City Council moves to limit ‘skill games’

City Council advanced legislation Tuesday that would ban so-called ‘skill games’ from corner stores, gas stations and most other businesses.

The bill would limit the video terminals – which have proliferated in recent years – to bars with liquor licenses and at least 30 seats, along with casinos, racetracks and other regulated gambling operations.

Locations exempt from the prohibition, such as pubs and taverns, would be restricted to a maximum of five machines, said Councilmember Curtis Jones Jr., who introduced the ordinance.

Data on the number of ‘skill games’ in Philadelphia is lacking, as the devices exist in a murky and unregulated legal area; though one person who works in the industry estimated that there are more than 50,000 in the city. Jones said he stopped for gas in Wynnefield prior to the hearing and counted 11 at that station alone.

Council members expressed concerns that the games are a magnet for crime and prey on vulnerable residents. Jones mentioned the Jan. 26 shooting that left 28-year-old Alexander Spencer dead and a police officer injured inside a Fairhill beer deli with multiple gaming screens.

Police Commissioner Kevin Bethel spoke at the hearing and said the PPD supports the ban.

Business owners and game distributors – some wearing yellow buttons reading “support small businesses, support skill games” – showed up in an attempt to get legislators to reconsider the bill.

Revenue from the machines helps keep mom-and-pop stores open and people employed, they said. A 7-Eleven franchise owner from South Philadelphia said 40% of his proceeds, or nearly $100,000 a year, comes from skill games.

Lawmakers should focus on ways to help entrepreneurs and improve police response, the small business owners testified. They seemed open to regulation and a limit on the number of machines per business.

Council members stressed that they support small businesses, and, if the law passes, they want to hold an engagement period with owners before enforcement begins.

Violators would be subject to a fine of $1,000 a day for every machine, and further noncompliance could result in the city issuing a cease operations order or revoking the business’s commercial license, according to the ordinance.

Skill games have been a hot topic in Harrisburg, and Gov. Josh Shapiro, in his budget plan introduced earlier this month, proposed regulating the machines through the Pennsylvania Gaming Control Board and implementing a 42% tax on their revenue. That levy would generate $150.4 million a year for the commonwealth, his office projects.

Jones said he would welcome state action, even if it supersedes the proposed local law. However, he added that he is not willing to wait around for a divided state legislature to come to an agreement on an issue that has been brewing for years.

Skill game operators earned a legal victory in November, when the Commonwealth Court ruled that the devices are not slot machines or gambling mechanisms because they include a feature that relies on a player’s memory. The Pennsylvania Attorney General’s Office has appealed the decision to the state Supreme Court.

The legislation was voted out of Council’s Committee on Public Safety and could be brought up for a final vote as soon as next Thursday.