Charlotte City Council members want to crack down on "skill" arcades

A Charlotte City Council committee is asking staff to look into potential new regulations for "fish game" arcades .

Why it matters: The arcades, most prevalent in Charlotte's lowest-income neighborhoods , target vulnerable populations and are a magnet for criminal activity, Charlotte-Mecklenburg Police Department says.

• In council's view, the operations are hindering multi-million-dollar efforts to improve historically marginalized areas, particularly the corridors of opportunities such as West Boulevard.

The latest: Members of the city's intergovernmental relations committee this month expressed interest in listing the matter on their legislative agenda, essentially their wishlist to the General Assembly.

• Council member LaWana Mayfield first raised the issue.
• "I think we have a responsibility to do something about it," agreed at-large representative Dimple Ajmera, who chairs the Intergovernmental Relations Committee.

The big picture: These loophole gambling joints have long been an aggravation to police and an eyesore to neighbors. They've also been troubling to families whose loved ones lost their grocery or rent money to the addictive games.

Between the lines: It's illegal in North Carolina to pay cash for a gaming machine, unless it's for a "game of skill." Most of these businesses argue that's the case: Their games are based on skill, not luck.

Reality check: CMPD plainly labels these places as illegal casinos. The games aren't regulated, and patrons are breaking the law by playing.

• The owners have no actual obligation to pay the winnings, either.
• "CMPD is aware of instances where arcade owners and employees are threatening victims to keep them from calling police, withholding 'winnings' from them to keep them silent, and paying them off to keep them silent," the department tells Axios.

State of play: CMPD tells Axios it's aware of approximately 60 skill-games businesses. Others operate underground, including in gas stations, small businesses and unknown locations.

• Sometimes the crime that occurs at these locations goes unreported to police. CMPD says it's found security guards are typically unlicensed and, in some cases, were armed convicted felons.

What they're saying: State Rep. Harry Warren, who has unsuccessfully tried to pass new regulations for these venues, tells Axios he suspects the city will find itself in "marathon litigation with the well-financed stakeholders in the industry trying to determine succinctly what is chance and what constitutes skill."

Flashback: In 2021, Warren introduced a bill to the state House to legalize some video gambling machines and put the revenue toward law enforcement and higher education, including a forgivable loan program for community college students. The bill was revived in 2023 but stalled in a committee, Warren said.

• He says another representative is drafting a new bill, taking on the challenge.
• "If [council's] goal is to rid the city or county of 'sweepstakes' parlors, it would be less problematic to provide whatever assistance local and county law enforcement may need to enforce the current law and close the offending operations down," Warren says.

By the numbers: Since 2022, at the addresses of "arcades," CMPD has reports of two homicides, one rape, 65 robberies and 30 aggravated assaults, according to its data.

• As recently as early October, an armed robbery took place at one of these locations and is under investigation.

Context: Agencies across the state, including CMPD, announced this year they'd raided hundreds of arcades and issued 800 warrants. In September, CMPD seized multiple guns, money and illegal gaming equipment from another arcade on Freedom Drive.

• At two arcades on Albemarle Road and Providence Road, detectives seized in April 117 gambling stations, about $18,000 in cash and two firearms.

Zoom in: Arcades could be limited through zoning laws, but it probably wouldn't make much difference. Most businesses are already violating building and fire codes, per CMPD.

• In the city's development ordinance, an "Adult Electronic Gaming Establishment" requires a zoning permit and must be at least 1,000 feet from most neighborhoods, schools, churches and public parks.
• They should only be open 8am to 10pm and have clear windows.

What's next: Dana Fenton, Charlotte's intergovernmental relations manager, told council he would discuss the issue with the police chief to determine possible measures the city government could take.

• This will likely be a revisited conversation for council over the next several months.