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What Are Those Weird Gambling Machines In Your Local Bar? What You Need To Know About Skill Games

You’ve seen them at the corner store and probably wonder if those Pennsylvania Skill games are legal. The answer’s more complicated than you think.

They are at the convenience store. And, in the corner at the loved-by-locals breakfast spot. At the bowling alley. They are in 21-to-enter dives and bars with family-friendly menus. At each of these places, there are Pennsylvania Skill machines. The games can be played by 18-year-olds, whereas slot machines on casino gaming floors are strictly 21 years or older.

Pace-O-Matic (POM) designs Pennsylvania Skill games, which are distributed by Williamsport, PA,-based-Miele Manufacturing.

It offers several games including:

  • A tic-tac-toe-style puzzle
  • A potentially unlockable bonus session
  • A “follow me” colored dot-matching second phase of gameplay.

If a player successfully plays the Pace-O-Matic game, he or she wins a total of 105% of the original amount spent to play.

Pennsylvania Skill games

Pennsylvania Skill’s homepage touts the legality.

The “legal updates” page on the site has monthly updates from Matt Haverstick of the Philadelphia-based law firm Kleinbard.

An October 2019 update says:

“We are taking additional measures to end harassment by the Pennsylvania State Police, Lottery and Liquor Control Board of Pennsylvania Skill Operators. If any law enforcement of regulatory agency takes action against you, or otherwise tries to tell you that a Pennsylvania Skill device is illegal, please let the Pennsylvania Skill Compliance Team know immediately.”

Skill games legislation draws doubters

In late October, the House Gaming Oversight Committee heard testimony on Rep. Dan Moul’s House bill, which seeks to legalize, regulate, and tax the games.

The PA Lottery and the PA Gaming Control Board (PGCB) expressed serious reservations about Moul’s current version of the bill. Gaming Committee Chairman Jim Marshall, a Republican from Beaver County, said the hearing would hopefully start a dialogue.

PGCB Executive Director Kevin O’Toole testified overseeing skills games is not among the duties of the gaming board as the law is now written. He also said the proposed legislation does not provide a stream of new revenue to fund investigations and licensing in a new area of responsibility. O’Toole also noted the difficulty in assessing the fairness of a skill-based game.

The PA State Police Bureau of Liquor Control Enforcement’s leader, Major Scott Miller, said skills games are seen as illegal gambling within his organization.

He called the current unregulated play “ripe for corruption” because the machines generate millions with no public accounting and no public benefit for the machines in bars. Each machine can generate $500 per week. Miller said he is also concerned about under the table side-deals and loansharking.

Going back in time with skill machines

A 2014 Beaver County case ruled Pennsylvania Skill games legal in 2014. In November 2013, agents of the Pennsylvania Bureau of Liquor Control Enforcement seized a Pace-O-Matic video game device from an Italian-American club in Beaver County. However, the device was returned after a court ruling deemed “the evidence fails to demonstrate that the machine is a gambling device.”

A 2015 House Gaming Oversight Committee Public Hearing addressing the seizure of illegal gambling devices cited two forfeiture cases, including the Beaver County case. At the hearing, Rep. Kill Kortz (D- Allegheny) noted six years ago that the PSP commissioner testified there were 40 to 60,000 machines. This represents a vast difference from the 15,000 machines Butler estimated in his testimony. However, Butler did say it was “very difficult” to come up with the estimate and it “could certainly be more.”

At a June 2019 House Gaming Oversight hearing, lawmakers heard various sides of the debate if skill games threaten the Pennsylvania Lottery and Pennsylvania casinos.

POM Vice President of Government Affairs/Public Relations and Counsel Tom Marino said the company is eager to work on sensible legislation and touted the investments POM made in the community and producing the machines in PA. According to Penn Live, Miele Manufacturing pays taxes on the machines it sells and tries to self-regulate through contracts with its host establishments that require, for example, removal of any illegal machines before the POM games can be placed.

The state taxes casino-based slots at a rate of 54%.

Marino said to Penn Live:

“Our machines are not fixed to win for the House, like the casinos… So a 54% tax would practically wipe out the industry.”

PA Skill games and the PA Lottery

In June 2019, Sen. Tommy Tomlinson (R-Bucks County) introduced Senate Bill 710 to address the “illegal machines” and protect funding for senior programs. Tomlinson, Pennsylvania Lottery officials, Pennsylvania State Police, and senior groups partnered to announce the legislation to combat “illegal Pennsylvania Skill games.”

They said it cost the Pennsylvania Lottery an estimated $138 million in taxes over the past year and put funding for senior programs at risk. The PA Lottery estimates that for every games-of-skill machine placed in a lottery retailer, the PA Lottery loses approximately $2,284 per machine per month.

