Community Development Department Electronic Game Promotion Establishments (Internet Cafes) City Council Public Hearing 2nd Reading May 1, 2012

Community Development Department Internet Cafes Background – PLDRB Recommendation PLDRB Recommendation: –Approval of LDC Amendment –Comments from Board members Sunday operating hours should be reduced Length of non-conformity (member thinks it should be minimal or none at all) Reasoning for 1,000’ separation from church, schools, and public parks

Community Development Department Internet Cafes Background – Issues from Previous Public Hearing Sec : Definition “Electronic Equipment” means any electronic device provided by or on behalf of the Operator that is used or adapted for use to conduct or reveal the results of, a drawing by chance conducted in connection with the sale of a consumer product or service, sweepstakes or other game promotion, that displays results by simulating a game or games ordinarily played on a slot machine and orn other similar electronic games of chance. Sec : Initial Certificate of Use. At the time of the renewal of Business Tax Receipt aAll nine Operators who are conducting an Electronic Game Promotion on the date of the adoption of this Ordinance have 45 days from the effective date of this Ordinance to shall apply for a Certificate of Use. as provided for in this section. Any such initial Certificate of Use shall have a term or duration until September 30, 2013.

Community Development Department Internet Cafes Background – Issues from Previous Public Hearing Sec : (d) a statement certifying that the establishment and the electronic game promotion comply with all applicable State regulations, including but not limited to, Florida Statutes and , and any necessary supporting documentation. Include requirement to post bond or establish a trust account if the sweepstakes advertise a prize of over $5,000. Other requirements for operations which offer $5,000 prize and above include keeping database of all winners of more than $25.

Community Development Department Internet Cafes Background – Issues from Previous Public Hearing Sec (e) Establishments shall not have window tinting that reduces exterior or interior view in a normal line of sight. Window signage shall allow a clear and unobstructed view from outside the building and in a normal line of sight of the cash register and sales transaction area. Ordinance prohibits tinting or obstruction of windows that reduces view in a normal line of sight. Additionally requires a clear line of sight to the cash register and sales transaction area (The signage section of the ordinance already prohibits signage between the vertical distance of 4 and 6 feet).

Community Development Department Internet Cafes Background – Issues from Previous Public Hearing Options: Establishments shall not have window tinting that reduces exterior or interior view in a normal line of sight. Window signage and tinting shall allow a clear and unobstructed view from outside the building and in a normal line of sight of the cash register and sales transaction area. Establishments shall not have window tinting that completely eliminates exterior view in a normal line of sight. Window signage shall allow a clear an unobstructed view from outside the building and in a normal line of sight of the cash register and sales transaction area. (from Internet Café Owner) Delete Section

Community Development Department Internet Cafes Background – Issues from Previous Public Hearing Sec (d) Licensed security guard required on premises from 6 p.m. to closing. There is currently no proposed change to this requirement since there has not been an identified alternate to a licensed security guard. Sec (e) Hours of Operation There is currently no proposed change to the hours of operation from (10 a.m. to 2 a.m.) to (8 a.m. to 2 a.m.) as suggested by representatives from Internet Cafe.

Community Development Department Internet Cafes Other Amendments Sec (a)(3) (3)A cCertification by an independent testing laboratory through laboratory confirmation report that the computer software used by the Operator to conduct the Electronic Game Promotion has been tested by an independent testing laboratory that has verified the manner in which the software works and whether or not it contains a random number generatorand that it does not contain a random number generator. The verification shall comply with all applicable state and local laws, including this Ordinance;

Community Development Department Internet Cafes Background Moratorium Expires May 4, 2012 Direction from previous City Council Workshops –Control Location, Development Standards in Land Development Code Regulations –Business Operation (including safety, background checks) - Code of Ordinance Amendment

Community Development Department Internet Cafes Current Status 9 Establishments 8 are in COM-2, 1 in COM-1 Classified as “Retail” use and allowed in all Commercial zoning districts and Master Planned Development (MPD)

Community Development Department Internet Cafes-Background - Non-conforming with proposed regulations. *Incidents include: Abandoned Vehicle, Alarm-Commercial Burglar, Disturbance (Verbal or Physical), Indecent Exposure, Intoxication, Suspicious Vehicle, Person, or Incident. NameAddress # of terminals Operating Hours (Generally) Sheriff’s Incident Report* Zoning Within 1000’ of following : School Public ParkChurch EZ Café 1755 Palm Harbor Parkway Unit A24 10 a.m. to 12 a.m. 2COM Palm Coast Internet Café160 Cypress Point Pkwy a.m. to 12 a.m.0COM-2 - Lucky Day Sweepstakes108 Flagler Plaza75 10 a.m. to 11 p.m. 1COM-2 -- Neptune Internet Sweepstakes 1499 Palm Coast Pkwy NW, Suite C30 0COM-2 - Thunderbird Internet Café (Winn Dixie Shopping Center) 1274 Palm Coast Parkway SW40 10 a.m. to 12 or 2 a.m. 2 COM-2 - Copacabana Internet Café 1000 Palm Coast Parkway SW Unit COM-2 - Sunny Day Internet Café 15 Cypress Branch Way Suite to 12 or 2 a.m. 0COM-2 - Allied Veterans of the World50 Plaza Drive Suite hours1COM The Lucky Palm 300 Palm Coast Parkway Suite p.m. to 10 p.m.0COM-2 ---

