H 3962 Session 112 (1997-1998)
H 3962 General Bill, By Edge, Barfield, T. Brown, Keegan, Kelley, Trotter and
Witherspoon
A BILL TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING SECTION
12-21-2729 SO AS TO PROVIDE NOTICE REQUIREMENTS AND PROCEDURES FOR PROTESTING
ISSUING OF PREMISES LICENSE FOR VIDEO GAMES WITH A FREE PLAY FEATURE AND
PROVIDE PENALTIES FOR VIOLATIONS.-SHORT TITLE
04/10/97 House Introduced and read first time HJ-85
04/10/97 House Referred to Committee on Judiciary HJ-86
A BILL
TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA,
1976, BY ADDING SECTION 12-21-2729 SO AS TO PROVIDE
NOTICE REQUIREMENTS AND PROCEDURES FOR
PROTESTING ISSUING OF PREMISES LICENSE FOR VIDEO
GAMES WITH A FREE PLAY FEATURE AND PROVIDE
PENALTIES FOR VIOLATIONS; BY ADDING SECTION
12-21-2805 SO AS TO ALLOW COUNTIES AND
MUNICIPALITIES TO REGULATE VIDEO GAMES WITH A
FREE PLAY FEATURE; TO AMEND SECTION 16-19-60,
RELATING TO THE EXEMPTION FROM APPLICATION OF
THE GAMBLING OFFENSES TO COIN-OPERATED DEVICES
WITH A FREE PLAY FEATURE, SO AS TO CLARIFY THAT
THIS SECTION DOES NOT PROHIBIT STATE OR LOCAL
REGULATION OF THESE MACHINES; TO AMEND SECTIONS
12-21-2720, AS AMENDED, AND 12-21-2746, RELATING TO
COIN-OPERATED DEVICE LICENSES AND COUNTY AND
MUNICIPAL BUSINESS LICENSE TAXES ON
COIN-OPERATED DEVICES, SO AS TO ALLOW COUNTIES
AND MUNICIPALITIES TO IMPOSE LOCAL LICENSE FEES
ON GAMES WITH A FREE PLAY FEATURE, AND TO DELETE
THE PROHIBITION ON MUNICIPAL REGULATION OF THE
NUMBER OF MACHINES; TO AMEND SECTION 12-21-2804,
RELATING TO THE REGULATION OF VIDEO MACHINES, SO
AS TO PROHIBIT LICENSING OF MACHINES IN LOCATIONS
WHERE MORE THAN FIFTY PERCENT OF GROSS PROCEEDS
IS FROM MACHINES, TO DELETE OBSOLETE LANGUAGE,
TO PROVIDE A CIVIL PENALTY FOR ENFORCEMENT,
REDUCE THE CRIMINAL PENALTIES AND PUT THE
JURISDICTION TO TRY THESE OFFENSES IN THE
MAGISTRATES COURTS; TO AMEND SECTION 12-21-2728,
AS AMENDED, RELATING TO MACHINE OPERATORS'
LICENSES, SO AS TO PROVIDE FOR CIVIL AND CRIMINAL
PENALTIES TO ENFORCE THIS LICENSE REQUIREMENT;
AND TO AMEND SECTION 12-21-2791, RELATING TO THE
LIMITATION ON PAYMENTS FOR A TWENTY-FOUR HOUR
PERIOD, SO AS TO PROVIDE CIVIL AND CRIMINAL
PENALTIES FOR VIOLATIONS.
Be it enacted by the General Assembly of the State of South
Carolina:
SECTION 1. Article 19, Chapter 21, Title 12 of the 1976 Code is
amended by adding:
"Section 12-21-2729. (A) The person applying for the license
required by Section 12-21-2728(B) must place a notice at least once
a week for three consecutive weeks in a newspaper of general
circulation in the area in which the person seeks to locate the
proposed single place or premises.
