Slot machine revenue, or win, in Nevada declined 5 percent in the past 10 years, from $7.09 billion in 2004 to $6.74 billion in 2014. Nevada slot machine revenue hit an all-time high of $8.4.
Skill-based gaming is nothing new. It debuted in Atlantic City and Las Vegas around five years ago to mixed success.
However, skill slots are currently the hottest thing in Pennsylvania’s gaming market. Numerous people are playing these slots at bars, convenience stores, restaurants, and other types of businesses.
A PA skill game works a little differently from a regular slot machine. Assuming you’d like to know more about these games, you can learn about them below.
How Does a Pennsylvania Skill Slot Machine Work?
A Pennsylvania skill game looks and plays very similar to a regular slot machine. You begin playing these games by inserting your money into the terminal.
Next, you spin the reels and hope to line up matching symbols in paylines. Most of these games show how much each winning combinations pays through a pay table on the side.
Again, you can see that these games aren’t much different from standard slots. But each can differ from the next regarding the skill element.
Here are various examples on how these slots incorporate skill:
- A pre-reveal mechanism that allows you to see if you’ll win or lose the next spin.
- You must touch wild and/or scatter symbols to activate them.
- Skill-based bonus rounds.
Starting with the first option, pre-reveal slot machines first gained infamy in Florida. They give you an option, or force you, to see if the upcoming round will be a winner or loser.
Knowing the result of the spin enables you to determine whether it’s worth playing. Normally, though, you can only see the result of a single spin.
The second feature, where you touch certain symbols to activate them, doesn’t really bring much skill into the fold. It simply introduces a manual element to the game.
Finally, skill-based bonus rounds can see you do all sorts of things. One example is a memory game, where the slot shows you a series of flashing dots.
At first, you’ll have an easier time remember which dots flash. But these games get tougher and tougher as more dots flash and really test your memory skills.
How Do Skill Games Differ From Regular Slot Machines?
A skill slot machine looks and plays much like standard real money slots. You probably wouldn’t be able to tell the difference between the two under most circumstances.
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However, PA skill games feature more action than just spinning the reels. As described before, they see you doing everything from tapping symbols to playing fun bonuses.
Pace-O-Matic, one of the biggest manufacturers of such terminals, designs these games in a specific manner so as to avoid the normal gambling distinction.
After all, convenience stores, laundry mats, and bars can’t just offer a regular slot machine without a license. But they can feature a skill-based terminal without breaking laws—at least for now anyways.
These machines also give you more influence over the results. You might not be able to use your abilities to control 100% of the outcomes. However, you may have the ability to control approximately 3% of the action through skill.
The companies that develop PA skill slots aren’t required to divulge return to player (RTP). Their operators don’t need to offer this information either.
This aspect heavily differs from the regulated Pennsylvania gambling market. Land-based casinos must work with gaming regulators and offer RTP figures.
In What Ways Are Skill and Regular Slots the Same?
These games may offer the promise of skill-based gaming. In the end, though, they aren’t much different than standard slot machines.
Both use random number generators to determine the bulk of the results. Your odds of winning heavily rely on the luck associated with each spin.
For example, a PA skill slot might feature 90% RTP on the spins alone. But it would give you the ability to influence another 5% of the RTP through a bonus round.
With expert play, you could bump the payback up to 95%. Of course, this figure doesn’t differ much from casino slots, which typically offer between 90% and 95% payback.
Another similarity is the fact that the house wins in both cases. Some players mistakenly believe that they can win guaranteed profits if they play a skill-based game just right.
The truth, though, is that they don’t have any better chance of winning at a convenience store than they do a casino. The skill aspect is mostly an illusion that’s designed to float Pennsylvania gambling laws.
Of course, you can always get lucky with a skill-based or regular slot machine and win the jackpot. You’ll be relying on luck to win in both cases, though.
