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Georgia's Risk-Reward Game Bill Is In Effect; Gov. Deal Signs On April 10

Posted On: 4/18/2013

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TAGS: HB 487, Steve Walton, Quarters Amusement Inc., video poker machines, Georgia video poker, Georgia Lottery Corp.,House Bill 487, amusement-only video poker, Georgia Lottery Corp., Georgia gambling prohibitions, cash payoffs, pinball, coin-op devices, redemption games, Class A amusement machines, Class B machines

ATLANTA -- In Georgia, a bill that changes the code for regulating Class B coin-operated amusement machines passed both legislative houses in March. The measure, HB 487, affects games in which players earn points or tickets that can be redeemed for merchandise on the premises, known as "adult redemption" in industry parlance.

When the bill passed the Senate on March 14, Greg Edwards, district attorney of Albany, GA, said it would make use of the Georgia Lottery's investigative arm to "track video poker activities." Throughout March, Atlanta's news media continuously described HB 487 as a video poker regulation. However, a spokesman for the Georgia Amusement and Music Operators Association has advised Vending Times that the measure, which GAMOA supports, will mostly impact adult redemption games.

"These devices are not poker machines, and have been legal and licensed for years with a $5 per play prize limit, lowest in the nation," said GAMOA's Steve Walton of Quarters Amusement Inc. (Fayetteville, GA). He added that Georgia's operators have been required to purchase master licenses and to shell out per-machine fees since the early 1990s, and that amusement games were divided into two classes some years ago.

The bill classifies skill games as Class A machines, with $25 annual per-machine license fees, and those that accumulate points as Class B, subject to $125 per-machine annual license fees. It requires all Class B games to be linked to a central state-run computer by 2023, so dollars going into them can be tracked to the penny. The law enforcement community believes this will give them the intelligence they need to identify and prosecute "bad actors" who award cash payouts. The Georgia Bureau of Investigation testified that the illegal application of these machines has created a black-market gambling industry generating more than $100 million annually. GAMOA is hoping to get all Class B games online within 24 months.

The bill's main thrust is to move oversight responsibilities of these machines from the Department of Revenue to Georgia Lottery Corp., which has a vested interest in eliminating illegal gambling because current law says the state lottery is the only gaming method that can offer cash payouts.

Walton summarized some highlights of HB 487 and the history of Georgia's two amusement machine classes:

» Georgia Lottery Corp., which is an independent corporation, not a government agency, will now regulate Classes A and B amusements.

» Operators can now use lottery products as prizes for Class B machines.

» All amusement games are still capped with the $5 wholesale prize rule (as before).

» License and permit fees for locations and operators, finalized by the Legislature last year, are unchanged.

» Class B adult redemption games will soon be connected to the lottery's central computer.

» Redemption games and merchandisers were originally Class A games, reclassified B about four years ago, then returned to Class A in 2011 thanks to GAMOA's political agility.

» A percentage of all Class B income will be directed to the lottery to fund Georgia's HOPE college scholarship program.

» Commissions paid by operators to locations and the lottery will now be definitive.

Gov. Nathan Deal signed HB 487 on April 10. Some parts of the bill went into effect on the day he signed it, Walton said. Other parts take effect at the beginning of the new licensing year, July 1, 2013.

The GAMOA was planning a meeting and seminar on April 18 in McDonough, GA, to help inform operators about the new adult redemption regulations.


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