Ban ‘skill games’ in Pennsylvania | Editorial

When it comes to gambling in Pennsylvania, lawmakers continue to push their luck in lining the state’s coffers with money from those who can least afford it. So, it is worth watching two competing bills in Harrisburg.

One measure, proposed by State Sen. Gene Yaw (R., Lycoming), would regulate and tax so-called “skill games,” which are similar to slot machines but are commonly found in taverns, veterans halls, and convenience stores. A second measure, expected from State Sen. Amanda Cappelletti (D., Montgomery and Delaware) would outright ban the machines in which a player’s success is allegedly based on skill, rather than chance.

The bills are backed by competing gambling interests, so the choice comes down to the lesser of two evils. Yaw has received thousands of dollars in campaign contributions from skill game backers who have spent more than $1 million lobbying in Pennsylvania since 2018, while Cappelletti’s measure is backed by the casino industry, which wrote a previous bill for a former lawmaker seeking to bar skill games.

In this instance, banning skill games is the best bet.

» READ MORE: Casinos are still a bad bet in Pa. | Editorial

Kentucky wisely did so earlier this year, but can Harrisburg muster the same courage? After all, the General Assembly has been addicted to gambling for two decades, so it’s hard to imagine lawmakers turning down another opportunity to win more tax revenue from gamblers.

Yaw’s bill has problems beyond normalizing the seedy skill game industry. It would only tax skill game revenue at 16%, compared to 54% for slot machines, leaving millions on the table. Odder still, regulation would be handled by the Department of Revenue while the Bureau of Liquor Control would oversee enforcement.

This makes no sense since the state already has the Pennsylvania Gaming Control Board, which oversees casinos. Why farm it out to two departments that lack gambling expertise?

Yaw estimates taxing the machines could generate $300 million a year while continuing to attract customers to taverns and other small businesses.

Amazingly, Harrisburg has long looked the other way while roughly 50,000 skill games mushroomed across the state without any oversight or regulation. That’s nearly double the number of slot machines in casinos.

Critics argue the lack of oversight allows minors to gamble and attracts trouble. Philadelphia City Councilmember Curtis Jones Jr. testified at a hearing last week that skill game machines are often found in nuisance businesses — establishments that jeopardize neighborhood safety by promoting behavior such as illegal drug sales. A convenience store clerk in Hazleton was murdered in 2020 by a frequent skill game player who knew the store kept large sums of cash for payouts.

The skill game debate is the latest extension of the state’s profligate policy to fund the government off the backs of gamblers. At what point will legislators say enough is enough?

Slots gambling was legalized in 2004 in a dubious way. The initial bill contained just 33 lines about background checks at horse racetracks. Days before passage, the measure was amended, and 145 pages were added that legalized up to 61,000 slot machines in 14 locations. There were no hearings or public input before the bill was quickly passed after midnight on July 4 and signed into law by then-Gov. Ed Rendell, who had long pushed to legalize gambling, starting with a failed effort when he was mayor to bring riverboat casinos to Philadelphia.

Once the slots were up and running, it didn’t take long before legislators — spurred on by lobbyists — added more gambling. In 2010, the state legalized table games, paving the way for full-blown casinos. In 2017, online gambling was approved, essentially bringing casinos to everyone’s cell phone.

» READ MORE: Don’t gamble with kids? The state should heed its own advice | Editorial

The following year, sports gambling arrived, leading to sports books in casinos, racetracks, and a dozen betting apps that have unleashed a barrage of annoying sports betting commercials and in-game promotions.

The endless expansion has turned Pennsylvania into the second-biggest gambling state in the country behind Nevada. Lawmakers tout the record $2.1 billion in tax revenue last year but fail to mention all the players who lose out, including many elderly and repeat gamblers. Nor do they talk about the many lives ruined from bankruptcy and suicide.

The problem is slot machines are designed to hook gamblers, placing Pennsylvania in the addiction business. Studies show 30% to 60% of casino revenues come from problem gamblers. In short, the business model depends on exploiting addiction.

Banning skill games would be a rare small step for Harrisburg lawmakers to put the people they are elected to serve before the lobbyists. Gov. Josh Shapiro has yet to take a position on either bill, but he could be a champion for protecting the most vulnerable Pennsylvanians from the onslaught of more insidious gambling.