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Wednesday, 24 February 2010 17:50

Maggie debates how steep is too steep for cyber sweepstakes fees

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Business owners with cyber sweepstakes machines in Maggie Valley received both good and bad news last week.

Luckily for them, the town board passed a much lower business license fee than originally proposed and delayed the pay-up date till July, which marks the beginning of the next fiscal year.

However, the annual fees passed are still sky-high: $2,500 for the first four machines and $750 per machine thereafter. Though Maggie Valley’s town board already passed zoning restrictions on the machines, it had yet to settle on an annual fee.

The planning board was tasked with developing a fee, but was sent back to the drawing board twice by aldermen. The planning board first proposed a $2,400 fee per machine, then revised their suggestion to $2,000 per machine.

Both options were too high for the aldermen’s tastes, but the planning board saw things differently.

“We just strongly felt that we didn’t want it to proliferate through town,” said Billy Brede, chairman of the town planning board. “We presented the ordinance that we felt would protect the town.”

Cyber sweepstakes is a close relative of video poker that allows players the chance to win phone and Internet time that can be traded in for cash. Sweepstakes machines are able to subsist due to a loophole in the state’s video gaming ban.

Brede said limiting cyber sweepstakes machines is important to preserve Maggie’s family-friendly environment, something that Brede says is important to both locals and visitors.

“People who come here for tourism are looking for family values,” said Brede. “We have strong family values, and we don’t want to see gambling proliferate.”

Alderman Colin Edwards said while the planning board works hard to make its decisions, the aldermen thought the fees it proposed were excessive and might risk shutting down businesses.

“I don’t approve of gambling, but I don’t want to see anybody go out of business, either,” said Edwards. “The General Assembly will probably be addressing this issue anyway in this next coming session, so it might not even matter what we do.”

Aldermen Phil Aldridge and Saralyn Price were not present for the vote, but the three remaining members voted unanimously for the measure.

Since some businesses opted for the machines to stay afloat during the severe recession, both the planning board and the town board agreed that the fees shouldn’t be implemented until July.

“The board didn’t want to penalize those businesses who had taken up those ventures during these tough economic times,” said Nathan Clark, the town planner.

Businesses could save up for the fee in the meantime, and perhaps even rethink their decision to harbor sweepstakes machines, Clark said.

“We didn’t want to start billing people in the middle of the year,” said Tim Barth, town manager of Maggie Valley. “We didn’t think that was appropriate.”

The towns of Canton and Franklin passed comparable fees to what Maggie ultimately settled on, but didn’t hesitate to begin collecting immediately.

According to the town’s last count, there are 10 machines within three businesses in Maggie Valley. Barth said it’s unlikely that the town has identified all locations, however.

This and That Home Décor and Gift Shop, which housed four of these machines, seems to have closed its doors.

For now, each business must pay a nominal fee of $10 to register cyber sweepstakes. It’s the same fee the town collects for pinball machines or video game machines — clearly a whole different ball game.

“No matter how good you are at Pac-Man...it’s never going to shell out $500 or $5,000,” Clark said.

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