A BILL TO BE ENTITLED
AN ACT to end nuisances of unlawful gaming houses by requiring payment of storage and disposal fees for seized gaming machines, authorizing seizure of vehicles used to transport illegal gaming machines, modifying the definitions of video gaming machine and electronic sweepstakes machines, and modifying the penalty for illegal possession of certain gaming machines.
The General Assembly of North Carolina enacts:
SECTION 1.  This act shall be known as the End Nuisances of Unlawful Gaming Houses Act.
SECTION 2.  G.S. 14‑298 reads as rewritten:
"§ 14‑298.  Seizure of illegal gaming items.
Upon a determination that probable cause exists to believe that any gaming table prohibited to be used by G.S. 14‑289 through G.S. 14‑300, any illegal punchboard or illegal slot machine, any video game machine prohibited to be used by G.S. 14‑306 or G.S. 14‑306.1A, any game terminal described in G.S. 14‑306.3(b), or any electronic machine or device using an entertaining display in violation of G.S. 14‑306.4 is in the illegal possession or use of any person within the limits of their jurisdiction, all sheriffs and law enforcement officers are authorized to seize the items in accordance with applicable State law. Any law enforcement agency in possession of that item shall retain the item pending a disposition order from a district or superior court judge. Upon application by the law enforcement agency, district attorney, or owner, and after notice and opportunity to be heard by all parties, if the court determines that the item is unlawful to possess, it shall enter an order releasing the item to the law enforcement agency for destruction or for training purposes and shall order the owner to pay the reasonable costs of storage and disposal incurred by the seizing law enforcement agency. If the item was seized for use as evidence in a criminal action or proceeding against the owner of the item, upon any plea of guilty or nolo contendere in that action or proceeding by the owner of the item, the court shall order the owner to pay the reasonable costs of storage and disposal incurred by the seizing law enforcement agency. If the court determines that the item is not unlawful to possess and will not be used in violation of the law, the item shall be ordered released to its owner upon satisfactory proof of ownership. The foregoing procedures for release shall not apply, however, with respect to an item seized for use as evidence in any criminal action or proceeding until after entry of final judgment."
SECTION 3.  G.S. 14‑299 reads as rewritten:
"§ 14‑299.  Property exhibited by gamblers to be seized; disposition of same.
Except as provided in Chapter 18C of the General Statutes or in G.S. 14‑292, all moneys or other property or thing of value exhibited for the purpose of alluring persons to bet on any game, or used in the conduct of any such game, including any motor vehicle (i) used in the conduct of a lottery within the purview of G.S. 14‑291.1 or (ii) used to transport any video game machine prohibited by G.S. 14‑306 or G.S. 14‑306.1A, or any electronic machine or device prohibited by G.S. 14‑306.4, shall be liable to be seized by any court of competent jurisdiction or by any person acting under its warrant. Moneys so seized shall be turned over to and paid to the treasurer of the county wherein they are seized, and placed in the general fund of the county. Any property seized which is used for and is suitable only for gambling shall be destroyed, and all other property so seized shall be sold in the manner provided for the sale of personal property by execution, and the proceeds derived from said sale shall (after deducting the expenses of keeping the property and the costs of the sale and after paying, according to their priorities all known prior, bona fide liens which were created without the lienor having knowledge or notice that the motor vehicle or other property was being used or to be used in connection with the conduct of such game or lottery) be turned over and paid to the treasurer of the county wherein the property was seized, to be placed by said treasurer in the general fund of the county."
