Virginia Skill Gaming Legislation: Key Points in an Unstable Gaming Sector

Quick Intro

The Virginia legislation aimed at reauthorizing skill-based gaming has successfully navigated its initial legislative challenge in Richmond. This development casts a spotlight on the diverse and competing interests vying for dominance in Virginia’s unsettled gaming industry. The Virginia Senate Commerce and Labor Committee advanced Senate Bill 212 with a 10-5 vote on Monday. This bill proposes to re-introduce a legal structure for skill gaming terminals in establishments sanctioned by the Virginia Alcoholic Beverage Control Authority.

What Is The Progress?

During the pandemic, Virginia provisionally allowed these contentious gaming machines, commonly situated in gas stations, bars, restaurants, and grocery stores. However, this permission expired on June 30, 2021. Subsequently, a state judge’s ruling enabled the continuation of these machines amidst a prolonged legal battle.

The Virginia Supreme Court, evaluating a petition from Attorney General Jason Miyares, concluded in October that the ongoing lawsuit asserting the legality of these machines as protected free speech was unlikely to succeed. Consequently, the state’s supreme judicial authority reinstated the prohibition on these skill games, which require players to identify winning reel paylines, differing from traditional slot machines.

Senate Bill 212, if enacted, would permit various establishments, including restaurants, bars, and convenience stores with ABC licenses, to operate up to five skill gaming machines. Truck stops could accommodate 10 devices, with a minimum player age of 21 years. The bill stipulates substantial fees for different stakeholders: skill gaming distributors would be charged a $500k registration fee and $250K for annual renewals, while skill gaming operators would pay $100k upfront and $10k annually. Host venues would incur a nominal $250 initial fee and $100 yearly to the state. After payouts, skill gaming revenues would attract a 15% state tax, primarily benefiting the state’s General Fund, with a minor 2% allocation for problem gambling services.

Skill Games Bill Forwarded

The progress of the skill gaming bill this week would typically lead to its referral to the Senate General Laws and Technology Committee. However, in an unexpected move, SB212 was directed to the Senate Finance Committee. This shift is attributed to the outspoken opposition of skill games by General Laws Chair Sen. Adam Ebbin and Commerce Chair Sen. Creigh Deeds, who also voted against the bill. Sen. David Marsden, advocating for a casino in his district, voted against the bill and its movement to the Finance Committee.

Virginia’s casinos, in contrast, are against skill games, arguing they divert players from their regulated slot machines. Sen. Louis Lucas has been a proponent of gaming expansion and supports reintroducing skill gaming machines for small businesses. She voted for the bill and its transfer to the Finance Committee, which she chairs. Lucas aims to leverage her influence to secure another committee endorsement to advance the bill to the Senate floor.

Before the Commerce and Labor Committee’s vote, Lucas advised against amending the bill’s language, highlighting the complexity of any potential revisions.

Opponents’ Concerns For The Future

Several members of the Commerce and Labor Committee who opposed SB212 raised issues regarding regulation. They questioned the capability of convenience store clerks to enforce gaming regulations and prevent access by minors or self-excluded problem gamblers. Advocates for skill gaming argue that enforcing gaming laws is similar to upholding tobacco and liquor regulations, believing that licensed establishments would comply with state rules to avoid severe fines and penalties.

Economic Impact and Regulatory Challenges

The proposed reauthorization of skill gaming in Virginia raises significant questions about the economic impact and regulatory challenges. There are concerns regarding how the reintroduction of skill games might affect small businesses and the overall gaming market in Virginia.

Additionally, there are debates over the potential benefits and drawbacks of skill gaming machines in terms of revenue generation and social responsibility. The outcome of these discussions will play a crucial role in shaping the future of the gaming industry in Virginia, particularly in balancing the interests of various stakeholders including businesses, regulators, and advocacy groups.

Final Thoughts

The journey of the Virginia skill gaming bill highlights the intricate interplay of legislative processes, gaming industry dynamics, and regulatory considerations. Its eventual fate will not only affect Virginia’s gaming landscape but also reflect broader themes of industry regulation and societal impact.