Pennsylvania fraternal clubs and nonprofit organizations have clamored for loosening of the regulations that cover the small games of chance through which they raise funds.
Amusement machine vendors and licensed liquor establishments have sought clear state law permitting the “skill” games that have popped up around the commonwealth, letting people in non-casinos play a device that’s similar to a slot machine but has more player interaction.
Legislation that would address both issues — while expanding legalized gambling still more outside the ever-broadening scope of casino gaming — is the subject of a House Gaming Oversight Committee hearing in the state Capitol Wednesday morning.
House bill serves as tool to start discussion
Committee Chairman Jim Marshall, a Beaver County Republican, said the hearing is no endorsement of House Bill 1598, a broad measure that he’s not interested in enacting as is. But it brings up a number of topics important to legislators and their constituents that are worth discussion, he said, and serves as a good vehicle to start that debate in the legislative session that runs into 2020.
“I would be in favor of a bill in the future that would simplify games of chance, and this bill is one that offers the ability to gather more information and hear the opinions of stakeholders,” Marshall said.
Under the 1988 Small Games of Chance Act, hundreds of fraternal clubs, veterans organizations, volunteer fire companies, and other nonprofits are licensed by the state to raise money through raffles, drawings, punchboards, and similar small-time gambling. Amendments to the law allow taverns to do the same.
Rep. Dan Moul, a Republican from Gettysburg, is sponsor of the House bill that he says aims in part to give organizations more leeway in operating the games in terms of what they can offer and how much they can pay out on one event or in a given week.
The public would be the beneficiary from raising the current ceiling of $35,000 on maximum weekly prizes and $2,000 for a given game, Moul said, as clubs are required to direct at least 60% of their proceeds to “public interest purposes.” His district includes some organizations with thousands of members that bump up against the current limits and could do more for the community if allowed the chance to increase games and prizes, Moul said.
The bill would allow them certain games not specifically allowed by law presently, such as vertical wheels and poker runs.
More controversy exists around skill games
A provision likely to receive more attention would legalize and regulate the “skill” machines, thousands of which exist in all kinds of establishments in the state under a gray area of law. Manufacturers and suppliers contend the devices are not illegal gambling because a player’s decisions, and ability in aspects such as memory, affect the potential to make money instead of leaving it to total chance as slot machines do.
The casino industry and Pennsylvania Lottery have contended the games are improper competition and want them banned. Law enforcement officials have generally held them to be illegal while hoping for further clarification from the Legislature, in light of a Beaver County judge’s opinion to the contrary in a 2014 court case.
Moul said it only makes sense to bring the games under control, to the benefit of clubs and liquor licensees that could have up to five machines under his bill while excluding them from places that don’t fall under the Small Games of Chance Act.
“The machines are showing up everywhere, even laundromats,” he said. “We should keep them to the nonprofits and private clubs where the money is used to advance the community, not somebody’s paycheck. That’s what the small games of chance law has been about from day one … We can’t have them in every laundromat and restaurant like the wild, wild west.”
Other bills have circulated in both the House and Senate to ban the skill games entirely. Those have the backing of Pennsylvania Lottery officials, who contend they are siphoning off funds people would otherwise wager on lottery tickets. Many lottery retailers have the skill games in their establishments.
In introducing a bill in June to outlaw the games, which has not received action, Sen. Tommy Tomlinson, a Bucks County Republican, said, “I am concerned about the negative effect these unregulated, unlicensed, untaxed gambling machines have on unsuspecting players, youth, and Lottery funds which support essential services for our senior citizens.”
Games are a gray area to be addressed
Marshall, chair of the House committee, said there’s no clear consensus yet among lawmakers on how to address the skill games issue. Many would prefer licensing and regulation to an outright ban, he said.
“I think there’s agreement there’s too broad of a gray area right now,” he said. “I don’t really have a definitive position on where these skill games should be, if there is even a place for them. I want to hear from my committee members, and if we can come up with a collective position on this, then move forward.”
Mike Barley, a spokesman for companies providing the brand known as Pennsylvania Skill games, said the Moul legislation “is a step in the right direction” but the industry is awaiting introduction of a separate measure that could go further.
“We’d like to see the skill game industry be regulated and have additional enforcement upon it and create a path for small business and fraternal clubs and others to create jobs and help the state,” Barley said, speaking on behalf of the Miele Manufacturing and Pace-O-Matic firms.
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