Skill Slots Are Quite Controversial
PAIG also takes exception to the fact that these games aren’t regulated. The Pennsylvania Gaming Control Board doesn’t have any jurisdiction over the makers or operators of skill terminals.
Furthermore, the bars, convenience stores, and restaurants that offer these machines don’t pay additional taxes. They only cover standard income taxes on profits.
Contrast this situation to the state’s 12 land-based casinos. Each must pay a licensing fee to operate along with a 54% tax rate on revenue.
This 54% rate makes Pennsylvania one of the toughest markets for earning casino gaming profits. Meanwhile, skill-based operators gain a competitive advantage by paying far less in taxes.
Will Pennsylvania Ban These Slot Machines?
PAIG has made some headway in bringing light to the hypocrisy surrounding skill-based gaming. The group is drawing more attention to their mission of getting these games shut down.
Police in certain Pennsylvania jurisdictions have seized these terminals during crackdowns on illegal gambling. Pace-O-Matic responded with a lawsuit against the Bureau of Liquor Control and Enforcement.
As of now, the two sides are embroiled in a murky legal battle where nobody has tasted victory yet. In January 2020, a Commonwealth Court judge ruled that Pennsylvania State Police can seize skill-based games while the matter is being decided in court.
This ruling doesn’t mean that authorities will seize relevant terminals all over the Keystone State. Instead, it just lifts a ban on the practice of doing so as law enforcement sees fit.
State police argue that the skill-based machines are only a small part of their crackdown on illegal gambling. They’ve only seized a few dozen of the 20,000 skill games operating throughout the state.
For this reason, the Commonwealth Judge saw no reason to ban such seizures. Of course, the games will be given back if Pace-O-Matic wins its case.
Neither side has presented a compelling argument on why these terminals should or shouldn’t be legal. But Florida might provide a preview on what will happen with this case.
The Sunshine State had a problem with pre-reveal slot machines running rampant throughout its borders. The Seminole Tribe, which holds a gambling pact with Florida, argued that pre-reveal games violated its agreement with the state.
After careful consideration, a judge decided to ban these machines. They ruled that pre-reveal slots fall under the definition of illegal gambling.
Pennsylvania doesn’t have a tribal gaming pact with any Native American tribes. However, it does have a licensed gambling market with 12 casinos.
The state may ultimately rule against Pace-O-Matic to preserve its good relationship with the licensed gambling establishments.
Conclusion
A PA skill slot differs slightly from casino terminals by including some element of skill. “Some” is the key word here, though, because these games don’t give you a true chance to overcome the house edge.
You might be able to influence 5% of the RTP through your abilities. But if the base RTP is 91%, you can only achieve up to 96% RTP.
Skill-based slots remain a mixed bag. They include different elements than a standard slot, but they’re also somewhat deceiving in how much control they give you over results.
PAIG is currently fighting against these terminals and believe that they constitute illegal gaming. The jury is out, though, on if these games will ultimately be outlawed.
The legal battle over whether or not “Pennsylvania Skill Games” are slot machines based on random chance – or skill games where decisions and knowledge influence the outcome – remains undecided for now.
A judge said Wednesday she will soon rule on a standing injunction preventing the PA State Police from seizing games distributed by Pace-O-Matic. California grand casino casinos slot machines. While law enforcement authorities believe the machines to be illegal, the larger question of the legality and regulation of all skill games will remain unsettled for the near future.
A statement from Gov. Tom Wolf’s office made it clear where the fight will head after the injunction battle is decided.
Wolf said:
“The administration believes Pennsylvania must take a hardline on illegal gambling, including so-called ‘games of skill’ and other slot machines. These machines are illegal, unregulated and put senior programs at risk by siphoning revenue from the Lottery.”
Setting the pace – skill games proliferating
There are 24,000 slot machines in Pennsylvania’s highly regulated and heavily taxed casinos.
But there is an untold number – likely more than 15,000, and perhaps as many as 20,000 – unregulated devices labeled “skill games” in gas stations, convenience stores, fraternal organizations, pizza shops, and even strip mall arcades.
