ORDERS:
FINAL DECISION
STATEMENT OF CASE
This matter comes before me upon request for a Hearing by the Respondents after being cited
for violating S.C. Code Ann. § 12-21-2804(A)(Supp. 1996). Specifically, the Department alleges that
the Respondents have violated the "one separate employee" requirement of S.C. Code Regs. 117-190
(Supp. 1996) and the penalty sign requirements of Section 12-21-2802 (Supp. 1996). A Hearing was
held before the Administrative Law Judge Division on December 2, 1997.
FINDINGS OF FACT
Having observed the witnesses and exhibits presented at the hearing and closely passed upon
their credibility, taking into consideration the burden of persuasion by the Parties, I make the
following Findings of Fact by a preponderance of evidence:
1. Legal notice of the time, date, place and subject matter of the Hearing was given to the
Petitioner and the Respondents.
2. On October 17, 1996, South Carolina Law Enforcement Division ("SLED") Agent John
Tanner conducted an inspection of the video gaming establishments located at Steve's Hot Dogs,
located at 1221 Augusta Highway in West Columbia, South Carolina. Agent Tanner was
accompanied in his inspection by SLED Agent Konnie Smith. During the course of their inspection,
the Agents observed a commons area, which included a lunch counter and two separate rooms
containing video poker machines. One of these video poker rooms had a large "A" over the doorway
and the second a large "B" in the same location. Game rooms A and B were open and the machines
in these rooms were on and operational. Both game rooms contained five (5) Class III video game
machines.
3. When the SLED officers entered the location, there were no employees in either of the two
video poker rooms. The only employee which the agents observed was located in the commons area
behind the lunch counter. Agents Tanner and Smith played machines located in both rooms. While
the agents played the machines in room A, an employee, Mrs. Boron, entered the game room and
asked if the agents wished to order a drink. After Agent Smith ordered a beer, Mrs. Boron returned
with a beer and left again. No other employees entered either game room while the agents were
playing the video poker machines.
4. Game rooms A and B had retail sales tax licenses issued to Tina Alewine. Additionally, the
Class III Coin Operated Device licenses were all issued to Tina S. Alewine d/b/a Steve's Hot Dogs.
The following Class III licenses were located in Game Rooms A and B:
Game Room A Game Room B
045509 045507
045514 045510
045515 045511
045519 045512
045520 045518
5. I find the Respondents were in violation of S.C. Code Regs. § 117-190 (Supp. 1996) for
failing to have at least one separate employee in the game room premises during business hours.
6. The machines in Room B did not have any penalty signs attached to the machines or on the
wall behind each machine stating penalties as required by S.C. Code Ann. § 12-21-2802 (Supp.
1996), and only three of the five machines located in Room A had any such signs. In all, seven
machines were in violation of Section 12-21-2802.
7. The Department seeks total monetary penalties of Seven Thousand One Hundred and no/100
($7,100.00) Dollars against Tina Alewine. Specifically, the Department seeks a Five Thousand and
no/100 ($5,000.00) Dollar fine for violation of Section 12-21-2804(A) and Reg. 117-190 and Two
Thousand One Hundred and no/100 ($2,100.00) Dollars for the seven violations of the penalty sign
provision contained in Section 12-21-2802. The Department further seeks revocation of ten Class
III machine licenses at the two businesses in question; Tina Alewine d/b/a "Steve's Hot Dogs" Game
Room A (retail license #032-28360-8) and Tina Alewine d/b/a "Steve's Hot Dogs" Game Room B
(retail license #032-28361-7).
8. Tina Alewine has been disciplined for violating the Video Game Machines Act on three
previous occasions. She entered into a consent agreement in SC Department of Revenue and
Taxation v. Tina Alewine, d/b/a Steve's Hot Dogs and Video, Docket No. 95-ALJ-17-0095-CC, in
which she agreed to remove her unlawful advertising and receive a Five Hundred and no/100
($500.00) fine. In South Carolina Department of Revenue and Taxation v. Great Games, Inc., and
Edwin S. Alewine d/b/a Triple Seven and Tina Alewine d/b/a Steve's Hot Dogs and Video, Docket
No. 95-ALJ-17-0185-CC, the Respondent received a Four Thousand and no/100 ($4,000.00) Dollar
fine and revocation of her machine licenses for having more than eight (8) video poker machines at
a "single place or premises." Finally, in South Carolina Department of Revenue v. Edwin S.
Alewine, d/b/a Treasure Land Video, and Tina Alewine, and Great Games, Inc., Docket No. 96-ALJ-17-0520-CC, the Respondent's machine licenses were revoked and she received a Five Thousand
and no/100 ($5,000.00) fine for failing "to meet the 'one separate employee' requirement set forth
in Regulation 117-190."
9. I find that the appropriate penalty in this case is a total fine of Seven Thousand One Hundred
($7,100.00) Dollars (1) against the Respondent, Tina Alewine and revocation of the above Class III
licenses.
CONCLUSIONS OF LAW
Based upon the Findings of Fact, I conclude as a matter of law, the following:
1. The Administrative Law Judge Division has jurisdiction to hear this matter pursuant to S.C.
Code Ann. § 12-4-30 (D) (Supp. 1996) and S.C. Code Ann. § 1-23-320 (Supp. 1996).
