Outlook for skill games darkens as Va. House panel votes for ban

At a committee hearing last week, a Virginia lobbyist told lawmakers that believing so-called games of skill are really about skill is “about like believing in the tooth fairy.”

But Steve Baril wasn’t there to try to convince the General Assembly to ban the thousands of unregulated and untaxed video game terminals that have shown up in convenience stores, bars and truck stops all over the state. He was pushing for something slightly different: Actual slot machines.

“We think what we offer is a superior product,” Baril told a Senate panel dealing with gambling issues. Baril said he was representing a coalition of out-of-state video gaming companies — including Las Vegas-based Golden Entertainment — considering expanding to Virginia.

Representatives for Queen of Virginia, a company that has rolled out an estimated 7,500 slots-like gaming machines that require just enough skill to potentially get around the state’s anti-gambling laws, insisted their machines aren’t the same as what their would-be competitors are offering.

“Ask yourself whether you and your constituents really want to see slot machines and video poker in the bars and restaurants as opposed to games of skill. There is a difference,” said Tom Lisk, a lobbyist representing Georgia-based Pace-O-Matic, the parent company of Queen of Virginia.

Queen of Virginia’s machines feature spinning reels and a tic-tac-toe-style grid that requires players to complete patterns in a set period of time. If the player loses their money, they can continue by completing a secondary game based on memory that requires them to mimic a complex sequence of lights.

When the 2020 session began, it looked like the main skill-game question lawmakers would have to decide was whether to ban the machines or turn them into a moneymaker for the state by regulating and taxing them. But the conversation has quickly gotten more complicated.

A ban is looking unlikely in the Senate, but a House of Delegates subcommittee voted unanimously Tuesday night to advance a bill outlawing the machines. Business owners wearing Queen of Virginia shirts had flooded the meeting room to support a competing bill to sanction the machines and regulate them. 

Lawmakers were unswayed, taking two 8-0 votes going against the wishes of most in the crowd.

Del. Luke Torian, D-Prince William, gave Queen of Virginia a tongue-lashing, saying the company’s failure to get General Assembly approval before rolling out its machines had now put legislators in the position of disappointing the businesses making money off the enterprise.

“If you want to do business in Virginia, you know that there’s a process that we go through,” Torian said. “It’s so unfortunate that we have to be in this position before all of you wonderful people.”

Del. Lamont Bagby, D-Henrico, said his bill to regulate the games would give “the little guy” a piece of the business in addition to deep-pocketed, out-of-state gambling interests.

“This is the only bill that we’ve been discussing in gaming that gives them a leg up, that gives them skin in the game,” Bagby said.

Hermie Sadler, a truck stop owner from Emporia, said the games have been positive for both the businesses that host them and the patrons that enjoy playing them.

“If we lose this, we lose 25 jobs immediately,” Sadler said. “And a lot of these people behind us will be going out of business.”

Del. Lashrecse Aird, D-Petersburg, said there’s another “little guy” that doesn’t get talked about.

“And that’s the individuals who suffer from engaging in these machines too much,” Aird said. “Throughout this entire debate there has been no conversation about addiction.”

The patron of the bill to ban the machines, Del. David Bulova, D-Fairfax, said the legislature essentially has three options: Ban the games, regulate them or go “all in” and allow games of chance to come in and compete with what’s already here.

“What I hope, though, is that just because games of skill have kind of exploded in Virginia that we don’t feel trapped into the policy decision,” Bulova said.

The free-floating gaming machines are one piece of a bigger gambling puzzle the General Assembly is trying to put together this year. The legislature is also facing decisions on whether to legalize casinos and sports betting, adding to the gambling activity the state has already approved through the lottery and Colonial Downs Group, the operator of the New Kent County horse-racing track and a handful of off-track betting parlors.

In the Senate, lawmakers have debated whether to allow the machines in restaurants and truck stops but ban them from convenience stores, where the Virginia Lottery says they’ve been eating into ticket sales that provide funding for public schools.

And amid all the confusion over how to distinguish a game of skill from a game of chance, some lawmakers have concluded the state should stop trying. 

Sen. Jeremy McPike, D-Prince William, the patron of one the skill-game bills being considered, urged his colleagues on the gambling subcommittee to keep the legislation “agnostic” on the skill-versus-chance question.

That caused some whiplash for Sen. Monty Mason, D-Williamsburg, who said he came into the session thinking the legislature would put limits on the unsupervised industry, not give it more fuel.

“It seems like we’re launching the space shuttle here,” Mason said. “When you say agnostic, we’re blowing the cover off of ‘we no longer care whether it’s skill or not.’ It is anything goes.”

“That is correct,” McPike said, adding that the Virginia Lottery Board could regulate all cash-paying games the same way.