The average Michigander may not even notice the pseudo-slot machines at the gas stations, markets, and bars they visit. Skill games, or unregulated gambling machines, probably won’t be at the forefront of their minds when they enter voting booths on Nov. 8. However, maybe they should be.
Because when members of the House return to the Michigan Legislature after Election Day, they will be considering the proposed skill games legislation that the Senate approved on Sept. 28. If Representatives pass SB 1065, the bill will move on for Gov. Gretchen Whitmer to sign into law.
Bill language says it revises “redemption games” law.
The Michigan Gaming Control Board (MGCB) and gambling industry leaders say SB 1065 proposes letting criminals get away with more illegal activity.
MGCB Communications Specialist Mary Kay Bean told MichiganSharp.com yesterday:
The Michigan Gaming Control Board opposes SB 1065 because, essentially, it will allow the creation of unregulated mini-casinos in Michigan.
Bill sponsors, Sen. Dan Lauwers, R-Brockway, and Sen. Jim Ananich, D-Flint, didn’t return MichiganSharp.com‘s requests for comment.
Lauwers is running for reelection against Democrat Bert Van Dyke. Ananich, the Senate minority leader, is leaving office due to term limits.
Gambling Industry Leaders Want Skill Games Regulated
Gambling industry leaders are plainer about their skill games opposition.
Children are playing the games (excluding those found in bars), according to Penn Entertainment President and CEO Jay Snowden. And regardless of where the machines are located, individuals who’ve excluded themselves from legal retail or online casinos can still use the machines. Snowden made these comments on Sept. 22 at the East Coast Gaming Congress and NexGen Gaming Forum (ECGC) in Atlantic City.
David Cordish, chairman of the real estate and retail casino organization Cordish Companies, agreed that there’s no process to stop minors from playing skill games. He added during ECGC that the American Gaming Association (AGA) was right to ask the US Department of Justice (DOJ) to crack down on skill games across the country.
In Pennsylvania, Greenwood Gaming and Entertainment is suing Pace O-Matic (POM). Greenwood owns Parx Casino and BetParx, and powers PlayGunLake in Michigan.
Returning to the proposed Michigan legislation that would expand rights for the skill games gray market, Bean tells MichiganSharp.com:
The bill would impede our ability to take action against unlicensed operators offering unregulated gambling machines in Michigan.
MGCB Opposes the Skill Games Expansion Bill
Just after Lauwers and Ananich introduced the skill games expansion bill in May, Jasmine Tompkins testified before the Michigan Senate Regulatory Reform Committee that first considered the proposed legislation.
Tompkins, an MGCB legislative liaison and external affairs manager, testified:
This bill … goes further than clarifying what is legal and instead expands the limited exception of redemption gaming to include a definition of “redemption game machine”; thereby, authorizing many types of gambling machines that are currently used for illegal gambling and allow unregulated “mini- casinos.”
We see this bill as an attempt to combat the efforts of the Michigan Gaming Control Board, Michigan State Police, and the Attorney General’s Office to stop illegal gambling throughout the State and instead create an expansion of gaming, which will be unregulated and untaxed.
Senators who heard her testimony approved the bill on Sept. 28. Coincidentally, that’s when members of the MGCB and the Michigan Department of Attorney General raided several gas stations and a storefront. They seized 56 allegedly illegal gaming machines using the existing law.
Tompkins Describes the Expanded Skill Games Bill
Skee-ball is a classic redemption game. So is one involving throwing balls into hoops. Those are not slots-style games, testified Tompkins.
She told Senators about the current law:
Regarding currently allowed redemption and crane games,
• The machine must have an outcome of the game be determined through an element of skill
• The prize awarded must be based on a player achieving the object of the game
• Only non-cash prizes can be awarded
• The wholesale value of the non-cash prize is $3.75, and
• The redemption value of coupons or other representations of value awarded does not exceed 15 times the amount charged for a single play of that game.
• A gift card may be awarded if it is useable only at that retailer or their affiliates, the gift card is issued in a specified amount and cannot be altered with a pin, and is redeemable only for goods and services; not cash.
What Would SB 1065 Accomplish?
SB 1065 “expands the allowable prizes,” according to Tompkins, and changes the definition of a redemption game “from an element of skill to any combination of skill and chance.”
It is important to note that the machines themselves are not illegal; rather, it is the manner in which these machines are often used that makes them illegal. The manner in which they are used often does not comply with the guidelines I mentioned earlier in my testimony and are effectively replicating casino-style games. In fact, many players that play these types of machines don’t know the difference between these machines and slot machines found in a casino.
SB 1065 would change the wholesale value of a non-cash prize to a maximum of $500. The proposed law would also allow for prizes like Visa gift cards. These could be redeemed anywhere, unlike retailer gift cards that would only be usable on the premises (or at other participating locations, in the case of a chain). The cards could also be used for food and drink, which isn’t allowed under the existing laws.
This bill calls for an expansion of gaming with no regulatory framework and no regulatory body assigned to ensure the integrity of such activities. There are no protections in place for individuals with gambling problems, there is no recourse for player disputes, and there are no requirements for surveillance, security, or internal controls.
In short, SB 1065 foreshadows “a much greater risk of illegal activity.”
Perhaps Michigan voters will take a gander at those skill games before voting.