Pennsylvania Lottery Executive Director Drew Svitko said:

“These illegal machines are creating a huge risk for the older Pennsylvanians who rely upon the programs the Lottery funds. The Games of Skill machines are appearing across the state and we are deeply concerned the harm will only increase. Senator Tomlinson’s legislation will crackdown on the machines and preserve hundreds of millions of dollars that help seniors afford prescriptions, transportation, meals and more.”

The 2017-18 fiscal year was a record-breaker for the Pennsylvania Lottery. They sold more than $4.2 billion in games and paid more than $2.7 billion in prizes to winners generating more than $1 billion to benefit older Pennsylvanians. Two new products, keno and iLottery, contributed to the success.

The most recent ruling on games of skill

On Nov. 20, the Pennsylvania Commonwealth Court confirmed in a ruling that video game machines manufactured and distributed by the POM under the name “Pennsylvania Skill” are considered slot machines under Pennsylvania law. However, Judge Patricia McCullough did not state that POM was in violation of the Gaming Act.

Haverstick replied to PlayPennsylvania‘s request for comment. He said POM expects to have a trial where they demonstrate they are predominately skill.

POM knows the market they can operate within. Haverstick commented:

“There are a lot of competitors and there is a gray market and bad actors. POM isn’t one of them. They take care of all the legal fees for every one of their business partners down to the location level. If you are a POM customer, we are out there fighting for you. We have a legal machine and at least one court has upheld we are a legal machine. We expect soon we’re going get a bigger broader ruling that we are a legal machine.”

Tic-Tac-No: New Bill Comes After Dubiously Legal Skill Games In PA

A new bill with broad support from both the Lottery and PA police hope to clearly criminalize the legally gray games of skill in Pennsylvania bars.

Newly introduced legislation takes aim at so-called “skill games” available at many Pennsylvania bars and gas stations.

Earlier this month, Sen. Tommy Tomlinson in partnership with the Pennsylvania Lottery officials, the Pennsylvania State Police, and senior groups, introduced new legislation to fight back against illegal “skill games.”

These so-called “skill games” can hardly be classified as requiring much skill. In truth, they are very similar to slot machines with games like “matching color blocks” or completion of a tic-tac-toe board.

The Pennsylvania Lottery estimates that it lost $138 million in sales to “skill games”. In turn, this cuts deep into funding for senior programs.

The nitty-gritty of Senate Bill 710

Should Senate Bill 710 pass, it would be a “criminal offense to knowingly make, assemble, maintain, lease, or sell Games of Skill.”

To explain, the first violation is a first-degree misdemeanor. This would carry a fine of at least $5,000 per violation.

Second offenses are also a first-degree misdemeanor. However, second offenses carry a heftier fine of at least $10,000 per violation upon conviction.

Lastly, third or subsequent offenses are third-degree felonies. Third offenses carry the heaviest fine of all at $15,000 per violation upon conviction.

Tomlinson intends to achieve a powerful deterrent for law enforcement to use against unsanctioned gambling with his proposed legislation.

Proliferation of illegal skill games

Without a doubt, these alleged games of skill have long been a thorn in the side of the Pennsylvania Lottery.

According to the PA Lottery press release, there are approximately 5,050 games of skill machines installed at lottery retailers.

In addition, the Pennsylvania State Police Bureau of Liquor Control Enforcement noted that officers found illegal games of skill in every PA county.

Director of Pennsylvania State Police Bureau of Liquor Control Enforcement, Major Scott T. Miller stated:

We continue to see an increase of suspected illegal gambling devices within licensed liquor establishments, but perhaps even more concerning is the illegal gambling happening in convenience stores, strip malls, and shopping centers.

Because of the proliferation in illegal Games of Skill machines, the next logical step taken by PA lawmakers is to strengthen existing law.

Cutting deep into PA Lottery revenue

Although the PA Lottery upped the number of games offered to lottery retailers, like Keno, Xpress Sports, and iLottery, many businesses elect to sticking with “skill games.”

In addition, these problematic “skill games” negatively affect PA Lottery’s largest revenue earner, scratch-off sales. Scratch-off sales account for nearly 70 percent of lottery revenue.

For every game of skill machine, PA Lottery estimates $2,284 lost. As a result, money that would otherwise go toward programs and services for seniors is also lost.

Unfortunately, this is precisely because illegal skill games produce higher rates of return for owners than the lottery. Therefore, these dubious skill games remain rampant throughout the Keystone State.

Drew Svitko, the Lottery’s executive director, is eager to protect the Lottery and funding that supports senior Pennsylvanians.

These machines have the potential to cost the Lottery hundreds of millions of dollars in future harm. It’s imperative that we take action now to protect the funding that supports the programs that older Pennsylvanians rely upon each year.

