.

Many of the seniors were from Port St. Lucie. They complained that the arcades are the only entertainment for them in their community.

“We have lunch. We have dinner. We celebrate our birthday there. So if they close, a lot of us are going to be very lonely,” one Port St. Lucie resident said.

Mike Cannon, who owns Mardi Gras arcade in Port St. Lucie, told the committee that the arcades, which operate under a 30-year-old statute, shouldn’t be punished because of the Allied Veterans wrongdoing.

“You had a big scandal on your hands and we had nothing to do with it,” Cannon said. “We didn’t do anything wrong. We paid our taxes. We do everything by the law and we’ve never had a problem.”

Sen. John Thrasher, the bill sponsor, explained that the measure (SB 1030) would not impact children’s arcades such as Dave and Buster’s or Chuck E. Cheese.

That drew the wrath of Gale Fontaine, president of the Florida Arcade and Bingo Association, who owns several adult arcades in Broward County.

“This is nowhere for them to go. They eat lunch together. They eat dinner together. It has nothing to do about the games. It’s their clubhouse,” Fontaine said, referring to dozens of elderly audience members, some with canes or in wheelchairs, and many of whom were clad in white T-shirts imprinted with “Don’t kill amusement centers” in red.
“I think it’s a disgrace that we will take care of the children’s community and not take care of the senior community.”

Delray Beach resident Anita Silverman, 82, traveled on a bus organized by the association along with about 80 others to attend the committee meeting early Tuesday morning.

She said she is a widow who enjoys the camaraderie of the Atlantic Arcade less than a mile from her house.

“Come Saturday night, I’m all by myself. Saturday night is very lonely,” she said.

The ban will shut down about half of the 300 American Legion halls now open throughout the state, Bob Kiley, American Legion District 6 commander, said. Many of the halls run adult arcades, but all of the proceeds go to charity, Kiley said.

The Senate Rules Committee unanimously approved the proposal even as several members expressed concern that it cast too broad a net.

“I would like to see…a carve out just like we gave Chuck E. Cheese bingo,” said Sen. Eleanor Sobel, D-Hollywood.

The arcades pay 4 percent of their gross proceeds to the state and 6 percent sales tax, Sobel pointed out.
“They’re a legitimate business and there’s unintended consequences by putting them into a different category. I don’t think we intended to do that. If there needs to be more regulation…so be it. This is the difference between apples & oranges.”

Acknowledging that the proposal may cast “too wide a net,” Sen. Jeremy Ring chided the arcade operators for fiercely opposing previous efforts to impose stricter regulations on them.

“We don’t need to be here today. This could have been worked out years ago.
But it is here today because there has only been vehement opposition and never any proactive response to try to work together to create the proper regulations that I’m convinced do not exist,” Ring, D-Margate, said.

But Thrasher insisted the bill is designed to close a “gray area” in law exposed by the Allied Veterans sting.

“I don’t believe we’re putting anybody out of business. If… because of existing loopholes…they have moved into areas they shouldn’t have moved into…they may have to adjust some of the games that are out there,” Thrasher said. “But what this bill does is tighten up the gambling laws. I’m not going to back off.”

Ban on storefront ‘casinos’ now awaits Senate action

Friday, March 22nd, 2013 by Dara Kam

The Florida House overwhelmingly approved a ban on storefront gaming centers less than 10 days after authorities accused Allied Veterans of the World of running a $300 million illegal gambling ring posing as a veterans’ charity.

The multi-state sting also prompted Jennifer Carroll to resign and put the House proposal to ban Internet cafes on a meteoric track to its 108-7 passage Friday morning. A similar measure is also on the fast track in the Senate, which previously had balked at the flat-out ban and instead preferred regulation of the “casinos on the corner” that operate under the state’s “sweepstakes” law.

The main dispute over the ban centers around adult or “senior” arcades authorized under a separate statute but which lawmakers and some law enforcement officials believe also operate illegal gambling houses.