The injunction court battle pertains only to a game made by Pace-o-Matic.
Pace-O-Matic accounts for about half of the skill games, or about 10,000 of the devices in PA. The software is made in Georgia and machines are assembled in PA by Miele Manufacturing. There are also perhaps four or five rival distributors of what are also labeled skill games in PA, according to PA State Police.
Contradictory previous court rulings on skill games
Two court rulings have previously considered the legality of the machines. One in 2014 ruled Pace-O-Matic are skill games.
A ruling on skill games last November found the devices were not skill games, but rather slots.
The PA State Police, the Attorney General and a coalition of casinos and racinos organized as Pennsylvanians Against Illegal Gambling contend they are games of chance, not skill, and troopers began seizing machines following the November court ruling.
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The Office of the Attorney General provided the following comment to PlayPennsylvania:
“We maintain that POM is engaged in illegal activity under the Pennsylvania Crimes Code and the Gaming Act and we are committed to supporting law enforcement in its efforts to protect Pennsylvanians from the harms associated with illegal gambling.”
The anti-skills game coalition has hired Peter J. Shelly, a prominent Harrisburg public affair specialist, to beat the drum against skill games.
He recently wrote a long op-ed piece that ran on LancasterOnline, where he said:
“Illegal slot machines victimize young people and their families. They are easily accessible to young people. The Pennsylvania State Police has called their operation ‘ripe for corruption.’ These machines have pulled close to $200 million from the Pennsylvania Lottery, which funds senior centers, low-cost prescription drugs for seniors, and programs that allow seniors to stay in their homes.”
Injunction against enforcement at the heart of the hearing
After troopers seized some of Miele’s games late last year, his company had an injunction brought against further police enforcement on December 13.
The impact of those conflicting court rulings, as well as the injunction, created a quagmire of unanswered questions, such as:
- Are the skills games simply unregulated gambling devices?
- Or does their supposed skill component put them outside regulation under current PA laws?
- Should skill games be readily accessible to those who are at least 18-years-old – and sometimes younger?
- Or should the games be restricted only to those 21-years-old and up, as is the case with casino slots?
- Is it fair skill games are untaxed, or should they be taxed? Casino slots pay 34%.
Pa Skill Machines Are Slot Machines Says Judges Against
The hearing Wednesday only considered the injunction.
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Pace-o-matic attempts to set itself apart
Adding to the stickiness, Pace-O-Matic skills games distributor Miele Manufacturing has filed a civil suit against a rival company claiming 3C Amusements’ machines areillegal gambling devices with no skill involved.
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Company owner Louis Miele recently told Scranton-area TV station WNEP TV that rival machines distributed by other companies and sold as skill games actually do have predetermined outcomes and are thus illegal.
“A slot machine is a game of chance and the player of a slot machine has no determination on the outcome, unlike our machine which is a predominant game of skill and there is not an outcome unless the player interacts with our machine causing the outcome.”
A spokesman for Miele’s company told the Reading Eagle newspaper recently that state regulation and taxation are welcome.
Opposition, skill games debate far from over
Further court and legislative considerations are inevitable. There have been pushes to outlaw the games with a number of competing bills kicking around in the Legislature.
And meanwhile, Miele Manufacturing has hired prominent lobbyists and lawyers and given more than $270,000 in campaign donations according to the Associated Press.
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After the inconclusive hearing Wednesday, the State Police said while they are complying with the injunction, they continue to investigate.
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“Investigations into illegal gambling activities in the commonwealth are ongoing during this time. The department continues to pursue all legal avenues to combat illegal gambling in Pennsylvania. These illegal devices are siphoning off funding for programs that hundreds of thousands of seniors rely on. The Pennsylvania Lottery estimates the devices have resulted in the loss of more than $200 million in sales.”
This article was updated on Jan. 17 with a quote from the Office of the Attorney General.