Pennsylvania Convenience Store Owners Say Skill Games Critical to Survival

Posted on: July 27, 2020, 01:57h. 

Last updated on: July 27, 2020, 04:45h.

Devin O'Connor @CasinoorgDevinO Read More
Expertise: Asia Pacific Gaming, Commercial Gaming, Legislation, Politics.

Small convenience store owners in Pennsylvania say skill games — slot-like terminals that have proliferated throughout the Commonwealth — are playing a crucial role in keeping their businesses open.

Pennsylvania Skill gaming machine
A Pennsylvania Skill gaming terminal is seen here available to play inside a grocery store in Harmony. (Image: Keith Srakocic/AP)

Recently, an informal, unnamed grassroots coalition of small convenience store owners has emerged to give small business owners a seat at the table when negotiations regarding the legality of skill gaming devices are being considered.

The little guy needs to say something, and officials need to hear,” Billy Patel, the man responsible for organizing the alliance, told Lancaster Online. “That’s all it is. We need a seat at their table.”

There’s an estimated 15,000 skill gaming machines operating in the Keystone State. Along with convenience stores, they’re commonly found in restaurants and bars, barber salons, and grocery stores. But there are varying opinions on whether the unregulated and untaxed terminals are legal.

The primary difference between a slot machine and skill gaming machine is that after the reels are spun on the latter, the player must identify a winning payline — for instance, matching symbols. Businesses with the devices split winnings with the game manufacturer and distributor.

The machines operate under the brand “Pennsylvania Skill.” They’re manufactured by Miele Manufacturing in Williamsport and distributed by Pace-O-Matic of Pennsylvania (POM of PA). Convenience store owners say the devices provide them with around $2,000 per month in income. Without them, Patel says, he might be forced to close his store and relocate to a state with more favorable regulations.

High Tax Pillar 

Patel says he reached out to numerous small convenience store owners in Pennsylvania who have included the skill gaming machines into their businesses. He explains that about 30 owners have banded together to make their voices heard in Harrisburg that the terminals are proving critical to their sustainability — especially during the coronavirus pandemic.

Pennsylvania has one of the highest tax rates on gasoline sales in the country. For every gallon sold, 58 cents goes to the state. The state also collects $2.60 off each pack of cigarettes.

We are cash cows for the state,” Patel stated. “We’re hurting now. Let us have this, is it too much to ask?”

The state’s powerful gaming industry, however, says Patel’s coalition is asking too much. A group called Pennsylvanians Against Illegal Gambling (PAIG), backed by the state’s 12 brick-and-mortar casinos, says skill gaming machines need to be eradicated.

“The bottom line is slot machines belong in casinos, not in pizza parlors, gas stations, or convenience stores,” said PAIG spokesperson Peter Shelley.

Penn National Gaming, the oldest casino operator in the state, agrees. Spokesperson Eric Schippers told Casino.org recently that the state has long passed its gaming saturation point.

Odd Court Decision

Commonwealth Court Judge Ellen Ceisler ruled in January that the Pennsylvania State Police, which views the skill gaming machines as illegal gambling, could resume raids on businesses to remove the devices.

But in her ruling, Ceisler declared that games of skill do not fall under the state’s Gaming Act, because the law doesn’t govern unlawful gambling. 

“This Court recognizes that unless, or until, POM Games are considered to be illegal gambling devices under the Crimes Code, POM may suffer harms to its reputation and property interests as a result of the seizures,” Ceisler said.

Pace-O-Matic called that a win for its operations.

“We understand the confusion that exists, as law enforcement has a difficult time discerning between what is a legal skill game and what is an illegal gambling device,” said POM spokesperson Mike Barley. “Our commitment is to continue working with the legislature to regulate, tax, and provide strict enforcement of the legal skill game industry.”