Slot-like Skill Games Under Assault by Lawmakers in Kentucky

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After legal victories in Pennsylvania where slot-like skill games have been deemed legal by judges while law enforcement officials have been criticized for seizing them and the cash they contain without cause, the same types of games are still under fire in the state of Kentucky.

After failing to pass legislation that would have outlawed the games a year ago, another bill intent on defining them as gambling devices was tabled by the House of Representatives on Friday but returned to the floor Wednesday, picking up momentum to pass on a vote of 64-32.

House Speaker David Osborne made a motion Wednesday to resume discussion on House Bill 594 after rumors of its demise were celebrated by proponents of the so-called gray machines over the weekend.

Skill Games are Currently Legal

Kentucky law does not directly address the games which rely on elements of player skill to award prizes, placing them in a gray area of gambling unless the bill makes it to the governor’s desk and receives his signature or a veto is overridden. The bill went to the Senate for deliberation as this year’s legislative session is about to come to an end.

Most of the “work” on passing the bill appears to have occurred behind the scenes as there was very little discussion on the House floor before lawmakers voted 2:1 to outlaw the machines which are found in hundreds of locations across the state,

Speaker Osborne said in a statement after the bill passed the House: “Today’s House vote sends a clear message that there is no place for gambling entities that skirt the law in order to flood Kentucky with unregulated casino-style gaming without limit or oversight,” according to local reports.

Representatives of the Kentucky Merchants and Amusement Coalition, which is one of the entities that lobbied to keep the bill from becoming law expressed their disappointment in the action and called the development “unfortunate” after “so many Kentucky small business owners contacted their legislators about the benefits of skill games.”

The group’s president, Wes Jackson said in a statement: “We are hopeful that our supporters in the Senate will put this dangerous ban bill to rest, putting the needs of actual Kentuckians, not the profits of big business, first.”

Lottery Official Fear Reduced Sales

One of the most powerful opponents of the machines is the Kentucky State Lottery, which claims that the skill games hurt its sales. The lottery, launched in 1989, claims it has contributed over $4.4 Billion to education in Kentucky.

Louisville’s WDRB reports that 27 cents of every dollar gambled on the lottery goes to the commonwealth for college scholarships and grant programs, six cents is shared with retailers, six cents is spent on “administrative costs”, and 61 cents is paid back to winners. It’s unclear if the sale of infrastructure such as bridges helps the Kentucky Lottery Corporation make ends meet.

Proponents of the machines have argued for regulation of the machines that are deployed in multiple states and Mike Barley, chief public affairs officer for skill gaming machines developer Pace-O-Matic stated last week: “Our legal skill games serve as an important lifeline to small businesses with fraternal clubs. They provide consistent, reliable, and supplemental revenue for these establishments at a time they need it most.”

Lottery officials maintain there are over 1,500 of the machines in locations where the Kentucky Lottery sells its products.

It’s unclear whether lottery sales have surged along with other forms of gambling in Kentucky as is the case in most states as the economy has roared back to life after a pause for the pandemic. Other states with commercial gambling as well as skill game machines scattered throughout their landscapes, such as Pennsylvania have seen record gambling revenues. Even Nevada has posted record revenue for January after a record-breaking year as private enterprise works hard to feed the appetite of a populace with rapidly evolving views on gambling.

A spokesman for Kentuckians Against Illegal Gambling said in a statement: “Passing HB594 is the only certain and viable option to prevent every restaurant, gas station, and convenience store in the commonwealth from becoming a mini-casino.”

Osborne’s party has a supermajority in both houses of congress so even a veto by Kentucky’s Democratic governor is unlikely to be of much help to proponents of the machines.

Source: Proposal to ban slot-like machines clears Kentucky House, AP News, March 8, 2023

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