Philadelphia City Council moves ahead with prohibition of skill games

As lawmakers in Harrisburg continue to debate the future of skill games in the commonwealth, Philadelphia city officials are now taking the issue – and its impact on public safety – into their own hands. 

Philadelphia City Council’s Committee on Public Safety held a public hearing Tuesday afternoon on skill games and approved a prohibition on the gaming machines that resemble digital slot machines or gaming terminals. 

The committee passed an ordinance prohibiting skill games – which are currently unregulated by the state’s gaming law – from being operated in the city and its businesses, with the full City Council expected to consider the prohibition in the near future. The skill games, which are sometimes referred to as “gray games” by critics, are digital gaming machines that have popped up in gas stations, convenience stores, fraternal clubs and organizations, bars and taverns, as well as mini-casinos. 

In his remarks, Public Safety Committee Chair Curtis Jones said he saw 11 skill games machines at a gas station this morning – a situation he compared to an unsupervised casino. 

“I thought of Atlantic City, without a payout for the city – the thought of Atlantic City without an escort for a winner to go to their car,” Jones said Tuesday. “We need to put our arms around this.” 

Courts have ruled that the machines fall outside of the state’s gaming law because winnings are based on skill – not on chance, like traditional gambling machines. The legal rulings have allowed skill machines to pop up in various locations despite not being regulated by the state.

A group of city councilmembers, including Jones, Katherine Gilmore Richardson, Nina Ahmad, Anthony Phillips, Jeff Young, Cindy Bass, Jamie Gauthier, Mark Squilla, Jim Harrity and Rue Landau, introduced an ordinance in January to add the unregulated games to a prohibition on “certain gambling machines and skill games” within city businesses, with exception to bars and restaurants.  

The ordinance specifically makes it “unlawful for a business to operate any casino-style or skill game that accepts cash payment for the chance of a cash reward and is not otherwise regulated by the State of Pennsylvania.” Businesses such as bodegas, convenience stores and gas stations found operating such a machine would be hit with a $1,000 fine per device. An amended version of the ordinance was passed out of committee Tuesday and is expected to be read and considered by Council in the near future. 

The hearing comes amid an ongoing debate in the state capitol about how skill games should be regulated – if at all.  

Gov. Josh Shapiro’s budget proposal, which was unveiled earlier this month, factors in estimated revenue from the potential legalization of the so-called games of skill. Revenue estimates from the Shapiro administration suggest that a 42% tax on daily revenue from skill games could generate $150 million in revenue in the 2024-25 fiscal year. The estimate assumes the new framework and tax would begin on July 1, 2024.

The debate comes after 28-year-old Alexander Spencer was shot and killed by Philadelphia police officers after he was confronted while he played a skill-based game in North Philly last month. 

The legalization of skill games is an issue that has generated bipartisan support in the General Assembly, with Republican leadership hinting that there could be an appetite in the legislature for regulating the games in the future. 

The Pennsylvania District Attorneys Association recently sent a letter to Shapiro saying both the machines and some winners have been targets of theft, putting “a strain on law enforcement.”

The association asked Shapiro to help shape policy that regulates the machines and provides clear guidance to law enforcement, saying that “the legislative process should include consumer protection measures, security requirements, and mechanisms to prevent underage use.”