But lawmakers have said they want to shut down any storefront businesses operating electronic games that look or play like slot machines, and both the House and Senate proposals would impact both the Internet cafes and the arcades although the types of machines are different.

Rep. Jim Waldman, D-Coconut Creek, argued that the senior arcades have been operating in the state for three decades and that a Broward County judge dismissed charges against one adult arcade owner accused of running an illegal gambling site.

“So here we are today going to outlaw something that has been legal for the past 30 years has been legal in the state of Florida. If we’re going to do that, what’s next? Because some people have an aversion to alcohol, do we then go back to the days of prohibition and we say you know what, alcohol’s no longer legal in the state of Florida?” Waldman said during a brief floor debate.

Rep. Elaine Schwartz, an elder family law attorney, said the arcades are a harmless way for seniors to spend time.

“I don’t see why we have to jump to making it a crime. It’s something that’s very pleasurable, something that can be enjoyed,” Schwartz, D-Hollywood, said.

But Rep. Carlos Trujillo, the bill sponsor, argued that both types of strip mall gaming centers need to go. Shutting down the estimated 1,000 Internet cafes and possibly hundreds more arcades is possibly “the largest contraction of gaming” in a century, Trujillo, R-Miami, said.

“It sends a message to all the people who are out there stealing from seniors and exploiting the good names of veterans. We don’t want you here in Florida. You weren’t welcome before. You won’t be welcome in the future,” he said.

Florida House tees up Internet cafe ban

Thursday, March 21st, 2013 by Dara Kam

The Florida House will vote tomorrow on an effort to shut down storefront gaming centers many lawmakers believe are actually illegal gambling houses.

The bill (HB 155) is on the fast-track after a multi-state sting resulted in 57 arrests and prompted Jennifer Carroll to resign as lieutenant governor. Authorities accused Allied Veterans of the World, a charitable organization Carroll consulted for while a state representative, of racketeering and money laundering charges associated with operating a $300 million illegal gambling ring.

Rep. Jim Waldman, D-Coconut Creek, raised questions about the bill’s impact on “senior arcades,” adult amusement centers that are authorized under a different statute than Internet cafes, which operate under Florida law regarding “sweepstakes.”

The measure would ban arcades from giving away gift cards and prohibit the accumulation of points, thereby limiting prizes to 75 cents per game. Also at issue is whether the arcade games are “games of skill” or “games of chance,” which are prohibited.

Rep. Carlos Trujillo, the bill sponsor, said his bill won’t affect amusement arcades such as Chuck e. Cheese because those games involve skill while the adult arcade games resemble slot machines. The images move far too quickly for the naked eye to be able to skilfully stop them for a win, Trujillo said.

And Democrats argued that shuttering the arcades will put thousands of people out of work.

But Trujillo said that the jobs are part of an already illegal industry.

“I think it would cost the same amount of jobs if we came up here and said that marijuana dealers can no longer operate,” Trujillo, R-Miami, said.

The Senate could vote on its version of the ban as early as next week.

No more dolla bills, y’all, under House arcade amendment

Wednesday, March 20th, 2013 by Dara Kam

The latest twist in the House’s attempt to shut down storefront gaming centerswould require all arcades games to be coin-operated.

That would include children’s arcades, where parents or their offspring can use $1, $5, $10 bills or use swipe-cards to operate the machines.

The amendment, filed by bill sponsor Carlos Trujillo, R-Miami, would also require that the coins be inserted into the machine after every play and that prizes, limited at 75 cents, be redeemed onsite.

The House is expected to take up the bill (HB 115) and vote it out tomorrow. The Senate could vote on its version as early as Wednesday.

Lawmakers are moving swiftly on the Internet cafe ban in the aftermath of a multi-state sting last week that led to nearly 60 arrests and prompted Jennifer Carroll to resign her post as lieutenant governor.

