Rocky Mount planning officials are taking aim at gaming parlors that have swept through the city in recent months as state courts and lawmakers continue debating the legality and legitimacy of the businesses.

The shops, often called Internet sweepstakes cafes, sell customers phone cards or Internet time that also allows them to play sweepstakes games — mostly slots and card games. Customers can win prizes, more playing time or cash.

Seven such businesses have opened in Rocky Mount during the past several months, and at least two new shops are slated to open in the coming weeks. A handful of Rocky Mount bingo halls also have the games.

The rapid and unregulated growth of sweepstakes parlors concerns city officials, Planning Director Ann Wall said. Rocky Mount City Council will consider imposing a moratorium on new sweepstakes cafes Monday.

“That will allow us 60 days to get a handle on what’s going on and to craft regulations,” Wall said. “Some of our concerns are dealing with hours of operation, how many of these should be open in the same area, and we have parking and traffic concerns.”

Rocky Mount would be following a statewide trend by implementing stringent local regulations on sweepstakes cafes. Wilson passed a similar moratorium in December.

Some elected Rocky Mount officials would love to simply outlaw the businesses, but that’s not an option.

So far, the sweepstakes gaming industry has managed to get around each effort by state lawmakers to ban them as illegal gambling, as the N.C. General Assembly did with video poker.

Several North Carolina judges have ruled that the way patrons pay to play the games at the cafes and the randomness of winning differentiates the cafe games from illegal gambling. The industry likens the business to instant-win games played at fast food restaurants and under bottle tops.

Legal or not, Councilman Reuben Blackwell said he believes the Internet gaming parlors are exploiting a vulnerable population and bending state gambling laws to the detriment of the community.

“I see it as an opportunity to prey on people who are already living at risk,” Blackwell said. “Just because it’s popular doesn’t mean it’s right. Aside from filling retail space, I see no benefit from these establishments.”

Shirley Gander doesn’t feel violated or exploited, she said.

Gander became visibly frustrated Thursday as she stared at spinning slots on a computer screen at a Rocky Mount sweepstakes cafe. The 66-year-old single grandmother wasn’t upset about her winnings; she was upset with Rocky Mount.

“The city doesn’t need to be messing with the sweepstakes,” Gander said. “It’s legal. It’s fun. Leave it alone.”

Gander clicked again to send the video slots spinning.

“The city needs to worry about these utility rates, not gambling,” Gander continued, turning from the screen. “I could barely afford to pay my bill last month.”

Industry grows quickly, quietly

Sweepstakes cafes have popped up amid little publicity in several locations throughout the city.

Business Center Internet Cafe is tucked into the back corner of the Oakwood shopping center of North Fairview Road. The Rocky Mount Business Center Internet Cafe is located near Big Lots in the Sutters Creek plaza. D&J Business Center is one of three sweepstakes cafes located within a few hundred feet of each other in the same shopping center on Stone Rose Drive.

The parlors represent themselves as business centers or Internet cafes that also have sweepstakes prizes, Wall said, but really it’s the other way around. With very little advertising, she said, many people go to the cafes primarily to play games.

“We don’t need to advertise this type of thing,” one sweepstakes cafe manager said, declining to be identified. “Word of mouth is the best advertising. Once people get started, they get hooked.”

Requests to speak with owners or managers at most of the businesses went unreturned last week. But Eric Shields, manager of EZ Access on South Wesleyan Boulevard, said he has nothing to hide.

“Everything we’re doing is perfectly legal,” Shields said. “We’re not forcing anyone to come in here. I feel like everyone has a choice, and if you don’t like it, don’t come.”

Shields, who helped open EZ Access in Rocky Mount more than a year ago, said he’s in favor of city regulations on sweepstakes cafes, especially since most new zoning laws wouldn’t impact existing businesses.

“There doesn’t need to be three Internet cafes open in one shopping center,” he said.

Sherry Upchurch owns five EZ Access stores throughout North Carolina, including the Rocky Mount location. Upchurch said she also welcomes local regulation of her industry and even supports entering a profit-sharing agreement with the state.

“We are still in America after all, and people should have a choice in how they entertain themselves,” Upchurch said. “But when some of these (sweepstakes) businesses don’t operate within the law, it makes us look bad also. I’m all for oversight.”

'A state issue'

Wall said the city doesn’t have any plans to eradicate the sweepstakes businesses, controversial as they may be. Planning officials would like time to study the cafes and any negative consequences they might have on commerce.

Many of the gaming parlors are open 24 hours and draw considerable crowds most nights of the week. The cafes can allow customers to smoke because they don’t serve food. A couple of the Rocky Mount parlors allow children as young as 14 years old to enter the business, and window and display signs at most of the Rocky Mount sweepstakes cafes offer little indication of what goes on inside, instead advertising public Internet use, fax machines and phone time.

“Those are all things we need to take a look at,” Wall said.

The Rocky Mount City Council will hold a public hearing on the proposed moratorium during its meeting at 7 p.m. Monday at City Hall.

Councilman W.B. Bullock said he’s OK with taking time to examine local planning regulations but said, ultimately, any significant changes will be up to the state.

“This is really a state issue,” Bullock said.

The N.C. General Assembly likely will be looking at the issue again this spring, N.C. Sen. A.B. Swindell said.

Lawmakers attempted last year to close a loophole in the state gambling law that allowed for sweepstakes cafes, Swindell, D-Nash, said, but doing so also would have shut down popular peel-and-win games at places like McDonald’s and Burger King.

“I haven’t personally been in one, so I don’t know if what they are doing is necessarily wrong or illegal,” Swindell said. “That’s what we have to find out.”

Councilman Andre Knight said he likens sweepstakes cafes to controversial payday lending operations.

“Most people who go in there are hoping to cash in, but the odds are slim to none that they do,” Knight said.

Gwen Hale, a frequent cafe customer, said anyone who walks into a sweepstakes parlor will figure out quickly the games are just “good, clean fun.”

“We’re not hurting anyone,” Hale said. “We’re not doing drugs up in here or stealing from people. I play responsibly. I just like to play to unwind and have a little fun. I can gamble on the lottery, and it’s legal. But with these games, even if I lose, I get to enjoy myself for a while.

“It’s worth the money.”

For more Rocky Mount news, read Hixenbaugh's City Desk blog.

Rocky Mount sweepstakes locations

• Business Center Internet Cafe, 149 N. Fairview Road
• XTECH Internet Cafe, 3022 Sunset Ave.
• Rocky Mount Business Center Internet Cafe, 556 Sutters Creek Blvd.
• EZ Access, 435 S. Wesleyan Blvd.
• D&J Business Center, 1854 Stone Rose Dr.
• 0 64 Bingo, 1954 Stone Rose Dr.
• PhoneTime and More, 1928 Stone Rose Dr.
• Two other cafes are slated to open at 550 N. Wesleyan Blvd. and 1218 Home Depot Plaza.

How the games work

Customers at sweepstakes cafes pay directly for Internet time — usually about $1 for every 10 minutes — and then, free of additional charge, are awarded a commensurate number of credits to play games of chance, which sometimes pay out prizes.

The more Internet time a person buys, the more “free” sweepstakes credits they receive.

Like at a casino, sweepstakes players are allowed to wager varying amounts of the gaming credits to win smaller or larger returns. When players have exhausted all their credits, they can either redeem their winnings for cash or more credits to keep playing.