2. The Department contends that the Respondents violated S.C. Code Ann. § 12-21-2804(A)(Supp. 1996). That section provides:
After July 1, 1994, the commission [Department] 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.
3. Machines licensed under Section 12-21-2720(A)(3) include video games with a free play
feature operated by a slot in which a coin or thing of value is deposited. S.C. Code Ann. § 12-21-2720 (Supp. 1996).
4. S.C. Code Ann. § 12-21-2804(A) (Supp.1996) states that the penalty for failing to comply
with the maximum number of machines in a "single place or premises" is the revocation of the
licenses of machines located in the establishment.
5. S.C. Code Ann. § 12-21-2804(F) (Supp. 1996) states that a person who violates Section 12-21-2804(A) may be fined up to Five Thousand ($5,000.00) Dollars.
6. The Video Game Machines Act ("Act") does not define the term "single place or premises."
7. The Honorable G. Ross Anderson held that the term "single place or premises" is
"sufficiently defined and susceptible of a common and ordinary meaning to provide a person of
ordinary intelligence a reasonable notice of the prescribed conduct." Reyelt, et al. v. South Carolina
Tax Commission, CA No. 6: 93-1491-3 (D.S.C. July 5, 1994). On June 23, 1995, S.C. Code Regs.
117-190 (Supp. 1996) became effective. It provides as follows:
The Video Game Machines Act, found in Article 20, Chapter
21 of Title 12, limits the number of machines that may be located in
a "single place" or "premises."
A single place or premises must be a fixed location. It does
not include moving property such as a boat or a train, unless such
property is permanently affixed to a specific location.
A "single place" or "premises" means a structure surrounded
by exterior walls or firewalls consistent with the requirements of the
applicable building code (or where no building code is applicable, a
one hour rated firewall), provided such exterior walls and firewalls
may not have any windows, doors or other openings leading to
another area where video game machines are located.
If a structure surrounded by exterior walls has two or more
areas where video game machines are located, each surrounded by
exterior walls or firewalls as defined and required above, the
Department must review all the facts and circumstances to determine
if each area in reality constitutes a single place or premise for video
game machines. In determining whether each entity is in fact a single
place or premises, the Department of Revenue will consider the
following factors: (1) Does each entity have at least one separate
electric utility meter? (2) Does each entity or business have at least
one separate employee on the premises during business hours? (3)
Does each entity or business have a separate local business license
where required? (4) Does each entity or business have a separate
state sales tax license? A positive answer to these four questions is
required for each area to be considered a "single place or premises"
for purposes of The Video Game Machines Act.
8. Regulation 117-190 requires that each business must have a separate employee on the
premises while the business is open. The cardinal rule of statutory interpretation is to ascertain and
effectuate the legislative intent wherever possible. Bankers Trust of South Carolina v. Bruce, 275
S.C. 35, 267 S.E.2d 424 (1980). "Full effect must be given to each section of a statute, giving words
their plain meaning, and, in the absence of ambiguity, words must not be added or taken away."
Hartford Accident and Indem. Co. v. Lindsay, 273 S.C. 79, 254 S.E.2d 301, 304 (S.C. 1979). Thus,
the phrase "on the premise" presumptively must have meaning. The employees of a video poker
business must be sufficiently connected to an open video game room as to indicate that each game
room that is open for business has a specific employee assigned to work solely in that room. I find
that the Respondent's video poker businesses did not have an employee specifically assigned to
either Game Room A or B.
9. S.C. Code Ann. § 12-21-2802 (Supp. 1996) states: "Each machine licensed under this article
(Video Game Machines Act) or Article 19 must have a prominently displayed sign citing the
penalties provided by Sections 12-21-2790, 12-21-2792, and 12-21-2794 on the wall above the
machine or affixed prominently to the machine."
10. Section 12-21-2802 does not specifically provide a penalty. However, S.C. Code Ann. §
12-54-40(b)(3) provides that: "[a] person who is liable to obtain a license or purchase stamps for
identification purposes, who fails to obtain or display the license properly, or who fails to affix the
stamps properly, or fails to comply with statutory provisions, is subject to a penalty of not less than
fifty dollars nor more than five hundred dollars for each failure." S.C. Code Ann. § 12-54-40(b)(3)
(Supp. 1996). Respondent obtained her licenses for her video poker machines pursuant to § 12-21-2720 (A)(3) and therefore her failure to comply with the provisions of § 12-21-2802 subjects her to
the above potential fine.
ORDER
Based upon the Findings of Fact and Conclusions of Law, it is hereby:
ORDERED that the licenses listed in Findings of Fact paragraph four are revoked, and a
fine of Seven Thousand One Hundred ($7,100.00) Dollars is imposed upon Tina Alewine.
IT IS FURTHER ORDERED that no permits shall be issued for any Class III machine to
be operated in any of the above game rooms for a period of six (6) months from the date of this Final
Decision.
___________________________
Ralph King Anderson, III
Administrative Law Judge
Columbia, South Carolina
February 5, 1998
1. Five Thousand Dollars of which is for violation of Section 12-21-2804(A) and Reg. 117-190 and $2,100
of which is for the seven violations of the penalty sign provision contained in Section 12-21-2802. |