The ban would also apply to senior arcades located mostly in Palm Beach and Broward counties and in the Tampa Bay area. At the adult arcades, customers play on cabinet-style machines and can win gift certificates, including gift cards they can redeem at stores like Publix.

Both the House and Senate proposals would ban the gift cards and stop the arcades from allowing points to accumulate. The most anyone could win after each game would be 75 cents.

Swift action in Senate on storefront gaming center ban

Monday, March 18th, 2013 by Dara Kam

The Florida Senate is moving quickly on a ban on storefronts gaming centers in the aftermath of a multi-state sting that led to nearly 60 arrests and prompted Jennifer Carroll to resign as lieutenant governor last week.

The Senate Gaming Committee unanimously approved the ban despite protests of owners and workers at adult arcades and Internet cafes and Sen. Maria Sachs, D-Delray Beach, who said the measure (SB 1030) casts too wide a net. Several veterans groups and other charities said the measure would also impact their businesses.

Palm Beach County storefronts that serve mainly senior citizens who play games that look like slot machines would be shuttered under the measure that would ban stand-alone businesses (with some exceptions) that run gambling operations and prohibit them from giving out gift cards or accumulating points. Sachs said she intends to try to remove the prohibitions on gift cards or accumulation of points.

Lawmakers aren’t going after “legitimate business models” like Chuck E. Cheese or Dave and Busters, Committee Chairman Garrett Richter, R-Naples, said.

“We are attempting to close down illegitmate businesses that operate and sound like a gambling operation. If it’s a duck, we’re calling it a duck. They are illegal,” he said.

But Gale Fontaine, the head of the Florida Arcade and Bingo Association who owns senior arcades in Broward County, said her strip mall sites are operating under a section of Florida law. Fontaine was acquitted several years ago of charges of running an illegal gambling operation.

“We are not a gaming center,” Fontaine told the panel. “We are the same as a children’s arcade only our children are 80 or 90 years old.”

The arcade operators, who operate under a different section of law than Internet cafes but would be treated the same under both the House and Senate plans, asked lawmakers to impose more regulations instead of shutting them down.

But the bill sponsor, Sen. John Thrasher, R-St. Augustine, said he believes the games are illegal.

“This is about gambling. It’s about a loophole that has been created due to incredibly new technology that frankly has outpaced the will of this Legislature to do something about it,” Thrasher said. “It’s not about regulation. It’s about a policy decision It’s about closing loopholes perceived or otherwise that have been used to create…illegal gambling.”

The measure could go to the floor for a full vote within one week, the bill’s sponsor, Thrasher said. The House version passed its first committee on Friday and is expected to get a floor vote as early as Thursday.

House committee passes Internet cafe ban

Friday, March 15th, 2013 by Dara Kam

The Florida House Select Committee on Gaming quickly passed an Internet cafe ban even though lawmakers insisted the “casinos on the corner” are already illegal under state law.

But a multi-state sting that led to the nearly 60 arrests and prompted the resignation of former Lt. Gov. Jennifer Carroll has suddenly breathed new life into a ban the Senate just days ago would never have endorsed.

A new version of the ban would also shut down adult arcades, prompting concerns that the bill is too broad and is moving too quickly because of this week’s events.

“This is a knee-jerk reaction to something that took place,” said Rep. Jim Waldman, D-Coconut Creek, who cast the sole vote against the measure.

The House is expected to vote on the measure on Tuesday, and the Senate could vote on its version within two weeks.

Sting that led to Lt. Gov. Jennifer Carroll resignation fuels push for Internet cafe ban

Wednesday, March 13th, 2013 by Dara Kam

A federal gambling probe that led to the resignation of Lt. Gov. Jennifer Carroll last night may fuel support for a ban on the “casinos on the corner” after lawmakers have for years refused to act.

Carroll stepped down amid fallout from the investigation by the Internal Revenue Service, the Secret Service and other Florida law enforcement agencies into Allied Veterans of the World, a non-profit organization that operates dozens of internet cafes in Florida.

