Virginia Lawmakers Hoping for Decision Regarding Skill Games in 2022

The US Gambling industry reached new heights in 2021, breaking the record for highest annual revenue in just 10 months. A big part of the recent success has been due to an increase in sports betting. Many states jumped at the chance to legalize sports betting after the US Supreme Court overturned PASPA in 2018. As a result, several states also took this an opportunity to reevaluate their gambling laws in general.

Not every state has been as keen to allow widespread gambling. Virginia, for instance, is still working to get the state’s first casinos up and running. During the pandemic, the commonwealth only temporarily allowed skill gaming terminals throughout the state. The skill gaming terminals were originally legalized with hopes of providing a new source of income during the pandemic.

Virginia earned money from the fees on the gaming terminals. In total, the state raked in $130 million from legal terminals. The order legalizing the skill gaming terminals expired on July 1st. Since the order expired, the terminals were technically banned again.The legality of the ban on the terminals has been called into question. A county judge in Virginia granted a temporary injunction against the ban. As a result, the skill gaming terminals are legal, for now.

There is also no regulatory body overseeing the terminals. When the ban was temporarily lifted, Virginia’s Department of Alcohol and Beverage Control (ABC) was in charge of the terminals. However, the terminals were removed from ABC oversight when the ban was put back in place at the beginning of July.

The Argument for Legalizing Skill Games

Those opposing the ban on skill-based gaming machines are claiming the state does not have the right to issue the ban in the first place. Former NASCAR driver Hermie Sadler owns several Sadler Brothers Oil stores throughout the state. Sadler opposed the ban on the grounds that it violates the first amendment. Earlier this month, A Greensville County judge ruled in Sadler’s favor.

Sadler and other opponents of the ban argue that the terminals are similar to arcade games. The terminals require that players physically interact with them and have a skill component. Players have the ability to influence the outcome based on their skill level. According to Sadler and his supporters, that qualifies the entertainment machines for first amendment protection.

The machines themselves are good sources of income for both the state and the stores that offer them. Sadler has rallied support among the other small business owners that want to continue to use the machines. At a hearing in September, over 50 small business and convenience store owners were present to support Sadler.

Virginians’ fight to reinstate skill games has been ongoing for years. Prior to 2020, similar skill games had been allowed in the commonwealth. However, lawmakers banned the machines to make way for new casinos to be built in Virginia. Banning the machines eliminated competition for the new businesses. Many of Sadler’s supports had been using the previously legal machines for years. In some cases, small business owners had been using the machines for decades.

Why Some Virginia Lawmakers Oppose Legalized Skill Games

Sadler and other proponents of the gaming machines have the support of many small businesses throughout the commonwealth. However, that may not be enough. Those opposing the skill gaming machines are the ones making the laws in the commonwealth. State attorneys are appealing to Virginia’s supreme court to overturn the injunction.

Representatives of the state have pushed backed against Sadler’s argument regarding citizens’ first amendment rights. The defense argues that the skill gaming machines are illegal on the grounds that they offer cash prizes. They also argue that the small businesses that operate the machines are concerned with their profits, not their civil liberties. Ironically enough, profit could be one of the major reasons Virginia lawmakers keep fighting to put the ban back in place.

The initial ban on the machines in 2020 coincided with the construction of four brick-and-mortar casinos in Virginia. When the ban was temporarily lifted for pandemic relief, the commonwealth received income in the form of fees. There are no such fees in place under the current injunction. The machines themselves would also offer more competition for the casinos if they were allowed to continue to operate.

Another issue facing Sadler and his supporters is that the ban on gaming machines was passed with bipartisan support in both houses. It is, unfortunately, a rare sight to see Democrats and Republicans work toward a common goal these days. Their mutual opposition to skill gaming machines could spell trouble for Sadler.

The current injunction is in place until May 2022, but the issue could be resolved before then. Virginia’s General Assembly meets in January and legislators are pushing to resolve the issue then.

Conclusion

Small businesses in Virginia earned a major, if temporary, win this month. Greensville County Judge Louis Lerner ruled earlier this month that the commonwealth’s ban on skill gaming machines was unconstitutional. As a result, businesses are allowed to operate the machines for the time being.

Skill-based gaming machines were legal in Virginia until 2020 when the legislature banned them. The ban was temporarily lifted as part of COVID-19 pandemic relief measures. Despite earning $130 million from the fees imposed on the machines, lawmakers allowed the ban to be reinstated on July 1st.

Proponents of the gaming machines have argued that the state’s ban is a violation of the US constitution. According to those opposing the ban, the machines are similar to arcade games and should be treated as such. Many small businesses throughout the state had been using the gaming machines for decades prior to the ban.

Lawmakers that oppose the skill gaming machines see things a little differently. They are arguing that businesses are more concerned with the profits they earn from the machines, not their civil rights.

The injunction is in place until spring of 2022, but it could be addressed long before then. Lawmakers meet again in January and the status of the gaming machines will likely be on the agenda.