The firm responsible for Pennsylvania Skill games, the slot-style machines that take up considerable floor area in eateries and pubs, convenience stores, gas stations, retail shopping centers, and supermarkets, claims that its gaming devices do not directly rival casino slot machines.
The commercial gaming sector in the state, which includes 17 physical casinos, iGaming, retail and online sports wagering, fantasy sports, and video gaming terminals, announced its highest May on record, achieving gross gaming revenue (GGR) of almost $521 million. Pace-O-Matic (POM), the software firm from Georgia that created the operating system for Pennsylvania Skill games, released a statement applauding the casinos for their memorable May while also defending its games.
"These numbers show that there is room in the state for both casinos and small businesses that operate skill games to be successful. There is no competition between the two,” declared Mike Barley, a POM spokesperson.
The Pennsylvania Supreme Court will soon evaluate the legality of skill games. State Attorney General Michelle Henry is challenging lower court decisions that assert the games cannot be deemed illegal gambling machines under the state’s Gaming Act because they involve elements of skill.
Casino Sector Disagrees
Barley’s claim that skill games are not vying for the same players is definitely not a viewpoint held by the casinos.
Last week, officials from Parx, the wealthiest casino in the state, announced that they would not proceed with the construction of a $100 million hotel until the legal issues surrounding skill games have been resolved. Parx is currently in the process of acquiring a nearby smaller hotel to provide guests with onsite accommodations.
Barley claims that the casinos are just being avaricious.
"Sadly, $521 million a month is not enough to satisfy the greedy casino industry,” Barley stated. “Instead, they want to kill small businesses, American Legions, volunteer fire companies, Moose Lodges, and other places that count on income from skill games.”
Skill games remain unregulated and untaxed, yet POM and other advocates for skill gaming have urged state legislators to enact laws to establish a regulatory framework for the machines. The income is presently divided among the host enterprise, game creator, producer, and distribution route.
Legislation was halted in the Harrisburg capital due to the ongoing legal dispute over skill gaming, which suggested imposing a 16% tax on the gross revenue from skill games. Governor Josh Shapiro (D) has proposed a significantly elevated rate of 42%.
Barley highlights that a reduced tax is vital for enabling machines to keep supplying essential financial support to small businesses, which have played a role in alleviating inflation.
“These locations could never afford to pay the same tax rate that wealthy casinos pay. Casinos know that but they simply don’t care,” Barley said.
Legality of Skill Games
In late November, Pennsylvania's Commonwealth Court unanimously confirmed a lower court's decision that found skill games do not qualify as gambling games. The court stated that for a game to be considered a gambling activity, chance must outweigh skill in determining its outcome.
"Simply because a machine involves a large element of chance … is insufficient to find the machine to be a gambling device,” Dauphin County Judge Andrew Dowling wrote.
Henry is in disagreement and is requesting the state Supreme Court to reevaluate and categorize skill games as unlawful gambling devices.