SECTION 4.  G.S. 14‑306(a) reads as rewritten:
"(a)	Any machine, apparatus or device is a slot machine or device within the provisions of G.S. 14‑296 through 14‑309, if it is one that is adapted, or may be readily converted into one that is adapted, for use in such a way that, as a result of the payment of any piece of money or coin or token or any credit card, debit card, prepaid card, or any other method that requires payment to activate play, whether directly into the slot machine or device or resulting in remote activation, such machine or device is caused to operate or may be operated in such manner that the user may receive or become entitled to receive any piece of money, credit, allowance or thing of value, or any check, slug, token or memorandum, whether of value or otherwise, or which may be exchanged for any money, credit, allowance or any thing of value, or which may be given in trade, or the user may secure additional chances or rights to use such machine, apparatus or device; or any other machine or device designed and manufactured primarily for use in connection with gambling and which machine or device is classified by the United States as requiring a federal gaming device tax stamp under applicable provisions of the Internal Revenue Code. This definition is intended to embrace all slot machines and similar devices except slot machines in which is kept any article to be purchased by depositing any coin or thing of value, and for which may be had any article of merchandise which makes the same return or returns of equal value each and every time it is operated, or any machine wherein may be seen any pictures or heard any music by depositing therein any coin or thing of value, or any slot weighing machine or any machine for making stencils by the use of contrivances operated by depositing in the machine any coin or thing of value, or any lock operated by slot wherein money or thing of value is to be deposited, where such slot machines make the same return or returns of equal value each and every time the same is operated and does not at any time it is operated offer the user or operator any additional money, credit, allowance, or thing of value, or check, slug, token or memorandum, whether of value or otherwise, which may be exchanged for money, credit, allowance or thing of value or which may be given in trade or by which the user may secure additional chances or rights to use such machine, apparatus, or device, or in the playing of which the operator does not have a chance to make varying scores or tallies. Each game console, play station, or other access point allowing a person to operate a slot machine shall constitute a separate machine or device."
SECTION 5.  G.S. 14‑306.1A reads as rewritten:
"§ 14‑306.1A.  Types of machines and devices prohibited by law; penalties.
(a)	Ban on Machines. – It shall be unlawful for any person to operate, allow to be operated, place into operation, or keep in that person's possession for the purpose of operation any video gaming machine as defined in subsection (b) of this section, except for the exemption for a federally recognized Indian tribe under subsection (e) of this section for whom it shall be lawful to operate and possess machines as listed in subsection (b) of this section if conducted in accordance with an approved Class III Tribal‑State Compact applicable to that tribe, as provided in G.S. 147‑12(14) and G.S. 71A‑8.
(b)	Definitions. – As used in this section, a video gaming machine means a slot machine as defined in G.S. 14‑306(a) and other forms of electrical, mechanical, or computer games such as, by way of illustration and not exclusion:
(1)	A video poker game or any other kind of video playing card game.
(2)	A video bingo game.
(3)	A video craps game.
(4)	A video keno game.
(5)	A video lotto game.
(6)	Eight liner.
(7)	Pot‑of‑gold.
(8)	A video game based on or involving the random or chance matching of different pictures, words, numbers, or symbols not dependent on the skill or dexterity of the player.
(8a)	A video game based on or involving the random or chance matching of different pictures, words, numbers, or symbols, not dependent on skill or dexterity that is played in conjunction with revealing a prize as the result of an entry into a sweepstakes, or with any other offering of an opportunity to obtain anything of value.
(9)	Any other video game whether dependent on chance or dependent on skill or dexterity that is played in conjunction with revealing a prize as the result of an entry into a sweepstakes or with any other offering of an opportunity to obtain anything of value.
(10)	A video slot game.
For the purpose of this section, a video gaming machine is a video machine which requires deposit of any coin or token, or use of any credit card, debit card, prepaid card, or any other method that requires payment, whether directly into the video gaming machine or resulting in remote activation, to activate play of any of the games listed in this subsection.
For the purpose of this section, a video gaming machine includes those that in actual operation, limit to eight the number of accumulated credits or replays that may be played at one time and which may award free replays or paper coupons that may be exchanged for prizes or merchandise with a value not exceeding ten dollars ($10.00), but may not be exchanged or converted to money, unless conducted in accordance with an approved Class III Tribal‑State Compact applicable to that tribe as provided in G.S. 147‑12(14) and G.S. 71A‑8.
For the purpose of this section, a video gaming machine does not include those that do not emit, issue, display, print out, or otherwise record any receipt, paper, coupon, token, or other form of record which is capable of being redeemed, exchanged, or repurchased for cash, cash equivalent, or prizes, or award free replays.
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(g)	Definition. – For purposes of this section, the terms "device dependent on skill or dexterity" and "sweepstakes" are as defined in G.S. 14‑306.4."
SECTION 7.  G.S. 14‑306.4 reads as rewritten:
"§ 14‑306.4.  Electronic machines and devices for sweepstakes prohibited.
(a)	Definitions. – For the purposes of this section, the following definitions apply:
(1)	Device dependent on skill or dexterity. – A device where the element of chance is not present in such a manner as to thwart the exercise of skill, dexterity, or judgment.
