Rethink Ohio Internet Cafes

Ohio’s new law banning “Internet sweepstakes” gambling has hit a roadblock – and in the long run, that may not be a bad thing.

Hundreds of “Internet cafes” throughout Ohio now offer an alternative to gambling at casinos and racetracks. Patrons pay fees to play games on computers linked to the Internet. Winners get prizes.

Don’t bother to look it up: That’s gambling.

Earlier this year the General Assembly approved a law banning the practice, and Gov. John Kasich signed it into law.

Now, however, opponents of the law say they have gathered enough signatures on petitions to force the issue to be put before voters. For the subject to be decided by referendum, 231,148 valid petition signatures are required. Those involved in the campaign say they have more than 400,000 signatures.

If Secretary of State Jon Husted’s office checks and approves the petitions, the referendum will be on the November 2014 ballot.

Opponents of the new law claim it will shut down many small businesses. But the petition campaign is a highly organized, well-funded one. One man, the owner of Innovative Gaming Corp., donated $350,000 to the committee seeking the vote.

This is high-stakes business, in other words.

But those who disagree with the ban may have a point. If it succeeds, the only legal table and machine gambling in Ohio will be at the relatively few state-sanctioned casinos and racetracks, all owned by big companies.

If gambling is to be viewed as a legitimate business requiring government regulation – as Ohio voters have said should be the case – why is it restricted to only the big casino and racetrack companies? Is there no place for smaller operations?

Not under current state law. Some states, including neighboring West Virginia, have tightly regulated small gambling operations. Like the casinos and racetracks, percentages of their “take” go to local and state governments.

Internet cafes should not be permitted to operate as they do now. But state officials should consider whether there is a place for them – again, with strict regulation and taxation.