July 25, 2016

Mostly cloudy

Ohio’s anti-Internet-cafe effort over for year

By Ann Sanner

COLUMBUS — Don’t bet on a crackdown this year on gambling operations known as Internet cafes.

The Ohio Senate won’t act before the session ends this month on a proposal that amounts to a virtual ban on the game parlors.

Senate President Tom Niehaus said members of his Republican caucus had a number of concerns with the bill and not enough days left to fully vet the measure. The Senate aims to finish its work for the year by Thursday.

“We were simply running out of time,” Niehaus told reporters, as he acknowledged that he wouldn’t be bringing the measure to a vote.

The bill was approved by a 2-to-1 margin in the House earlier this month. It would shut down nearly all of the estimated 800 sites by narrowly defining what counts as a sweepstake.

Opponents say the Internet cafe computer games that operate like slot machines with cash prizes amount to illegal gambling.

Customers pay for Internet time or phone cards and use them to bet points on computers loaded with games such as poker. Operators say they sell legitimate products with a chance to win a prize.

Niehaus said lawmakers questioned the impact the bill could have on “legitimate” businesses that offer sweepstakes games, such as McDonald’s. Legislators had thought the House-passed version of the bill exempted those businesses. But he said, “Some concerns were raised just in the last 12 hours that maybe it didn’t.”

The announcement of the proposal’s demise this session came on the heels of a packed Senate hearing on the issue.

Ohio Attorney General Mike DeWine has led the push to get rid of the businesses. He told a Senate panel on Tuesday that the amount of cash flowing through the operations made them ripe places for money laundering, organized crime and drug dealings.

Plus, he said cafes offered the chance for consumers to be scammed. “We don’t know what the payout is to the people who go into these Internet cafes,” he said.

It’s been nearly two years since lawmakers first began weighing what to do about these sweepstakes games that are largely unregulated and don’t face the same scrutiny as casinos and other games of chance. Some favored new regulations while others wanted a ban on the Internet cafes.

DeWine told lawmakers he preferred a ban, but he would leave the decision up to the state Legislature. “The status quo is simply unacceptable,” he added.

The Republican attorney general said later Tuesday that he was disappointed the Senate wouldn’t consider the bill.

“I’m optimistic that the momentum on this issue will continue and the new General Assembly will act early next year,” DeWine said in a statement.

Niehaus said many in his Republican majority caucus were leaning toward imposing regulations and not an outright ban, and that he anticipated the measure would be studied again next session.

House Speaker William Batchelder, R-Medina, said he also was confident the bill would be quickly re-introduced.

Critics of the bill had stepped up their visibility in recent days.

Opponents lined the hearing room Tuesday morning. Many wore T-shirts claiming the measure would take away their jobs.

Owners and employees of Internet cafes also rallied in Cleveland on Monday, warning that forcing them out of business could cost 4,000 jobs or more.