Electronic Game Promotion Establishments (Internet Cafes) City Council Public Hearing 1 st Reading April 17, 2012

1. Electronic Game Promotion Establishments (Internet Cafes)City Council Public Hearing1st ReadingApril 17, 2012

2. Internet CafesBackground • 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

3. Internet CafesCurrent 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)

4. 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.

5. 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.

6. 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

7. 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

8. Internet Cafes • Land Development Code (LDC) amendments • Parking Standard • 1 space/4 terminals for stand-alone operations

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

10. Internet CafesCode of Ordinance Amendment • Definitions • Consistent with LDC definitions • Permitting • Limit number in City (9) • Operation requires Certificate of Use

11. Internet CafesCode 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

12. Internet CafesCode 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

13. Internet CafesCode 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

14. Internet CafesCode of Ordinance Amendment • Denial of Permit: • Operator denied may reapply • Operator may appeal to Hearing Officer within 15 calendar days • $500 processing fee

15. Internet CafesCode 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.

16. Internet CafesCode 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 …”

17. Internet CafesCode 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).

18. Internet CafesCode 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.

19. Internet CafesCode of Ordinance Amendment • Penalties • Civil penalties not to exceed $500/violation • Each day the violation exists shall constitute separate violation

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