(1a)	Electronic machine or device. – A mechanically, electrically or electronically operated machine or device, that is owned, leased or otherwise possessed by a sweepstakes sponsor or promoter, or any of the sweepstakes sponsor's or promoter's partners, affiliates, subsidiaries or contractors, that is intended to be used by a sweepstakes entrant, that uses energy, and that is capable of displaying information on a screen or other mechanism. This section is applicable to an electronic machine or device whether or not:
a.	It is server‑based.
b.	It uses a simulated game terminal as a representation of the prizes associated with the results of the sweepstakes entries.
c.	It utilizes software such that the simulated game influences or determines the winning or value of the prize.
d.	It selects prizes from a predetermined finite pool of entries.
e.	It utilizes a mechanism that reveals the content of a predetermined sweepstakes entry.
f.	It predetermines the prize results and stores those results for delivery at the time the sweepstakes entry results are revealed.
g.	It utilizes software to create a game result.
h.	It requires deposit of any money, coin, or token, or the use of any credit card, debit card, prepaid card, or any other method of payment to activate the electronic machine or device.
i.	It requires direct payment into the electronic machine or device, or remote activation of the electronic machine or device.
j.	It requires purchase of a related product.
k.	The related product, if any, has legitimate value.
l.	It reveals the prize incrementally, even though it may not influence if a prize is awarded or the value of any prize awarded.
m.	It determines and associates the prize with an entry or entries at the time the sweepstakes is entered.
n.	It is a slot machine or other form of electrical, mechanical, or computer game.
(2)	Enter or entry. – The act or process by which a person becomes eligible to receive any prize offered in a sweepstakes.
(3)	Entertaining display. – Visual information, capable of being seen by a sweepstakes entrant, that takes the form of actual game play, or simulated game play, such as, by way of illustration and not exclusion:
a.	A video poker game or any other kind of video playing card game.
b.	A video bingo game.
c.	A video craps game.
d.	A video keno game.
e.	A video lotto game.
f.	Eight liner.
g.	Pot‑of‑gold.
h.	A video game based on or involving the random or chance matching of different pictures, words, numbers, or symbols not dependent on the skill or dexterity of the player.
i.	A video game based on or involving the random or chance matching of different pictures, words, numbers, or symbols, not dependent on skill or dexterity that is played in conjunction with revealing a prize as the result of an entry into a sweepstakes, or with any other offering of an opportunity to obtain anything of value.
j.	Any other video game whether dependent on chance or dependent on skill or dexterity that is played while revealing a prize as the result of an entry into a sweepstakes or with any other offering of an opportunity to obtain anything of value.
k.	A video slot game.
(4)	Prize. – Any gift, award, gratuity, good, service, credit, or anything else of value, which may be transferred to a person, whether possession of the prize is actually transferred, or placed on an account or other record as evidence of the intent to transfer the prize.
(5)	Sweepstakes. – Any game, advertising scheme or plan, or other promotion, which, with or without payment of any consideration, a person may enter to win or become eligible to receive any prize, the determination of which is based upon chance.
(b)	Notwithstanding any other provision of this Part, it shall be unlawful for any person to operate, place into operation, or possess for the purpose of operation, an electronic machine or device to do either of the following:
(1)	Conduct a sweepstakes through the use of an entertaining display, including the entry process or the reveal of a prize.
(2)	Promote a sweepstakes that is conducted through the use of an entertaining display, including the entry process or the reveal of a prize.
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SECTION 8.  G.S. 14‑309 reads as rewritten:
"§ 14‑309.  Violation made criminal.
(a)	Except as otherwise provided in this section, any person who violates any provision of G.S. 14‑304 through 14‑309 is guilty of a Class 1 misdemeanor for the first offense, and is guilty of a Class H felony for a second offense and a Class G felony for a third or subsequent offense.
(b)	Notwithstanding the provisions of subsection (a) of this section, any person violating the provisions of G.S. 14‑306.1A involving the operation, or the possession for the purpose of operation, of five or more machines prohibited by that section is guilty of a Class H felony for a first or second offense and a Class G felony for a third or subsequent offense.
(c)	Notwithstanding the provisions of subsection (a) of this section or G.S. 14‑306.4, any person violating the provisions of G.S. 14‑306.3(b) or G.S. 14‑306.4(b) involving the possession of five or more machines prohibited by those subsections is guilty of a Class H felony for a first or second offense and a Class G felony for a third or subsequent offense."
SECTION 9.  This act becomes effective December 1, 2019, and applies to offenses committed and seizures occurring on or after that date.