State Senator Gene Yaw is circulating a co-sponsorship memo ahead of a new bill aimed at officially legalizing and regulating skill-based games across Pennsylvania. These slot-like games, known as 'Pennsylvania Skill', have become increasingly common in bars, truck stops, and various businesses throughout the state in recent years. Manufactured by Georgia-based Pace-O-Matic (POM), the games argue their legality based on the premise that skill can enhance winning chances. For example, players can position a 'wild' symbol on the reel grid within a set time frame to form winning combinations.
However, not everyone supports this legislation. The state's casino operators, along with the American Gaming Association (AGA) and the Association of Gaming Equipment Manufacturers (AGEM), argue the games are illegal and operate without regulation. They contend the absence of guarantees regarding fairness and protections against money laundering is central to their opposition. Furthermore, skill games are untaxed, thus posing unfair competition to casino slots, for which operators pay a substantial state tax of 54%.
Pennsylvania courts have sided with POM in several cases involving seized games, and the company cites these rulings as proof of their legality. POM argues that the record-breaking revenues of casino slots indicate that skill games are not detrimental to the casino industry. Contrarily, casino operators stress the rigorous background checks and licensing fees they endure, highlighting that companies like Pace-O-Matic are not under the same scrutiny.
Yaw, who has received significant campaign contributions from skill game manufacturers, has attempted to pass legislation legalizing and regulating these games in previous sessions but has yet to succeed. He is supported by bar owners, private clubs, small businesses, and charitable organizations that rely on the revenue generated by the games. Yaw remarked, “Skill games are a piece of the economy in our state. They cannot and should not be ignored.”
Mike Barley, POM's chief public affairs officer, emphasized the importance of legalization and regulation, claiming it could support 15,000 jobs at small businesses and volunteer organizations across Pennsylvania. "We ask lawmakers to pass this measure because it has helped many of these businesses and organizations stay afloat as they deal with inflation and worker shortages," he stated.
The proposed bill would establish a minimum age for players and mandate that machines connect to a central system to ensure accurate tax collection, with a suggested tax rate of 16%. This taxation issue has already prompted state casino operators to file a lawsuit last July, arguing that the lack of a tax on skill games makes their own tax on slot revenues unconstitutional.
At a July conference, experts from the National Council of Legislators from Gaming States deemed the games illegal but acknowledged the challenges of enforcing a ban, estimating approximately 100,000 of these games to be in operation across Pennsylvania.