(B) The person applying for the license required by Section
12-21-2728(B) must also place a notice by displaying a sign for
fifteen consecutive days at the site of the proposed single place or
premises. The sign must:
(1) state that a license for the operation of gaming machines is
being sought and that the establishment will be able to issue cash
payouts for winnings from these machines;
(2) tell an interested person where to send a written protest of
the application;
(3) be in bold print;
(4) cover a space at least eleven inches wide and eight and
one-half inches high;
(5) be posted and removed by an agent of the department.
(C) If the department receives any protests to the issuance of the
license under Section 12-21-2728(B) for the proposed single place or
premises, the matter becomes a contested case under Section
1-23-380. Any person filing a protest is a party to the action.
(D) A person required to obtain the license required by Section
12-21-2728(B) who operates a location without the license required
by Section 12-21-2728(B) or after the license required by Section
12-21-2728(B) has been revoked, and any principle of an entity who
allows the operation of a location without the license required by
Section 12-21-2728(B) or after the license required by Section
12-21-2728(B) has been revoked, is guilty of a misdemeanor and,
upon conviction, must be punished by a fine of not more than two
hundred dollars or imprisonment not exceeding thirty days, or both.
Offenses under this subsection are triable in magistrates court."
SECTION 2. Article 20, Chapter 21, Title 12 of the 1976 Code is
amended by adding:
"Section 12-21-2805. Counties and municipalities by ordinance
may not prohibit machines in the jurisdiction but may impose
regulations on machines located within their jurisdiction more
restrictive than those provided in this article including, but not
limited to, number of machines in a single place or premises, limits
on payouts, hours of operation, age of players, proximity
requirements, and further definitions of single place or premises. In
addition to establishing criminal penalties as provided by law for
violations of these ordinances, a county or municipality also may
provide by ordinance for enforcement by means of civil penalties and
seizure of machines operating in violation of ordinances. The
jurisdiction of counties with respect to this section extends only to
unincorporated areas of the county."
SECTION 3. Section 16-19-60 of the 1976 Code is amended to
read:
"Section 16-19-60. Nothing in Section 16-19-40 or 16-19-50
shall extend to coin-operated nonpayout machines with a free play
feature; provided, that nothing herein shall authorize the licensing,
possession, or operation of any machine which disburses money to
the player. Nothing in this section prohibits the regulation of
video games pursuant to Article 20 of Title 12, the Video Games
Machines Act, including the prohibition on payoffs and location of
these machines in counties where such payouts and machines are
prohibited under the local option provisions of that article and the
regulation of these machines by county or municipal ordinances as
provided in that article. Nothing in state law shall be deemed to
preempt city or county regulation of video game machines."
SECTION 4. Subsection (B) of Section 12-21-2720 of the 1976
Code, as last amended by Act 164 of 1993, are further amended to
read:
"(B) No municipality may limit the number of machines
within the boundaries of the municipality. A municipality may
by ordinance impose a license fee on machines licensed pursuant to
subsection (A)(3) of this section in an amount not exceeding ten
percent of the license fee imposed pursuant to subsection (A) for the
equivalent license period."
SECTION 5. Section 12-21-2746 of the 1976 Code is amended to
read:
"Section 12-21-2746. Municipalities and counties may levy a
license tax on the business taxed under this article, but in no case
may a tax so levied exceed one-half of the amount levied by the State
before March 28, 1956."
SECTION 6. Subsections (A) and (F) of Section 12-21-2804 of the
1976 Code, as added by Act 164 of 1993, are amended to read:
"(A) No person shall apply for, receive, maintain, or permit to be
used, and the commission department shall not allow
to be maintained, permits or licenses for the operation of more than
eight machines authorized under Section 12-21-2720(A)(3) at a
single place or premises for the period beginning July 1, 1993, and
ending July 1, 1994. After July 1, 1994, the commission may not
issue nor authorize to be maintained any licenses or permits for more
than five machines authorized under Section 12-21-2720(A)(3)
at a single place or premises. Any licenses or permits issued for
the operation of machines authorized under Section
12-21-2720(A)(3) during the period of July 1, 1993, and July 1,
1994, for a two-year period shall continue in effect after July 1, 1994,
provided that during the period of July 1, 1994, and July 1, 1995, no
person shall maintain at a single place or premises more than eight
machines authorized under Section 12-21-2720(A)(3). No
machine may be licensed or relicensed in any location where the
primary and substantial portion more than fifty percent
of the establishment's gross proceeds is from machines licensed
under Section 12-21-2720(A)(3). The commission
department shall revoke the licenses of machines located in
an establishment which fails to meet the requirements of this section.