Allegations against Allied Veterans include money laundering, siphoning from a nonprofit for personal gain and misrepresenting the amount donated to charities. The IRS obtained search warrants to pursue the case from a federal judge in Oklahoma City.

Sen. John Thrasher, a St. Augustine Republican who called Carroll a long-time friend, said he intends to use the corruption probe to push for a ban on the Internet cafes. Thrasher, a former chairman of the Republican Party of Florida, has sponsored a measure that would place a moratorium on the cafes, but said this morning he wants the Legislature to move faster and go farther.

“Now I believe that the evidence has come out that indicates these things are exactly what we thought they were. They’ve been corrupted. There’s a problem with them. Counties and cities are having problems. Law enforcement people are having problems,” Thrasher told reporters.

Eight lobbyists who represent International Internet Technologies before the legisalture and governor’s office also withdrew their registration on Wednesday. IIT is a software company that is part of the investigation of Allied Veterans of the World. Lobbyist Sarah Bascom told The Palm Beach Post they had been “misled” by IIT.

Palm Beach County banned new Internet cafes from opening in unincorporated areas last year, and the West Palm Beach city commission moved forward with a moratorium this week. More than 1,000 of the cafes have popped up throughout the state. Cafe 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.

Thrasher said Volusia County Ben Johnson, who will participate in a multi-law enforcement agency news conference regarding the sting later today, told him that officials had confiscated $50 million from Allied Veterans of the World and affiliated Internet cafes.

“These things are skimming things off. They’re not doing what they’re suggested to do. It’s a system where they have to go and justify their existence and I don’t think they can do that,” Thrasher said.

Thrasher refused to speculate about a possible replacement for Carroll but said her resignation may help Scott in his reelection bid.

“The governor now has to pick, frankly, somebody that he believes can help him in the campaign. So I think it will be a benefit to him, frankly, down the road,” he said.

House OK’s internet cafe ban that looks like longshot

Thursday, March 1st, 2012 by John Kennedy

Looking to break a standoff with the Senate, the House approved a ban on internet cafes Thursday, with supporters saying they were following the lead of cities, counties and law enforcement officials who have condemned the spread of the streetcorner gambling centers.

Rep. Scott Plakon, R-Longwood, has been pushing the ban for a couple of years — even as the cafes proliferate. He accused them of preying on people who shouldn’t be putting down money on the sweepstakes games.

“Their targeting our poor and elderly has turned me into a crusader on this,” Plakon said.

But the Senate has shown no interest in Plakon’s ban. Instead, Sen. Miguel Diaz de la Portilla, R-Miami, is proposing a milder, regulatory bill (SB 380) for the cafes — that also seems to be going nowhere in the Senate.

“I challenge the Senate today…you may agree or disagree. But I hope they put up some solution,” Plakon said.

The Palm Beach County Commission in January prohibited business licenses from being issued to new cafes in the county, in a bid to stem their spread. But the cafes remain popular — and profitable, records show.

Even Plakon’s bill (HB 3) was softened by the House to continue to allow games offered by such charity groups as the American Legion, Veterans of Foreign Wars and Disabled American Veterans.

Industry leaders, though, also are shrewd political players.

Allied Veterans of the World and Affiliates Inc., based in St. Augustine, works with many veterans’ charities and operates Internet cafes at 39 sites around the state, mostly in North and Central Florida.

It claims to have contributed more than $2.5 million to veterans and first responders in 2011, although documents submitted to the state’s Department of Agriculture and Consumer Services, which regulates charities, provided no detail of the donations.

An estimated 1,000 Internet cafes have opened in Florida since they first started popping up in shopping centers in 2006. They sell internet time or phone cards and profit from computerized sweepstakes-style games that the industry says comply with state gambling laws.

House spinning wheels over Internet cafés

Thursday, February 9th, 2012 by Dara Kam

A ban on Internet cafés poised for a House floor vote appears to be dead in the Senate, which likely won’t do anything about regulating the so-called “casinos on the corner” either.

