Friday, April 20, 2018
Business

New law angers operators, customers of Hernando's Internet cafes

SPRING HILL — About 3:30 p.m. Wednesday, Sandy Stavola began shutting down the 50 computer terminals inside Spinners Sweepstakes Cafe. Her boss, Terry Kasberg, could only shake his head as he watched.

"It's just not right," said Kasberg, who opened the establishment on U.S. 19 in November. "This is going to hurt a lot of people for a long time."

The reaction to Gov. Rick Scott's signing of House Bill 155, banning Internet cafes, was swift and sure. By the end of the day, nearly all of the estimated 30 sweepstakes businesses operating in Hernando County had been shuttered. The sudden closings caused a stir among the mostly elderly patrons who frequented the cafes.

"The whole thing stinks," said Spring Hill resident Marge Stackpole, who showed up Thursday morning at Win-City Sweepstakes only to find the building locked. "This was a nice place to spend a few hours doing something I enjoyed doing. Nobody was hurting anyone."

Kasberg, who organized a rally a few weeks ago to protest the legislation, complained that the new law is unwarranted because the activities inside his business were considered legal for decades in Florida until lobbyists from large gaming institutions and parimutuel operations began applying political pressure to legislators.

The bill, which was largely the result of a federal fraud investigation of Allied Veterans of the World that netted several dozen arrests of sweepstakes cafe operators statewide, punished owners of legitimately run businesses, Kasberg said.

"We had nothing to do with them," Kasberg said. "And for that, the politicians chose to pass a law that's going to put a lot of people out of work."

Proponents of the measure, including Rep. Robert Schenck, R-Spring Hill, who is chairman of the House select committee on gaming, maintained that the sweepstakes cafes operated through a loophole in Florida law that allowed companies to offer sweepstakes as a promotion for selling a product. Owners of the storefronts have said they were only selling Internet time and that their customers' activity was not any different than buying a scratch-off lottery ticket, where only a certain percentage of players can win.

Longtime Spinners customer Carole Amandola said she didn't equate her actions inside the cafe with gambling, and resented being told by politicians what she could do with her money.

"I came in here strictly to have fun," said Amandola, 75. "To me, gambling is something you do if you're interested in winning big money. I always set my limit at $40. The most I ever won was about $400."

The new law updates the definition of slot machines and clarifies that sweepstakes games must involve incidental, noncontinuous play. It requires that coin-operated games must have an element of skill, and players are limited to prizes valued at 75 cents. Prize money may not be accumulated or exchanged for gift cards or cash.

Dustin Clough, a sales and marketing representative with CyberGT Systems in Punta Gorda, which sells and sets up sweepstakes systems, said that his company shut down all of its 50 Internet cafes in Florida immediately after the law went into effect.

Clough expects the new legislation will be challenged in court.

"There are constitutional issues that need to be addressed somehow because the law is going to affect a lot more than just sweepstakes cafes," he said.

Kasberg, who has more than $100,000 invested in his business, said he was waiting to see if a court injunction would be filed. While he has considered adjusting his sweepstakes games to comply with the new law, he is not certain his customers would buy it.

"They're used to coming in and relaxing and maybe winning a few bucks while they're here," he said. "I don't think playing for a 75 cent trinket will do the trick."

Meanwhile, Hernando County Sheriff's Office spokeswoman Denise Moloney said late last week that nearly all of the county's known sweepstakes establishments appeared to have closed.

Owners of any open establishments will be educated by deputies about the new law. The Sheriff's Office will work with the State Attorney's Office, she said, on filing charges against those found to be out of compliance.

Logan Neill can be reached at [email protected] or (352) 848-1435.

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