Court Sides With Lottery On Wire Act, But iGaming Not Out Of The Woods Yet

The New Hampshire District Court sides with the NH Lottery regarding the Department of Justice’s troubling new opinion regarding the Wire Act.

On Monday, the New Hampshire Lottery Commission breathed a sigh of relief as US District Court Judge Paul Barbadoro sided with gambling interests. Specifically, the 60-plus page opinion found in favor of online gambling, lotteries and casinos and against the Department of Justice’s new Wire Act interpretation.

Recall that New Hampshire previously sued the DOJ’s Office of Legal Counsel (OLC) over a revised Wire Act opinion. The core of the revised opinion states that all forms of online gambling violate the Wire Act.

More on the Wire Act decision

On standing

In short, after New Hampshire filed suit, the DOJ responded via a motion to dismiss the case. More specifically, the DOJ claimed the plaintiffs (New Hampshire and the lottery vendors) have no standing to sue. Therefore, there is no right to relief.

Their argument against standing is that New Hampshire and the lottery vendors do not face an imminent threat of prosecution.

Barbadoro effortlessly dismissed the DOJ’s argument on standing.

First, they have openly engaged for many years in conduct that the 2018 OLC Opinion now brands as criminal, and they intend to continue their activities unless they are forced to stop because of a reasonable fear that prosecutions will otherwise ensue. Second, the risk of prosecution is substantial. After operating for years in reliance on OLC guidance that their conduct was not subject to the Wire Act, the plaintiffs have had to confront a sudden about-face by the Department of Justice. Even worse, they face a directive from the Deputy Attorney General to his prosecutors that they should begin enforcing the OLC’s new interpretation of the Act after the expiration of a specified grace period. Given these unusual circumstances, the plaintiffs have met their burden to establish their standing to sue.

Grammatical interpretation

As a reminder, the Wire Act written in 1961 is both outdated and poorly written. Consequently, it allows for various interpretations. Both New Hampshire and the DOJ argue that the “plain language” of the Wire Act support their arguments.

Barbadoro decided “where, as here, a statute is ambiguous, a court must look at more than grammar to determine its meaning.” After a through examination, Barbadoro concluded to limit the Wire Act to sports gambling. In doing so, his decision “avoids significant coherence problems” which could result from the DOJ’s interpretation.

Limitations on the ruling

The Court took specific notice that the parties disagree on whether judgment should be limited to the parties or be a universal ruling. A universal ruling is applicable to anyone affected including Pennsylvania online lottery and online gambling. Of course, the DOJ wants the ruling to apply only to the parties in the case.

While the Court did agree with the DOJ on this particular argument, Barbadoro also noted that judgment binds the parties outside of New Hampshire. This is due to NeoPollard, New Hampshire’s lottery vendor, operating outside of New Hampshire.

How to extend the judgment

However, all is not lost. Previously, the state of Michigan filed an amicus brief. Their argument is to extend relief to non-parties on behalf of the Lottery Commission.

The National Law Review succinctly outlines Michigan’s argument.

The argument was predicated on the fact that New Hampshire, as a member of the Multi-State Lottery Association, benefits financially from the large scale of multi-jurisdictional games such as Powerball. If another state, such as Michigan, shuttered its state lottery, then the overall revenues of Powerball would decline. If the revenues of Powerball decline, then the share of Powerball revenue that New Hampshire receives would decrease. Based on this Michigan argued that the Court should ensure that New Hampshire not suffer any adverse financial effect.

Sadly, New Hampshire did not use this argument. For this reason, Barbadoro stated, “Should the Lottery Commission wish to pursue such relief, however, I am willing to entertain its claim.”

New Hampshire Lottery Commission has 14 days to file the motion. This motion requires the fleshing out of adequate factual and legal arguments.

What now?

Although Barbadoro ruled in favor of New Hampshire, the DOJ can still appeal to the First Circuit Court.

Should the appeal occur, the First Circuit Court has to review the case de novo. This means the court reviews the case anew or independently as if no decision by Barbadoro was previously made.

As a result, the appeals process will take months, if not years to finalize.

PA online poker

So, who benefits most from the ruling on the Wire Act? The answer is Pennsylvania online poker players.

The DOJ’s Wire Act opinion threw Pennsylvania’s expansion of online poker compacting and multi-state lottery games right into violation of their interpretation. Fortunately, Barbadoro’s ruling clears the way for the expansion of online poker in PA should the Pennsylvania Gaming Control Board decide to proceed.

The exciting potential of PA entering the online poker compact would immediately double the amount of online poker players across the four compacted states.

Did Good Karma Help A Woman Win Her Second Big PA Lottery Prize?