Community Development Department Internet Cafes Land Development Code (LDC) amendments –Definitions: –“Electronic Game Promotions” a sweepstakes or other game promotion which utilizes Electronic Equipment … in connection with the sale of a consumer product or service. –“Electronic Equipment” electronic device … used or adapted for use to conduct, or reveal the results of, a drawing by chance conducted in connection with the sale of a consumer product or service … that displays results by simulating a game or games ordinarily played on a slot machine.

Community Development Department Internet Cafes Land Development Code (LDC) amendments –Creates exemption for De Minimis Activity Establishment: operated by an organization exempt from federal taxation under Section 501 (c) of the Internal Revenue Code, and with five (5) or fewer electronic or mechanical devices

Community Development Department Internet Cafes Land Development Code (LDC) amendments –Zoning Districts Prohibit in COM-1, Special Exception in COM-2 (Existing Uses “grandfathered” for Special Exception Use), Permit (As-of-right) in COM-3, and MPD (Part of Development Agreement) –Distance Separation 1,000 feet from churches, parks, and/or schools Measured property line to property line

Community Development Department Internet Cafes Land Development Code (LDC) amendments –Parking Standard 1 space/4 terminals for stand-alone operations

Community Development Department Existing Cafes with 1,000’ Separation Requirements Along Palm Coast Parkway Palm Harbor Parkway Flagler Plaza 1,000 ft. radius around church, school, or public park 500 ft. radius around “café”

Community Development Department Internet Cafes Code of Ordinance Amendment Definitions Consistent with LDC definitions Permitting Limit number in City (9) Operation requires Certificate of Use

Community Development Department Internet Cafes Code of Ordinance Amendment Certificate of Use Application –To be renewed annually with Business Tax Receipt, –$1,000 processing fee, –Application to include: Inventory of equipment, Level 2 Background check for owners and operators of establishments (Statewide and National criminal history check), Certification that software has been tested

Community Development Department Internet Cafes Code of Ordinance Amendment Certificate of Use Application to include: –Affidavit with following: Identity of operator/owners including names of principals, Statement of whether any individuals listed as operator or owner has been convicted of felony (previous 5-years) Verification of distance separation from school, church and/or public park, –Certificate review within 60-days

Community Development Department Internet Cafes Code of Ordinance Amendment Eligibility of Operator: –Permit denied for following: Convicted or plead no contest within five (5) years of application to a: –Felony under Florida Law, –Misdemeanor involving fraud, and –Misdemeanor involving exploitation of vulnerable adult (defined by statutes), –Permit revoked under this ordinance within previous three (3) years, –Application materials are incomplete or untruthful

Community Development Department Internet Cafes Code of Ordinance Amendment Denial of Permit: Operator denied may reapply Operator may appeal to Hearing Officer within 15 calendar days $500 processing fee

Community Development Department Internet Cafes Code of Ordinance Amendment Restrictions on Transfer of Certificate of Use Public Nuisance May be declared public nuisance if site is used on more than two occasions (founded complaint) within a 6-month period: –Assault, burglary, theft, robbery by sudden snatching, distribution of controlled substances & money laundering. –“Founded Complaint” – Review of facts shows preponderance of evidence that a crime has occurred.

Community Development Department Internet Cafes Code of Ordinance Amendment Inspection of Premises Signage Requirements Interior Signs –Permit (Certificate of Use, Business Tax receipt) –Rules for electronic game promotions (rules, prize tables, odds) –“State and local law prohibits … requiring entry fee … No donation or contribution required. …You may obtain free entries upon request …”

Community Development Department Internet Cafes Code of Ordinance Amendment Limitations on Operation of Business –No sale, serving, or consumption of alcohol, –No one under 18 permitted, –No purchase required to enter electronic sweepstakes, –Limitation on number of equipment (100), –No increase in number of equipment, –Hours of operation (10 a.m. to 2 a.m., 7 days a week).

Community Development Department Internet Cafes Code of Ordinance Amendment Safety and Security Requirements Security camera system, Drop safe, Silent alarm, Licensed security guard at night (6:00 p.m. to closing) (Licensing through Department of Agriculture), Transparency of windows for law enforcement. –Compliance with this section within 60 days of adoption of ordinance.

Community Development Department Internet Cafes Code of Ordinance Amendment Penalties Civil penalties not to exceed $500/violation Each day the violation exists shall constitute separate violation

Community Development Department Internet Cafes - Recommendation Staff Recommends Approval PLDRB will review Land Development Code Amendment April 18.