A Senate committee approved a measure regulating the cafés, and would have killed a bill to ban them despite the support of Gov. Rick Scott who said they should be outlawed.

“Candidly, the Internet cafés are not a major pressing issue in our world. We’re focused on the budget,” Haridopolos, R-Merritt Island, said.

Haridopolos pointed out a proposal to ban the cafés would not have made it through its first committee stop and said his chamber would “take a look” at the measure (HB 3) if the House passes it.

“In the grand scheme of things, it’s not our major focal point. I guess some people are really excited about taking that issue on. It’s pretty low on our totem pole,” Haridopolos said.

A pair of competing legal opinions – one from the Seminole Tribe’s lawyers and another from lawyers for the cafés – say that SB 390 that would regulate the cafés would nullify a compact with the tribe potentially losing the state $233 million a year, or that it wouldn’t.

Haridopolos on gaming: House ‘led folks on,’ Internet café reg in doubt

Wednesday, February 8th, 2012 by Dara Kam

It’s highly unlikely that Senate President Mike Haridopolos will get the up-or-down floor vote he wanted on a sweeping gambling bill that included three high-end casinos since the House effectively killed the bill last week.

Without naming names, Haridopolos accused GOP leaders across the rotunda of playing games with the way they handled the “destination resorts” bill that sponsor Erik Fresen, R-Miami, asked to be put aside Friday because he knew it would not get voted out of its first committee.

“Given all the signals they were sending, what committees they sent it to, it was pretty obvious that they led some folks on and they weren’t really going to vote on it,” Haridopolos, R-Merritt Island, told reporters this afternoon. “We saw that coming about a week ago.”

When asked if he was disappointed that the bill appears to be done for before the mid-point in the 60-day legislative session, Haridopolos reiterated that he wanted it to get a floor vote.

“Clearly with the decision made in the House, we’re not going to have that opportunity. But that’s why we have two chambers. I’m not offended by it. I think we all saw it coming. They chose to act quickly and just kill it from discussion. That’s their prerogative,” he said.

But Haridopolos stopped short of sticking a fork in the destination resorts bill, saying the Senate’s version would continue to move through committees even though it appears to be going nowhere in the House.

“It’s a 60-day session. We’ll have to see what happens,” he said.

And a legal opinion from the Seminole Tribe’s attorneys puts in doubt the future of another gambling issue dividing the two chambers – Internet cafés.

The House is moving forward with a proposal to ban the “casinos on the corner” now operating under Florida sweepstakes laws. But the Senate appears to favor a measure that regulate the cafés.

That would violate an agreement the state struck with the Seminoles, the tribe’s attorneys wrote in an opinion, and could put at risk the $233 million a year the Indians give the state for “exclusivity” in certain types of gambling.

Haridopolos called that a “new wrinkle” in the Internet café debate and said the Senate’s lawyers were looking into the issue.

“Clearly the House and the Senate are not on the same page…A majority of senators would agree with regulating as opposed to banning those facilities,” he said.

Internet ban, in limbo in Senate, on its way to House floor with blessing of Gov. Scott and Cabinet

Wednesday, February 1st, 2012 by Dara Kam

Gov. Rick Scott and the Florida Cabinet are putting pressure on lawmakers to approve an all-out ban on Internet cafés now on its way to the House floor but facing a doubtful future in the Senate.

The House Economic Affairs Committee approved the bill (HB 3) this morning, drawing the praise of the Republican governor and Cabinet who want the so-called “casinos on the corner” shuttered.

Critics of the cafés, an estimated $1 billion industry which operates under state “sweepstakes” laws and are largely unregulated, say they prey on the state’s poor and vulnerable. But the café operators say they provide good jobs for their employees and a place to socialize for seniors and others.

Scott believes the store-front casinos found in strip malls throughout the state are already illegal but wants lawmakers to officially ban them.

