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Gov. Glenn Youngkin’s administration is tentatively backing a top Republican lawmaker’s proposal to reauthorize so-called skill machines in Virginia and use some of the money they generate to crack down on illegal gambling, according to multiple Capitol Square sources.

That stance could potentially mean another reprieve for the slots-like games the state has spent years trying to ban from convenience stores, sports bars and truck stops, only to face sustained lobbying and legal pushback from the industry and its promoters. The state is currently locked in a prolonged court battle with the industry, and officials are unable to enforce the ban on skill machines as that lawsuit proceeds. But a reversal of the state’s official position on skill games could make the lawsuit moot.

House Majority Leader Terry Kilgore, R-Scott, said he’s been told he has “possible” administration support for his proposal to let thousands of the machines continue operating and restore an old system of regulation in place before the General Assembly voted to outlaw the games in 2021. That would be a shift from the position of Youngkin’s predecessor, Democratic Gov. Ralph Northam, who allowed the machines to be briefly regulated and taxed to raise money for COVID-19 relief but ultimately followed through on banning them.

Asked if the governor is supporting the bill, Youngkin spokeswoman Macaulay Porter didn’t give a direct response.

“The governor has asked stakeholders to come to the table and work on legislation that would crack down on illegal gaming,” Porter said.

Kilgore’s proposal would essentially restore the legal status of a type of video game the General Assembly has tried repeatedly to classify as illegal gambling. But the Youngkin administration appears to view Kilgore’s bill, which has not been heard in the House of Delegates, as the only viable mechanism for raising new funds to go after illegal gambling.

Supporters of skill machines, also known as gray machines due to the legal gray area they occupy, argue they give smaller businesses a chance to profit from Virginia’s newly relaxed approach to gambling. Business owners hoping to continue hosting skill machines have characterized the push to ban them as the legislature doing the bidding of big casino interests that want to clear away competitors.

Opponents say they cannibalize revenue from more tightly regulated forms of gambling, and some legislative critics have warned against the moral hazard of granting legal status to an industry that rushed into Virginia under legally murky circumstances.

Under Kilgore’s bill, the Northam-era regulations would be reinstated until at least the summer of 2024. In that time, according to the legislation, the state would come up with new oversight rules. Just as they did under the prior regulatory system, skill-machine distributors would have to pay a flat monthly tax of $1,200 per machine. Convenience stores could have up to five machines under Kilgore’s proposal. Truck stops could have up to 10 machines.

Kilgore’s bill calls for some of the revenue generated from legalized skill machines to go toward law enforcement efforts to combat illegal gambling, an issue the state has struggled with recently after policymakers gave a greenlight to horse racing-themed slots parlors, casinos and sports betting. That money would be spread among police, local prosecutor’s offices and the Virginia attorney general’s office, all of which play a role in enforcing the state’s gambling laws.

In an interview, Kilgore indicated the specifics of his legislation are up for discussion. His goal, he said, is to allow Virginia to get some tax benefit from machines that are currently operating with no oversight whatsoever while getting tougher on illicit gambling enterprises that have thrived in the state’s atmosphere of legal and regulatory confusion.

“The main thing that I’m wanting to do is put these mini-casinos out of business,” Kilgore said, referring to pop-up businesses that offer skill machines and not much else. “There’s a lot of these game room-type deals that have sprung up all over the commonwealth.”

Skill machines — which mimic the spinning reels and tic-tac-toe patterns of slots but have a small element of skill that has allowed promoters to argue they technically aren’t a form of illegal gambling — are often placed in businesses already licensed by the Virginia Alcoholic Beverage Control Authority. The first draft of Kilgore’s bill envisions restoring ABC’s responsibility to regulate skill machines and ensure the presence of official state stickers that mark the difference between legal and illegal games.


60-90 days. Alcohol licensing in Virginia is a process that requires a 30-day objection period for retail and industry license applicants. Legal publication and a posting notice are required to put the public on notice that a license has been applied for. The 30-day objection period begins when the first of two legal publications run in the local newspaper. Any objectors must submit their objection in writing to the VA ABC Authority within 30 days of the first legal publication. Attention to detail and the accuracy of your supporting documents play a vital role in how quickly your license will be approved. Consider ABC Consulting for all of your alcohol licensing, training, and compliance needs.

Before applying for a Virginia (VA) alcohol license (ABC license), first, you should determine what license type you will qualify for. In VA, there are many different alcohol license types. Once you determine the best license type for your business, find a location to conduct your business. Upon finding a location then form a company/entity with the VA State Corporation Commission (VA SCC), after forming/registering your legal entity then apply for your Federal Employer Identification Number (FEIN) with the IRS. Upon finding a location, registering your entity, and obtaining your FEIN you may then begin the application process for a VA ABC License.

All VA ABC applications should be mailed to the VA ABC Authority in Richmond, VA for initial review. Upon Richmond review, the application is forwarded to 1 of the 9 VA ABC regional offices for a final review, site inspection, and approval.

Early 2020, Lawmakers voted to ban skill gaming machines in Virginia effective July 1, 2020. In April, 2020 Governor Northam overturned the skill gaming ban in VA under the following orders:
The Distributor of Skill Games must pay $1,200.00 per game per month in taxes to the COVID-19 Relief Fund.

Beginning July 1, 2020 and each month following until July 1, 2021 the Distributor must report to ABC Authority the total number of games, their locations, amount of money played, and amount of money paid out.

Only those skill games that were provided by a distributor and available for play in ABC retail licensees and truck stops on June 30, 2020, may continue to operate on or after July 1, 2020.
Violations of this were subject to a Civil penalty of not less than $25,000.00 and not more than $50,000.00 per incident.

As of July 1 2021, skill games machines have not been regulated and in some areas persons having machines were charged with illegal gambling devices. The 2023 VA General Assembly may decide if skill gaming will be regulated.

Skill games may be placed in any business that has an active VA alcohol license.

Games of skill require a physical or mental ability and a learned capacity to carry out a result. These games commonly include the use of strategy, tactic, physical coordination, strength, technical expertise, or knowledge.

Games of chance are games with an outcome strongly influenced by random chance or uncertainty. Common randomization devices include dice, playing cards, or numbered balls drawn from a container.

Games of chance may have some skill, and games of skill may have some chance, however, most U.S. courts use either the predominance test or the material element test to look at the role that skill and chance each take in determining the outcome of the game.

§ 18.2-325. Definitions.

"Illegal gambling" means the making, placing, or receipt of any bet or wager in the Commonwealth of money or other consideration or thing of value, made in exchange for a chance to win a prize, stake, or other consideration or thing of value, dependent upon the result of any game, contest, or any other event the outcome of which is uncertain or a matter of chance, whether such game, contest, or event occurs or is to occur inside or outside the limits of the Commonwealth.

• Elements of Gambling
• You must place a bet
• Have the Opportunity to win a prize
• Outcome is a matter of Chance.

Skilled games require the player to do something to play the game other than spin the wheel.