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Gaming And Gray Update: VLTs, Sweepstakes Video, Electronic Pull-Tabs, More

Posted On: 1/31/2013

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TAGS: video gaming machines, video poker machines, video lottery terminals, Illinois VLTs, Minnesota electronic pull-tabs, table gaming devices, sweepstakes video games, Internet cafe, eight-liners, legal gaming machines, location-based gambling, gambling law loopholes, coin machine operators, Horseshoe Casino

Favorable conditions for video poker are up in Illinois and Delaware, while the legal environments for sweepstakes videogames and eight-liners are mostly down in South Carolina and Texas. In Minnesota, operators may have reason to applaud the weak performance of electronic pull-tabs. Here is a state-by-state overview of some of the latest developments.

Illinois: Now that operator-run video poker has proved a success, the city council in Elgin has decided it wants to legalize the activity ... after voting against it in July 2012. The council held a hearing on Jan. 23 where local businesses and private clubs pleaded for legalization to make their businesses competitive with those in surrounding towns where VLTs are available. Supporters said the city's cut from VLT profits could hit $644,000 a year if all liquor-licensed locations install five machines, reported the Daily Herald.

Delaware: The state's House of Representatives voted 34-1 on Jan. 25 to permit fraternal organizations and veterans groups to continue operating slot machines on their premises until June 30. The Senate is expected to pass the bill, which has the governor's support. Lawmakers said they plan to create a permanent legal framework for these locations to operate gambling devices long-term, said local news outlets.

South Carolina: On Jan. 15 the Senate voted 40-2 in favor of a bill designed to shut down sweepstakes videogames statewide. Sweepstakes are allowed in retail locations like McDonald's and in venues with beer and wine permits. However, that provision was not intended to apply to networked videogames, said supporters of the measure, which would close this so-called loophole in the current law.

Texas: Sharply different policies on eight-liners have been adopted in the cities of Houston, Madisonville and San Diego. The Houston Northwest Chamber of Commerce met with local law enforcement to advise officers that city leaders hope to create legislation that will restrict eight-liner operations in their jurisdiction. The Chamber said it supports classifying and zoning private rooms for eight-liner establishments the same way that recent county legislation zones strip clubs and other adult-oriented businesses, said the Houston Chronicle. Meanwhile in the city of Madisonville, police raided a convenience store on Jan. 18, seizing 14 eight-liners and $53,000 in cash. Police arrested six individuals and charged 31 with gambling-related felonies and misdemeanors, said the Madison Meteor. On the opposite end of the spectrum, the San Diego City Council voted Jan. 23 to allow eight-liner gaming in their city, even though the Duval County Sheriff announced back in September that he was cracking down on the gamerooms. The mayor said he supports the policy but the county sheriff said he would continue to enforce antigambling laws against violators, according to KIII radio.

Ohio: Attorneys for sweepstakes videogame operators said they have evidence that the Horseshoe Casino in Cleveland is working with an assistant county prosecutor and a state investigator to suppress the electronics sweepstakes sector. Testimony and email documents link the casino to the bringing of criminal charges against a sweepstakes game supplier, the attorneys told the Cleveland Plain Dealer.

Minnesota: Electronic pull-tabs on tablet computers were legalized for liquor-licensed locations and began rolling out in September 2012, but revenues to date have been far below initial projections. That may be good news for amusement operators, since charities, nontraditional amusement vendors, are the official operators of electronic pull-tabs under the law. Lawmakers had hoped 2,500 locations would be using the devices by now and that they would generate $17.2 million in gross revenues by the end of July 2013. Instead, according to the Minnesota Gambling Control Board, only 120 restaurants and bars offer the video pull-tab tablet games so far; gross sales through December stood at $4.2 million, said the Minneapolis Star-Tribune.