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Morning Memo: Senate GOP questioned on legality of power grab

TODAY AT THE STATEHOUSE: No votes in the House on Thursday but the Senate is expected to give final approval to a bill to purge the state's boards of any Democratic appointees. Gov. Pat McCrory hosts legislators for a private breakfast and attends two closed-door events in Wake County. Democratic Party Chairman Randy Voller is hosting a morning press conference to lay out his vision for the minority party amid GOP reign.

TEA PARTY GROUP MAY SCREEN GOP U.S. SENATE CANDIDATES: Americans for Prosperity President Tim Phillips said his group may begin to support candidates in Republican primaries, the Daily Caller reports. The move could have implications on North Carolina's U.S. Senate race in 2014 -- which is expected to draw a robust field to challenge Democrat Kay Hagan. Americans for Prosperity is a tea party group that once held close ties to Gov. Pat McCrory's budget director, Art Pope, who led the national board and donated significantly to the organization.

***Thanks for reading the Dome Morning Memo -- more news and analysis of N.C. politics below.***

Video sweepstakes bill unlikely to make much progress

House Speaker Thom Tillis essentially put an end to Rep. Bill Owens effort to push for a tax on video sweepstakes games, as proposed by Gov. Bev Perdue.

The measure -- House bill 1180 -- has received multiple hearings in the House Finance Committee but has yet to make it to the floor. And Tillis is skeptical it ever will this session, saying there is are serious questions being raisedabout it and "not sufficient time to take it up."

Appellate court strikes down video sweepstakes ban

A divided three-judge panel of the state Court of Appeals has struck down North Carolina’s ban on video sweepstakes games.

The judges, in a ruling issued today, said the state legislature has the authority to regulate games of chance. But the way the 2010 law was written, they said, only deals with how the results of games are communicated, rather than the underlying game itself.

“The General Assembly cannot, under the guise of regulating sweepstakes, categorically forbid sweepstakes operators from conveying the results of otherwise legal sweepstakes in a constitutionally protected manner,” the panel wrote in their ruling.

The law forbids video sweepstakes machines from displaying the results of a game on the machines’ screens.

Judges in Wake and Guilford counties have issued conflicting rulings in two different lawsuits challenging the law. Now the matter is surely headed to the state Supreme Court.

Video sweepstakes gambling industry sees opening with Cherokee compact

The gambling compact Gov. Bev Perdue negotiated with the Cherokee Indians is giving the video sweepstakes industry an opening to push for more recognition. 

"As the Governor and Legislature looks at new gaming rights for the Cherokee, we want them to take a second look at the video sweepstakes industry.  The Internet Based Sweepstakes Organization continues to support legislation that would regulate the industry and provide a new stream of reliable tax revenue to the state of North Carolina," said Chase Brooks, president of the Internet Based Sweepstakes Organization of North Carolina.

A state law passed in 2010 prohibits "electronic machines and devices used for sweepstakes purposes," a ban state lawmakers enacted as part of their third attempt to do away with all forms of video gambling. But the law is still mired in legal mush as the N.C. Court of Appeals considers two cases.

In his statement, Brooks said the bulk of the video sweepstakes industry is complying with the new state law, making the court case largely irrelevant.

"Our message is simple, we will find a way to survive," Brooks continued. "There is a valid market for this type of gaming and entertainment. We will adopt to the law and we will continue to operate. We think it is time for the leaders of the state to work with the video entertainment industry to find ways to regulate it and do like they are doing in Cherokee, tax it to generate new revenues with it."

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