HARRISBURG – Video-based skill games found increasingly in convenience stores and similar locations statewide would be banned under legislation announced Monday.

The Pennsylvania Lottery estimates that games cost the lottery $138 million in lost revenue and they confuse players who think they are playing lottery-run games, said Drew Svitko, lottery executive director.

In a statement, former U.S. Rep. Tom Marino, vice president of government affiars/public relations for Pennsylvania Skill, the company operating the skill-based video games, called it “ludicrous” for the lottery to say the games are costing the state money.

“We believe Pennsylvania Skill complements the offering of both the lottery and casino industries,” said Marino, who stepped down from his seat in Congress in January. The state’s lottery and casinos “are coming off record-breaking revenue-generating months and that is at the same time there are over 12,000 legal Pennsylvania Skill amusement devices in the Commonwealth,” he said.

As of today, there are approximately 5,050 Games of Skill machines in Pennsylvania Lottery retailers. The lottery estimates that for every Games of Skill machine placed in a lottery retailer, the lottery loses approximately $2,284 per machine per month. That’s money that would otherwise be directed toward programs and services for older Pennsylvanians.

But unlike the lottery, the state doesn’t tax the games and there is no state regulation mandating how often the games must award prizes, said Maj. Scott T. Miller, director of the Pennsylvania State Police Bureau of Liquor Control Enforcement.

Unlike most gambling devices, these games operate due to legal ambiguity over whether they are permissible as games of skill instead of games of chance, Miller said.

Legislation authored by state Sen. Robert “Tommy” Tomlinson, R-Bucks, would eliminate the ambiguity by explicitly barring the devices.

“I drafted this legislation after learning the impact these machines have on the Pennsylvania Lottery,” Tomlinson 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.”

Under Tomlinson’s bill, a first offense would be a first-degree misdemeanor that carries a fine of at least $5,000 per violation upon conviction. A second offense is also a first-degree misdemeanor that carries a fine of at least $10,000 per violation upon conviction. A third or subsequent offense would be a third-degree felony that carries a fine of at least $15,000 per violation upon conviction. 

These penalties create a deterrent that helps law enforcement address unsanctioned gambling.

State Sen. Scott Martin, R-Lancaster, said that the skill games have been installed even in communities that had otherwise opted out of allowing other state-sanctioned gambling activity.

John Finnerty is based in Harrisburg and covers state government and politics. Follow him on Twitter @CNHIPA.

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