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Business Brief: Jacksonville Looks To Stem Internet Cafe Boom

Via Jacksonville Daily Record

Of the hundreds of internet cafes that have opened in strip malls across Jacksonville, only 90 have obtained a certificate of use, according to the city of Jacksonville.

Our Jacksonville Daily Record news partner reports the Planning and Development Department is working with City Council to find a solution to their growth.

Council member Al Ferraro intends to introduce legislation this month that would place a six-month moratorium on issuing certificates of use for anyone trying to open an internet cafe.

“We may not be able to shut them down, but we can stop more from opening up until we have a handle on it,” he said.

Ferraro, who represents District 2 in East Jacksonville, said he’s tired of seeing internet cafes opening “on every corner.”

“We’re not trying to hurt the legitimate businesses,” he said. “Just the ones which are running away and taking advantage of the system.”

Ferraro and other council members said the internet cafes are operating as adult arcades, which are illegal in Florida.

Internet cafes, which allow people to purchase time to access the internet, are legal.

Council members Reginald Gaffney, Joyce Morgan, Ju’Coby Pittman and Randy White joined Ferraro on Tuesday to discuss how to slow the growth of the cafes.

The state cracked down on internet cafes in 2013 after 57 people were arrested and 49 internet cafes were raided during an FBI investigation into the St. Augustine-based charity, Allied Veterans of the World.

State prosecutors alleged the charity’s internet cafes were a front for illegal gambling and money laundering.

Games of chance are allowed at state-approved casinos or racetracks, or if they’re located on Indian reservations, which are exempt from state gambling laws.

Card games, such as Texas Hold’em, are allowed in certain licensed facilities.

Bill Killingsworth, director of the Planning and Development Department, said that of the 140 applications submitted to the city for internet cafes since 2016, only 90 have been approved.

“Obviously, there’s more than 90 of these places in Jacksonville,” he said.

Killingsworth told council members the city suspects that several of the businesses are operating without a certificate of use.

“They understand how to play the game,” Killingsworth said. “They’re not going to get caught unless someone files a complaint with the city.”

He said when complaints are filed, the city can check if the business is operating as it should be.

Those that are shut down, he says, often reopen under a different name in another strip mall.

“We can’t presume that they’re operating an illegal business,” he said. “It’s a challenge.”

According to the city’s application for a certificate of use “game promotions, sweepstakes, drawings by chance, adult arcade amusement centers or similar activities” as described in Florida statutes are prohibited.

Business owners sign an affidavit stating that the business will operate legally.

Although the city passed an ordinance at 2009 regulating internet cafes, state law prohibiting them pre-empts local regulations. Operating an adult arcade is now a criminal matter.

Deputy General Counsel Jason Teal said that enforcement is up to state or local law enforcement agencies.

“There’s not much we can do at the city level,” he said.

Teal said the city’s best chance is to amend zoning codes.

“The purpose of zoning is to keep incompatible uses from being next to each other,” said Teal.

Over six months, Ferraro and others plan to work with the Planning and Development Department to establish new zoning requirements for internet cafes.

Restrictions could ban facilities from being too close to schools or churches; limiting the number of establishments in a given area; banning neon window lights; and restricting the use to a minimum lot size or to stand-alone buildings.

“Everything is on the table,” Ferraro said.

Ju’Coby Pittman represents District 8 residents in Northwest Jacksonville. While she is concerned with the number of internet cafes in her district, she believes banning them outright is not the right move.

“Some of the elderly constituents really like them. It’s fun like any other vice.

“But like other adult vices, we need to regulate them the proper way,” she said.