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Sweepstakes centers under microscope in South Boston

Several sweepstakes ventures have inquired about opening operations in South Boston since 2008, but Town Manager Ted Daniel, who also serves as zoning administrator for South Boston, has interpreted the town zoning ordinance as excluding any Internet sweepstakes use. He has based his decision on the operation not being defined in the ordinance nor listed as a use by right or by special use permit.
Some sweepstakes are legal in Virginia, and an influx of out-of-state and in-state businesses are seeking business licenses to begin operations in South Boston, Daniel said in a background document issued to planners earlier this week.

For this reason, South Boston planners held a public hearing Wednesday and recommended changes and amendments to a town code zoning ordinance aimed at adding the definition of electronic contest devices.

The changes also amend the definitions of an amusement center.

The current definition of an amusement center does not include electronic contest devices such as Internet sweepstakes, which are new amusement technology since the zoning ordinance was comprehensively updated in 1999, according to Daniel.

By expanding the definition of amusement center to include electronic contest devices, the zoning ordinance will recognize their existence and properly define them for land use purposes, he told planners Wednesday.

Planners voted unanimously, with Brian Cheever absent, to recommend an addition to Sec. 114-2 of Town Code to identify an electronic contest device as “an electronic device, machine, apparatus, implement, equipment or other electronic thing which operates either automatically or with the aid of some physical act by the player or operator in such a manner that it may reveal something of value to the player or operator.”

Language describing an amusement center would be amended to define it as a building, portion of a building or area outside a building where “(a) four or more video game machines, pinball machines, pool or billiard tables or any combination of four or more such items are maintained for use by the public whether as a principal or accessory use;” or “(b) one or more electronic contest devices are maintained for use by the public whether as a principal or accessory use, provided that such use is not in violation of any applicable law, regulation or ordinance regarding illegal gambling.”

In a presentation to planners Wednesday, Daniel said by expanding the definition of an amusement center to include electronic contest devices, individuals wishing to establish such a use that is not in violation of any applicable law, regulation or ordinance regarding illegal gambling, would be permitted to do so under a Special Use Permit.

Currently, amusement centers are permitted by Special Use Permit in B-2 General Commercial, Central Business, Adaptive Reuse and General Industrial districts.

Bob Cooper of Snow Camp, N.C. was the lone speaker at Wednesday’s public hearing.

At the November meeting he had told told planners he operates two Internet-based sweepstakes contest centers in North Carolina.
Customers see his business as a source of entertainment, said Cooper, with 21 different games offered, he said Wednesday.

“Our interpretation of it right now, and it may not be the interpretation of everybody in this room, is that the way we operate this is legal under Virginia state law,” said Cooper, who does business in North Carolina as C&C Internet Sweepstakes.

“I wouldn’t waste my time or your time if I didn’t think this was correct under Virginia state law.

“I wish there was some way I could convince you folks…in order for it to be gambling, it has to be something someone’s doing when he’s doing this to change the outcome.”

The sweepstakes is a motivation for the customer to come in and buy Internet time, continued Cooper.

“It’s still not gambling, because there’s nothing they can do to elevate their chances at winning.”

Cooper, who has applied for several locations in Virginia, had previously described his customers as over 59 years of age and 75 percent female.

He has appealed Daniel’s decision not to permit his Internet sweepstakes business within the town to the board of zoning appeals.

Since 2008, Daniel, who serves as zoning administrator for South Boston, has interpreted the town zoning ordinance as excluding any Internet sweepstakes use since the operation is neither defined in the ordinance nor listed as a use by right or by special use permit.

The burden should be on those applying to operate such a business in South Boston to prove they’re legal, Daniel told planners.

“We need to get ourselves in a position where we define what they are, and if they are legal by law, where they’d go,” explained Daniel.

“We need to come up with a system that, in my opinion, puts the burden of proof on him to prove beyond any doubt (that it’s legal). 

We have to have public comment, and everybody in the community who is for or against them should have their say to determine that.”

“If you give a special use permit, you can issue it for a limited time period with conditions on it to see if it fits into the community.

“By amending our code, we’ll put ourselves in a position where we’re still in control,” he said.

Town council is expected to discuss the proposed amendments to the town’s zoning ordinance at its January meeting.