Perhaps Peggy Dodson’s good deed is what helped her win a second PA Lottery scratch-off jackpot prize worth $1 million to go with her initial $100,000 prize

Peggy Dodson’s daily habit of buying Pennsylvania Lottery tickets from the same store has paid off big twice, most recently a $1 million win in the Max-A-Million scratch-off game.

Two years ago, the 72-year-old Lancaster County resident stopped at Peterson’s Grocery Outlet in Peach Bottom to purchase a Scratch-Off called Family Feud, which paid out $100,000.

Even with two big wins, she has no plans to stop playing.

Still playing the lottery

“I don’t drink. I don’t smoke. But I love to play the lottery,” she told the Lancaster Online news site after winning on May 23, just before her husband’s birthday.

“I liked that ticket because of the color purple, so it was the first one (on the roll) and it was the million-dollar winner!” Dodson told lottery officials.

“I cried, I couldn’t help it. I just thank God. We’re going to pay our mortgage off, we’ll pay our truck off, and we’ll go to the Grand Canyon and Alaska!”

The odds of winning $1 million in Max-A-Million are 1 in 1,320,000, according to the Pennsylvania Lottery.

Beating long odds of the Lottery

Still, something more than odds might explain her wins.

Dodson’s winning way previously sounds as if that could explain her second big win. But statistically, that’s just not the case, a Harvard University professor cautioned.

“If someone already wins the lottery, then the chance that the person wins the lottery a second time will be exactly the same as the probability they win the lottery if they had not previously won the lottery before,” statistics professor Dr. Mark Glickman told CNBC Make It.

“In other words, having previously won the lottery does not improve or make less likely the chance of winning the lottery in the future.”

Dodson has followed the advice of most financial experts and took the lump sum payout, rather than taking multi-year annuity payments.

Like all lottery wins above $5,000, Dodson faces a minimum federal tax hit of 24% and Pennsylvania state taxes of roughly 3%.

More tickets mean slightly better odds

Because each game is independent, the only way to improve odds is by buying more tickets for each game. That’s still a huge longshot, Professor Lew Lefton, a faculty member at Georgia Tech’s School of Mathematics, explained to CNBC.

Dodson routinely bought multiple tickets. Lefton said investing more money in a higher number of tickets might not be worth the expense.

“My advice is don’t play the lottery and expect to win,” Lefton added. “You should only be willing to spend what you can afford to lose,” advice he offers on all gambling.

Karma of kindness?

Good karma may be a better explanation – even if statistics don’t take the intent of deeds into account.

While scratching off tickets at Peterson’s convenience store Dodson noticed a customer without enough money to pay for a soda, according to LancasterOnline.

Dodson paid a cashier the difference and went back to scratching –minutes before she won $1 million.

PA Lottery’s Fast Play Gave One Player A $1.5 Million Instant Win

The relatively new instant win game Fast Play awarded one PA Lottery player a record prize of $1.5 million dollars as quickly as a snap of the fingers.

A lucky winner snagged a Pennsylvania Lottery Extreme Green progressive top winning prize ticket of more than $1.5 million on April 17, 2019. This is the largest progressive top prize won since Pennsylvania Lottery Fast Play games’ inception in February 2017.

The innovation of PA Lottery’s Fast Play

Pennsylvania Lottery launched Fast Play in February of 2017. Fast Play is unique and unlike traditional scratch-off lottery tickets. It offers an instant win without having to scratch off a ticket or wait for a drawing.

Players can print tickets from any lottery terminal or touch screen self-service terminal. After that, to check for winning tickets, players can conveniently use scanners at any lottery retailer or use the official PA Lottery mobile app.

More games and chances to win

Fast Play only offered four games on launch. Now, it has steadily grown and expanded game offerings with 14 different games.

Also, Fast Play now offers a second chance at winning prizes with a Fast Frenzy Second Chance Drawing. Simply enter any non-winning ticket for a second and instant chance to win.

Don’t forget that all prizes have to be claimed within a year.

The FRENZY is just getting started! Enter your non-winning Cash Frenzy Fast Play tickets for your chance to win up to $10,000! https://t.co/kxt7oZZhXW pic.twitter.com/mJWmPDFtT2

The recent growth of PA Lottery’s other games

Pennsylvania Lottery started to offer online games with the passage of a gambling expansion law in October 2017. Online games appeal to a younger demographic who are more electronic savvy with cell phones and tablets. In addition, the ease and convenience appeal to everyone.

PA online lottery

The PA iLottery offers a variety of instant win online scratch-off games. Like Fast Play, the games offer the satisfaction of an instant win.

If you want to give the PA iLottery a try, sign up for an account and get a free $5 using the bonus code PLAY 5.

Tag: online lottery What Are Those Weird Gambling Machines In Your Local Bar? What You Need To Know About Skill Games You’ve seen them at the corner store and probably wonder if those ]]>