The Portland City Council voted unanimously on October 18 to change the city fee structure for licenses of amusement devices. Under the new amendment, the city will charge $153 for each of the first 25 devices a business has on its premises and $10 for each additional device.
Prior to the vote, the city charged $153 per amusement device or pinball machine a business had on its premises. Whereas the city code previously assessed a fee for pinball machines separate from other amusement devices, the new code does not distinguish between pinball machines and other amusement devices, except for adult amusement devices.
The change goes into effect immediately and applies to all licenses that were pending on or after September 13.
September 13 is the same day Arcadia National Bar filed a liquor license application with the city. Dave Aceto, who attended the October 18 meeting and is one of the bar’s owners, first drew attention to the amusement fee through social media posts.
Arcadia, an arcade-themed bar located in Portland, has been closed during the pandemic but Aceto and co-owner Nicole Costas-Rosa are preparing to reopen at a new location. Before doing so, they had to pay just over $18,000 in licensing fees to the city. Over $15,000 of the fee went towards the 100 pinball machines and video console games the bar plans to have available to its patrons.
The city council voted unanimously to approve Arcadia’s license application at its last meeting.
The city’s license fee for amusement devices and pinball machines is assessed annually and is paid at the time a business applies for a liquor license, but it is not tied to a business’ liquor license. The timing of this is not changed by the recent amendments the city council made.
Aceto spoke at the October 18 council meeting and proposed the city make the fees for amusement devices comparable to the fee for indoor entertainment, which costs $500.
“We have applied for the first time for our $500 indoor entertainment license. For $500 you can have large crowds for music, comedy, and other shows. I would say that’s indoor entertainment much like a video game. I would argue that arcade games fall under this category but you probably don’t want to penalize businesses that have one or two games,” Aceto said.
To avoid running up fees for business with one or two games, he suggested the city charge $50 per game for the first 10 games on a business’ premises and cap the license fee at $500.
Aceto also raised the point that the arcade games he is required to license with the city cause less public disruption than outdoor entertainment licenses.
“I also wanted to bring up the outdoor entertainment license. I’ve sat through enough city council meetings to know that they are an issue for the residents of Portland. Noise complaints, concerned neighbors, and time spent in meetings debating how to handle it. All for 700 dollars. And I’m being asked to pay $15,000 for arcade games no one will ever hear about,” Aceto said.
He noted that it costs him $12,000 to keep games running, on top of the $2,000 per year he pays in taxes. That cost in part comes because he pays a pinball technician, the only person in Maine with qualifications, to come in twice a week to keep the games up and running.
The council discussed whether the $153 per device fee reflected the cost of the amount of work the city needs to do in order to issue a license.
Jessica Hanscombe, the city’s director of permitting and inspections, noted that the $153 fee exists because devices are checked by health inspectors as part of the inspection required for the city to grant a business a license. Hanscombe said that they check for the correct number of devices and check electronics and cords to ensure there are no hazards. She also said inspectors visit a business at least twice a year and examine the premises.
“No one has ever given care to the number of games or inspected electrical supplies,” Aceto said at the meeting.
During the council’s discussion of amending the fee for amusement devices, Hanscombe also stated that Portland requires a license for amusement devices because of state law.
“This actually was an ordinance that we adopted based on a state law. There was a state law that stipulated that all the municipalities in Maine have to license any type of amusement devices,” Hanscombe said.
In a memo provided as supplemental material to the city council during its meeting, Hanscombe referenced Maine Revised Statutes (M.R.S.) 30-A §3981.
The statute recognizes the home rule authority of municipalities and states they “may establish by ordinance licensing procedures, standards and appropriate fees to cover the costs of administration, regulation and enforcement of recreational business activities.”
That statute was created in 2014 as part of a bill related to the budget. The same bill, LD 1858 passed by the 126th Legislature, repealed parts of another section of state law.
The language that was repealed stipulated “[m]unicipal officers may license suitable persons to keep bowling alleys, shooting galleries, pool, bagatelle and billiard rooms therein, in any place where it will not disturb the peace and quiet of a family.” Another chapter in the same title stated that anyone who kept a bowling alley or pool or billiard room forfeited $10 per day it operated without a license.
Several members of the city council expressed concern about the fee structure and whether it really costs $153 per device to inspect pinball machines and other games.
Another point that was raised was the uniqueness of Arcadia’s business model. According to Hanscombe, most businesses in the city that license amusement devices only have one or two and the fees they pay are scaled down.
Despite reservations, the council ultimately chose not to decide on a dollar amount for the fee from the council floor. Though the council voted to approve the amendment to the city code, they may further revise it when they begin negotiations for the city’s fiscal year 2023 budget.
