Ban on unregulated slot machines moves to House floor. But are the odds changing?
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Gambling invaders
Slots are illegal in Kentucky, but the makers of these machines have found a loophole and games are pouring into the state without much regulation or approval from lawmakers.
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A bill to shut down the unregulated gambling machines flooding Kentucky passed a House committee on Wednesday but may face more opposition moving forward.
House Bill 608 was part of a slate of gambling bills that were sent to the House floor, including legislation to authorize sports betting, revamp taxes on parimutuel wagering on horse races and set up a massive problem gambling assistance fund.
But lawmakers, including several who said they support expanding gambling, said they did not like game makers asking for legislative permission after the fact.
Gray slot machines, also known as skill or nudge games, began to pop up in Kentucky convenience stores, bars and restaurants about a year ago and now there are estimated to be hundreds operating without clear legislative approval.
Rep. Killian Timoney, R-Lexington, who sponsored the bill, said any expansion of gambling must be carefully considered and follow the legislative process.
“These gaming machines go into communities, show how profitable they are and then the law has to react,” Timoney said. “We have to follow the process.”
Mary Harville, president of the Kentucky Lottery Corp. said that since November the number of machines in lottery locations is up 42 percent, which is projected to cut into the revenue generated for merit and need-based college scholarships funded by the lottery.
“If you don’t take action, you give the gray machines the green light and you have to know Kentucky families and colleges will not be able to count on the same level of scholarships they have come to expect,” she said.
A last-minute substitute version of the bill failed; it would have established regulations and set tax rates for the skill games instead of banning them.
Taxing and regulating gray slots
Some lawmakers expressed support for taxing and regulating, with Kentucky Rep. Alan Gentry, D-Louisville, saying he hopes the existing ban is killed on the House floor.
Supporters of the gray machines, including a Ryan Straw, vice president of the Kentucky Fraternal Order of Police, told lawmakers the games can be a boon to small businesses and police charitable works. According to press release sent out late Tuesday, Pace-O-Matic, maker of the Burning Barrel skill games, recently gave $125,000 to the Kentucky FOP for a disaster relief trailer.
Games lobbyist Jason Underwood said taxing them could generate hundreds of millions in revenue for the state.
That clearly caught the ear of several lawmakers who suggest more discussion on the games is warranted.
Lawmakers seek more information
Gentry said that he is in support of expanded gambling but voted against both the committee substitute bill and the original bill in the hearing because of the lack of information about what the consequences could be. For instance, he said, could part of the revenue from the skill games fund scholarships?
“You’re forcing us to make a decision between expanded gaming or education. That’s not right,” he said. “I don’t really support 608 but this sub’s put me in a really tough situation. I don’t have the information to make a logical decision.”
Kentucky Rep. Kim Moser, R-Taylor Mill, who voted for the ban, said, “I hate to miss the boat on improving our revenue situation in Kentucky. I don’t like the idea of taking these away from our small businesses ... I reserve my right on the floor to change my mind.”