No license may be issued for a machine in an establishment in which
a license has been revoked for a period of six months from the date
of the revocation. The term 'gross proceeds' from the machines
means the establishment's portion.
(F) A person violating subsections (A), (B), (D), or (E) of
this section is subject to a fine civil penalty of up to
five thousand dollars to be imposed by the commission
department. The commission department,
upon a determination that the violation is wilful, may refer the
violation to the Attorney General or to the appropriate circuit solicitor
for criminal prosecution,. A criminal violation
under this section is a misdemeanor, and, upon conviction, the
person must be fined not more than ten thousand two
hundred dollars or imprisoned not more than two years
thirty days, or both. Offenses under this section are
triable in magistrates court. The commission
department shall revoke the licenses of any person issued
pursuant to the provisions of Article 19 of this chapter for a violation
of subsection (C) of this section. Revocation is pursuant to the
procedures set forth in Section 12-54-90."
SECTION 7. Section 12-21-2728 of the 1976 Code, as last
amended by Act 501 of 1992, is further amended to read:
"Section 12-21-2728. (A)(1) In addition to all other
licenses required by this chapter, a person who owns or operates
devices described in Sections 12-21-2720 and 12-21-2730 shall
obtain an operator's license biennially as follows:
(1)(a) fifty dollars for devices in Sections
12-21-2720(A)(1) and 12-21-2730;
(2)(b) two hundred dollars for devices in
Section 12-21-2720(A)(2);
(3)(c) two thousand dollars for devices in
Section 12-21-2720(A)(3).
(B)(2) Only one license is required regardless of
the number or type of devices owned or operated, and the cost of that
license is the highest fee enumerated in this section for a device
owned or operated.
(C)(3) The licenses provided by this section are
subject to Section 12-21-2734 and are a condition precedent to
engaging in or the continuing operation of machines described in this
chapter. Failure to remit taxes to the State is justification for the
cancellation of the license provided in this section.
(B)(1) The department, in addition to assessing the machine
owner the civil penalty under Section 12-21-2804(F) for a violation
of Section 12-21-2804(A), shall assess the licensee under this
subsection a separate civil penalty not to exceed five thousand dollars
for a violation at the licensee's location of Section 12-21-2804(A).
The department, upon a determination that the violation is wilful,
may refer the violation to the Attorney General or to the appropriate
circuit solicitor for criminal prosecution, and, upon conviction, the
licensee must be fined not more than ten thousand dollars or
imprisoned not more than two years, or both.
(2) If a person's operator license is revoked under the
provisions of Section 12-54-90 or if a person is convicted under the
provisions of Section 12-21-2729, the person may not be issued a
license for a period of two years and the person may not have a
financial interest, either direct or indirect, in any business in which
the owner of the business is required to obtain a license under this
subsection."
SECTION 8. Section 12-21-2791 of the 1976 Code, as added by
Act 164 of 1993, is further amended by adding a paragraph at the end
to read:
"A person who pays, or allows the payment to, a player of a cash
payout in which the cash value for a free game exceeds five cents or
in which the total number of credits earned for free games exceeds
two thousand five hundred credits for that location for any
twenty-four hour period is guilty of a misdemeanor and, upon
conviction, must be punished by a fine of not more than two hundred
dollars or imprisonment not exceeding thirty days, or both. Offenses
under this section are triable in magistrates court. In addition, the
department may assess a civil penalty of up to two thousand five
hundred dollars and may revoke the owner/operator license for the
single place or premises."
SECTION 9. This act takes effect June 1, 1997.
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