NC S1407

Establishes a new Chapter 18D authorizing the North Carolina State Lottery Commission to regulate and oversee video gaming machines in licensed establishments, subject to specific operational and revenue-sharing requirements.

Requires licensed operators to meet eligibility criteria including North Carolina residency for 3+ years, no felony or gambling convictions within 10 years, minimum age 21, and current tax payment status; limits each operator to a maximum of 500 machines statewide.

Restricts video gaming machines to establishments with alcoholic beverage permits, limits placement to 10 machines per establishment, prohibits placement within 50 feet of churches or schools, and requires minimum $5,000 operator license fee (valid 10 years) plus $250 annual per-machine fee.

Allocates video gaming revenues with minimum 48% transferred to the North Carolina State Lottery Fund and maximum 1.5% for Commission administrative expenses; video gaming revenue distributed to vocational training (40%), school nutrition programs (40%), and school building capital fund (20%).

Modifies existing gambling statutes to exempt video gaming machines licensed under Chapter 18D from criminal penalties for slot machines and gambling devices; becomes effective January 1, 2011.