Court: Pennsylvania Skill Games Don’t Disqualify Businesses for VGTs

Posted on: March 27, 2025, 09:41h. 

Last updated on: March 27, 2025, 10:06h.

Devin O'Connor @CasinoorgDevinO Read More

Expertise: Asia Pacific Gaming, Commercial Gaming, Legislation, Politics.

• The Pennsylvania Supreme Court has ruled that skill games do not disqualify a business from seeking VGT licenses
• VGTs are slot-like video gaming terminals
• The PA Gaming Control Board previously denied VGT licenses for businesses that participated in skill games

The Pennsylvania Supreme Court has ruled that a business that houses so-called “skill games” isn’t disqualified from pursuing video gaming terminal (VGT) privileges from the Pennsylvania Gaming Control Board (PGCB).

The state’s highest court recently ruled that a business seeking PGCB licenses to house video gaming terminals, and individuals with an ownership interest in an entity applying for a VGT operator license, shouldn’t be disqualified for participating in the skill game industry.

The PGCB previously denied “terminal operator” and “principal” licenses for applicants seeking to place VGT machines inside qualified diesel fuel stations.

“The elephant in the room is the question of whether the operation of so-called ‘skill games’ in unlicensed premises is actually lawful under the Gaming Act and the Crimes Code,” the Pennsylvania Supreme Court’s conclusion began.

“Regardless of the legality of ‘skill games’ as they have proliferated in Pennsylvania, the industry that has sprung up around them involves thousands of Pennsylvanians who are under the impression that they are operating fully within the bounds of the law. They have been led to believe this through court rulings and through the representations of the device manufacturers and their lawyers. Given this landscape, it is reasonable for these individuals to believe that they are doing nothing wrong,” the opinion continued.

VGT Qualifying Conditions

In 2017, Pennsylvania lawmakers and then-Gov. Tom Wolf (D) greatly expanded gaming in the commonwealth by authorizing Category 4 mini-casinos, sports betting, iGaming, fantasy sports, and VGTs inside diesel truck stops meeting certain criteria. For truck stops to qualify for VGT rights, the law said applicants must demonstrate that they possess “good character, honesty, and integrity.”

In the PGCB’s review of VGT licensing applications, the Board ruled against certain bids on the basis that the businesses participated in skill games, the gray slot-like machines that the gaming regulatory agency has deemed to be illegal casino gambling products. The state Supreme Court ruled with several appellants who alleged that they were wrongly denied VGT licenses for housing what they believed to be legal skill gaming machines.

‘Skill games’ now appear on the premises of many honest business owners, who surely would not operate them if they knew them to be illegal. It is, thus, excessive and unfair for the Board to declare that every individual involved in this industry lacks ‘good character, honesty, and integrity’ merely due to their involvement in the industry,” the opinion explained. “Absent any other evidence to support that determination with regard to a specific applicant, an adjudication of this sort is arbitrary, capricious, and an abuse of discretion, and accordingly must be reversed.”

Gov. Josh Shapiro (D) continues to call on the General Assembly to pass legislation to create a legal, regulatory framework for skill games. The state’s legal, highly regulated, and taxed gaming industry, however, continues to lobby lawmakers against such legislation on the belief that skill games are cleverly designed to circumvent the state’s gaming laws and that the machines poach into their slot play.

Diesel Requirement

Pennsylvania’s Gaming Act was amended in 2017 to allow gas stations that sell at least 50K gallons of diesel fuel each month to seek VGT licenses for up to five of the slot-like gaming machines. Gross revenue from the machines is subject to a state tax of 52%.

VGTs generated gross gaming revenue of more than $41.5 million in 2024.