“These store front casinos are impacting Florida’s neighborhoods and families,” said Governor Scott. “They are and should be illegal. Representative Plakon’s bill closes this loophole and I commend his dedication to shutting down these establishments,” Scott said in a statement released by Rep. Scott Plakon, the Longwood Republican who’s sponsored the bill.

Attorney General Pam Bondi, Chief Financial Officer Jeff Atwater and Agriculture Commissioner Adam Putnam joined in the chorus demanding the shut-down.

But the Senate is moving forward with a separate measure that would regulate the cafés and impose a $100 fee per computer terminal for operators. Estimates of the number of cafés in the state range from 800 to 1,400 but all agree they have mushroomed in the past few years. Palm Beach County commissioners recently barred new cafés from opening in unincorporated areas.

The Senate Regulated Industries Committee approved a regulation measure and set aside a bill that would make the cafés illegal.

Internet café stand-off: Senate committee passes regulation, House and Scott want shut-down

Thursday, January 19th, 2012 by Dara Kam

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.

(more…)

Scott tells lawmakers to shutter Internet cafés: ‘I don’t believe in it.’

Wednesday, January 18th, 2012 by Dara Kam

Gov. Rick Scott said this morning he wants lawmakers to outlaw Internet cafés rather than regulate them as Senate leaders are proposing.

“I don’t believe that the Internet locations are legal or should be legal,” Scott told reporters this morning. “It’s an area that I think doesn’t make sense. I don’t believe in it.”

A House committee passed a measure banning the “casinos on the corner” yesterday but the Senate appears to favor a proposal that would regulate the cafés which operate as “sweepstakes.” Customers pay for Internet time, which they can use to browse the Web or play the games in which computer time or credit is won. Critics say the games are highly addictive and prey on the poor.

Palm Beach County commissioners recently issued a moratorium blocking any new cafes from opening in unincorporated areas.

Scott rejected suggestions that the games are not as bad as the Lottery. Scott’s administration wants the Lottery to sell more tickets this year to help pay for public schools. Scott said the state authorized the Lottery years ago.

“It generates money for our schools. We’re not going to change that,” he said.

House committee approves ban on Internet cafes

Tuesday, January 17th, 2012 by Dara Kam

A measure banning Internet cafes in Florida cleared its first hurdle in the Florida House over the objections of two Palm Beach County Democrats and setting up a stand-off with the Senate that wants to regulate the “casinos on the corner.”

Lawmakers need to shutter the cafes because they prey on the poor and elderly and are highly addictive, said bill sponsor Rep. Scott Plakon, R-Longwood.

Plakon also cited reports showing that welfare recipients are using state-issued debit cards to at ATMs at the facilities to underwrite their gambling habit.

Lawmakers can pass his bill (HB 3), do nothing or regulate the facilities, which could cost the state $200 million a year by invalidating a deal Florida has with the Seminole Indians, Plakon said.

“The regulation bill would be the effect of us authorizing 1,000 gambling locations in this state,” Plakon said.

To help persuade the Business and Consumer Affairs Committee to support his bill, Plakon pointed to a San Francisco newspaper that pilloried Florida lawmakers for failing to shut down the cafes.

“This is San Francisco laughing at us,” Plakon said. “San Francisco, mind you members, is laughing at us.”

Cafe 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.

Palm Beach County commissioners recently issued a moratorium blocking any new cafes from opening in unincorporated areas.
Industry backers say shutting the cafes down would put thousands of workers in the unemployment line.

“What strikes me is the jobs. It seems like some funny, fuzzy math but there are thousands, possibly tens of thousands of jobs at risk,” said Rep. Joe Abruzzo, D-Wellington, on the losing side of a 10-5 vote.

Rep. Mack Bernard, D-West Palm Beach, voted against the measure but said he was troubled by the bill needed more information about the ability the use of welfare money at the cafes.

“This is one of the sickest votes I’ve taken since I’ve been here,” Bernard said.

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