Virginia Skilled Gaming Path highlights state's troubled gaming industry
Legislation to legalize games of skill in Virginia cleared its first hurdle again this week in Richmond. But the next focus of the law will be on different interest groups vying for control of the Commonwealth's troubled gambling industry.
The Virginia Senate Commerce and Labor Committee voted 10-5 to pass Bill 212 on Monday. The law is intended to establish a legal framework for businesses licensed by the Virginia Alcoholic Beverage Control Board (ABC) to operate skill gaming terminals.
Virginia temporarily legalized controversial slot machines during the pandemic, but approval of the terminals, which are common at gas stations, bars, restaurants and grocery stores, ended on June 30, 2021.
A state judge's ruling allows the machines to continue operating while the legal battle continues. The Virginia Supreme Court concluded after considering an October petition from Attorney General Jason Miares (R) that ongoing litigation alleges the machines are legal games supported by forms of free expression. Being protected, there is a high chance of getting the upper hand.
As a result, the state's Supreme Court reinstated the ban on skill games, in which players, unlike slot machines, are responsible for identifying winning lines on the reels.
SB212 would allow restaurants, bars and convenience stores with an ABC license to house up to five skill slot machines. Truck stops allow 10 devices. Minimum age to enter the competition is 21 years.
Skill game dealers (companies that sell or lease machines) will be required to pay the state a registration fee of $500,000, with annual renewals of $250,000. Skill game operators (route managers who ensure compliance and collect revenue) will pay an upfront fee of $100,000 and an annual renewal fee of $10,000.
Host businesses pay the state just $250 upfront and $100 annually. Once paid, income from skill competitions will be subject to a 15% state tax, the majority of which will go into the state's general fund. Only 2% of tax benefits will be allocated to problem gambling services.
Skill Game Invoice Forward
This week's vote on skill gaming would normally result in the regulation being referred to the Senate Legislation and Technology Committee. The committee is the gambling and gaming arm of the chamber. Yet surprisingly, SB212 was referred to the Senate Finance Committee.
It’s no wonder that Common Law Chairman Sen. Adam Ebbing (D-Alexandria) has been an outspoken critic of games of skill. Business Chairman Sen. Clay Deeds (D-Charlottesville), who voted against the games of skill bill, said he voted to move the measure to the General Law Committee, where it was defeated.
Senator David Marsden (D-Fairfax) also voted against the bill and referred the regulation to the Finance Committee. Marsden supports legislation pushing for a casino in his Tysons district.
Three Virginia casinos object to skill games, saying they discourage playing on slot machines, which are heavily regulated and taxed.
Sen. Louis Lucas (D-Portsmouth) has advocated for expanding gaming for years. She was a driving force behind the move to bring casinos to Peterborough and also believes skilled jobs should be brought back to the many small businesses that rely on these skills during and after the pandemic.
Lucas, a member of the Business and Labor Committee, voted in favor of the Skill Games bill and referred the bill to the Finance Committee. Lucas, who chairs the Finance Committee, is expected to use her political skills to win support for the bill from a second committee and bring it to the Senate floor for consideration.
Before her trade and labor colleagues vote on the Skilled Gaming Bill, she encouraged them not to change the wording of the legislation.
"I hope you don't mess with this bill because I don't want to have to figure this out financially," she said.
Opponent’s concerns
The handful of Business and Labor Committee members who voted against SB212 expressed regulatory concerns.
One of the concerns is how a reasonable person could think supermarket staff have the necessary qualifications to be on the front line of gambling regulation. They will be responsible for assuring the state that minors or problem gamblers who self-exclude themselves from state casinos or sportsbooks do not engage in skill games.
Supporters of games of skill say it amounts to nothing more than enforcing alcohol and tobacco laws. They claim that licensed skill gaming establishments have an incentive to comply with government regulations to avoid costly fines and penalties.
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Source: www.casino.org
