A group of small business owners headed by the Virginia Amusement Coalition rallied on the steps of Capitol Square in Richmond last week to pressure Governor Glenn Youngkin to sign legislation passed by the General Assembly with bipartisan support to legalize, regulate and tax so-called “skill games.”
Skill games, slot-like machines purporting to use an element of skill, spread as unregulated gaming machines before being banned by the Virginia Legislature in 2020, around the same time that the state legalized construction of casinos for the first time. But then-Governor Ralph Northam in 2021 backed a one-year delay of the ban due to economic pressures created by Covid-based shutdowns of many businesses.
An effort to declare the ban unconstitutional led to a Virginia judge issuing an injunction to block enforcement of the ban in December 2021, but that injunction was subsequently lifted, and last November, the state began enforcement of the law, requiring hundreds of small businesses to shut down the machines.
This year, those business owners succeeded in bringing bills to legalize and tax the games to the floors of each chamber of the General Assembly. However, Youngkin stated publicly that he was dissatisfied with both the House and Senate legalization bills. After each chamber passed its bill, a conference committee yielded a compromise that easily passed, with votes of 31-9 in the Senate and 49-43 in the House of Delegates.
The bill would restrict play on the machines to people aged 21 and over, and would allow them to be placed only at locations licensed with the state Alcoholic Beverage Control (ABC) agency. It would cap at four the number of games allowed at each ABC-licensed retail establishment; 10 machines would be allowed at truck stops.
Receipts from the machines would be taxed at a 25 percent rate, higher than the original bill’s 15 percent. Prior portions that would have required local approval of the machines were removed from the final bill, meaning cities, towns and counties would be without veto power over addition of the machines.
The compromise bill passed three weeks ago, but Youngkin has yet to sign or veto the legislation.
At the rally, supporters pointed to a radio interview from 2021 Youngkin had posted on his campaign website, urging him to follow through on his prior support of skill games.
“I’m supportive of the skill games. I just think all businesses should be allowed to do business,” Youngkin said on Hampton Roads area station WNIS in 2021. “Skill games actually do enable so many small businesses to not only grow their business but also simply to survive.”
“As the debate around the regulation of skill games unfolds, I hope that Governor Youngkin stands by what he said on the campaign,” said Bhavin Patel with the Virginia Amusement Coalition, according to the Virginia Mercury. Patel said he owns “a few mom-and-pop convenience store businesses.”
“The governor is closely reviewing the legislation and budget language sent to his desk, but still has numerous issues to work through including the regulatory structure, tax rates, the number of machines, impact on the Virginia Lottery and broader public safety implications,” Youngkin spokesman Christian Martinez said in a statement.
“In 2021, when asked about this industry broadly, candidate Youngkin intimated interest in what expansion to these activities in convenience stores could potentially look like in Virginia, but now he has to look at the legislation presented to him.”
Virginians Against Neighborhood Slot Machines, a casino-funded group advocating against the skill game bill, told the Mercury that the governor should veto the bill, regardless of what he said in 2021.
“No one in 2021 could have conceived of a bill that was so lacking in public safety protections as what is on the governor’s desk,” said Nick Larson, a spokesman for the group.
