Illegal video gambling terminals (VGTs) are making their way into truck stops, convenience stores, and stop-and-go stores across Pennsylvania.
Already, these terminals were creating issues for bars, taverns, hotels and other traditional venues, according to WITF.org. But now competition has left business owners without a choice.
State Police Major Scott Miller, who leads the Bureau for Liquor Enforcement, elaborated to WITF.org:
“We have received information from liquor licensees who have stated that they believe the machines are illegal but have resorted to putting them into their establishments because they are losing business to other licensees who have machines in their facility.”
Vending companies use the “games of skill” distinction to skirt the law. According to Miller though, legal gaming terminals reside in the 12 Pennsylvania casinos.
A legislative deadlock holds up VGT legislation
Here are the reasons why terminals have had a hard stop in Pennsylvania:
- The state legislature pushed for legalization given that many terminals are already in liquor licensed establishments illegally. Republican Guy Reschenthaler, a sponsor of a then-unintroduced Senate bill, said that these 40,000 machines already existed in an “unlicensed, unregulated, untaxed platform.”
- A Bucks County Republican, Chuck McIlhinney, said he hadn’t heard of the issue. He then organized hearings to discuss the issue before legalization is considered, according to CBS Local Philadelphia.
- VGTs remain the sticking point in the gambling expansion bill.
- A plan unveiled in March would allow as many as 40,000 machines in licensed liquor establishments, truck stops, and off-track-betting parlors. The House passed the measure, but the Senate refuses to budge on the issue.
- Projections for said plan were as much as $100 million in the first year and up to $500 million by the fifth year, PennLive reported.
“We need to legalize this industry to bring it out of the shadows,” Reschenthaler said.
Local restaurant and bar owners fight back
Local tavern owners in Harrisburg argue that senators should back the legislation to keep the money local.
Dave and Danette Shultz, owners of Stone Grille and Taphouse and BrewTaGo, posed the following question in a PennLive op-ed:
“Why would anyone in their right mind want to send more money to casino operators and/or raise taxes rather than legalize tavern games and support thousands of local businesses that employ more than 100,000 of our fellow Pennsylvanians?” We don’t want to just play games in our bar, but we are tired of Harrisburg playing games with our livelihood. It’s time to legalize tavern games, balance the state’s budget and let taverns stay open.”
It’s all about the budget
Legalizing video gambling in Pennsylvania would help with state budget concerns, particularly the $2.2 billion budget gap. It could aid in the survival of the bars, corner markets, and any liquor licensed establishment too.
McStew’s owner Tom Tyler told Philly.com that he could bring in $100,000 with five VGTs. These bar owners would need support from the state. That require a more secure return on investment than just a prediction.
Gambling expert Alan Silver, a professor at Ohio University, explained the issue to Philly.com:
“Anytime a state is banking on additional revenue to come from gaming, you’re basically rolling the dice. … There’s no guarantee… You might make $200 million, but you might take away $300 million from the casinos in tax revenue.”
Proponents of the terminals use Illinois, a state with legalized VGTs, as an example. Commonwealth Gaming used assumptions based on Illinois numbers to estimate that the Pennsylvania could bring in as much as $500 million in state taxes and $53 million in county and local taxes. That would be with about 37,000 terminals statewide.