Philly City Council looks to ban some businesses from having casino-style skill games
Top police brass testified in support of the legislation, saying the machines are a nuisance and attract crime. But business owners testified that banning the machines would impact their livelihoods.
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Philadelphia City Council is considering banning some businesses from having casino-style gaming kiosks that have proliferated across the city and have drawn attention from lawmakers concerned that they’re unregulated and untaxed.
The legislation, which would prohibit businesses from having so-called “skill games” unless they have a casino license or a liquor license plus at least 30 seats for patrons to eat or drink, passed unanimously Tuesday through City Council’s Committee on Public Safety. It could come up for a vote before the full Council this month.
Councilmember Curtis Jones Jr., who authored the city legislation, said the idea is to crack down on the thousands of skill games that have popped up inside convenience stores and corner shops because they attract crime.
The Council action comes as Gov. Josh Shapiro is seeking to tax and regulate skill games statewide. And the issue garnered new attention in Philadelphia last month after police fatally shot a man in a Fairhill corner store who had been standing near virtual gambling machines. An officer shot Alexander Spencer after gunfire rang out, striking an officer in the leg, during a chaotic scuffle.
“We’ve been kicking the can down the road too long, and almost to a degree that these operators believe that they don’t have to answer to the city of Philadelphia,” Jones said. “Well, that ends today.”
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Top police brass and community advocates testified in support of the legislation during Tuesday’s hearing, saying the machines attract people carrying cash and encourage robberies. But business owners testified that crime existed in their neighborhoods long before the machines, which they say are key to their livelihoods.
“To outright ban them is pretty disrespectful and callous,” said Akash Patel, whose family operates a shop in Roxborough. “Why are you punishing honest, working, taxpaying constituents?”
The nearly four-hour long hearing, which featured a few tense exchanges between members and business owners, was the first in-person committee hearing that Council hosted since March 2020, when lawmakers switched to virtual meetings amid the coronavirus pandemic. In fall 2022, members returned to in-person meetings for weekly sessions but committee hearings remained online.
Skill games have become commonplace in large part because of ambiguity in state law.
The gaming terminals — while similar looking to electronic slot machines — aren’t considered slots. Pace-O-Matic, the Georgia company that manufactures most of the machines in the city, argues the games require skill and aren’t merely games of chance. In November, the Commonwealth Court sided with them in a case brought by the company.
Shapiro, a Democrat, recently proposed legalizing the machines and levying a 42% tax on daily gross revenue, which his administration estimates would generate $150.4 million annually.
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But Jones said that, while he supports a state tax, he wants fewer of the machines, period. Last year, he introduced a similar bill that would have banned the machines citywide, with the exception of in casinos, but former Mayor Jim Kenney effectively killed the legislation at the end of his term.
Because there is no state regulation of the games, officials don’t know how many are in the state, where they’re located, or how much money they generate.
And there remain open questions about how the new rule, if passed, would be enforced. Deputy Police Commissioner Francis Healy, who testified in support of the city legislation, said enforcement “will be a challenge” because police would have to witness or have video of an illegal payout taking place, not just see the machines in a store.
He said the force would work alongside the Department of Licenses and Inspections to regulate the businesses. But L&I has been plagued for several years by a mass exodus of inspectors and has, at times, struggled to effectively regulate nuisance business regulations championed by City Council.
Jones said Council will push to allocate more resources to address staffing issues in L&I over the course of budget negotiations this spring.
“We cannot pile on another added responsibility for L&I” without doing so, he said.