Chavdar Vasilev is a journalist covering the casino and sports betting market sectors for CasinoBeats. He joined CasinoBeats in May 2025 and reports on industry-shaping stories across the US and beyond, including legislative debates, market...
Read Full BioTwo Pennsylvania state senators have introduced new bipartisan legislation to regulate the state’s growing “skill-game” industry. The legislation aims to generate hundreds of millions of dollars in annual revenue while cracking down on “illegal gaming and nuisance locations.”
Senate Bill 1079, introduced October 27 by Sen. Gene Yaw (R-Bradford) and Sen. Anthony H. Williams (D-Philadelphia), seeks to bring tens of thousands of currently unregulated machines under state oversight, following warnings from other senators.
“There is broad recognition of the need to regulate skill games,” Yaw said in a statement.
“This legislation delivers immediate revenue, supports small businesses and veterans’ organizations, and puts safeguards in place to protect our communities. Every concern raised by the public and by our colleagues in the legislature has been carefully considered and directly addressed in this bill. It’s time to move beyond the rhetoric and enact meaningful reform.”
A Fee-Based System
The new proposal replaces the proposed initial tax structure with a fee-based system. It would require skill-game machine operators to pay a $500 monthly fee per terminal. The senators project this system will raise roughly $300 million annually for the state.
Nearly half of that money would fund public transportation, infrastructure, and environmental programs through Pennsylvania’s Clean Streams Fund.
Unlike earlier percentage-based rate proposals that floated rates as high as 35% (excluding the Governor’s call for a 52% tax), Senate Bill 1079 opts for a predictable, flat-fee structure.
The machines will also connect to a centralized monitoring system, similar to the Pennsylvania Lottery network. This will allow regulators to track play data and collections in real time.
The bill also requires players to verify their IDs, limits the number of terminals per location, and stipulates that the games must be a secondary revenue stream for any licensed establishment.
Williams said the proposal is designed to balance fairness and accountability: “Communities across Pennsylvania have been asking us to take action on unregulated skill games and nuisance locations. This bill is about fairness, safety, and responsibility.”
Targeting ‘Stop-and-Go’ Venues
One of the bill’s provisions bans skill-game machines in so-called “stop-and-go” businesses. These establishments hold liquor licenses but primarily operate as convenience stores or delis. Lawmakers say these sites often serve as hotspots for unregulated gambling and public-safety complaints.
“Communities want relief from nuisance locations,” Williams said. “Our legislation helps law enforcement and local governments address the problem directly.”
The measure also imposes stricter penalties for unlicensed or illegal devices, giving the state more leverage against distributors and locations that refuse to comply.
A Long-Running Battle
Skill game terminals visually resemble slot machines, but they usually don’t fall under the jurisdiction of gambling regulators, as manufacturers claim they include a minimal element of player skill.
These machines have proliferated across bars, social clubs, and convenience stores in Pennsylvania. Estimates suggest tens of thousands are currently operating in the state without regulation or contributing tax revenue.
Their status has long divided the state. Casinos and the Pennsylvania Gaming Control Board argue that the machines operate as unlicensed gambling and siphon players away from regulated venues. Meanwhile, small-business owners and veterans’ clubs contend the games provide a critical lifeline, helping offset rising costs and shrinking margins.
Lawmakers have long debated whether to regulate or ban the machines. This year, three previous proposals were unsuccessful in securing revenue from skill game machines in the fiscal budget.
The new bipartisan bill aims to reconcile these interests by legalizing and licensing the machines under a new framework.
If enacted, Pennsylvania would join a small number of states, such as Nebraska, in formally regulating skill-based machines. That would make Pennsylvania the most populous state to adopt such a system — a move likely to influence lawmakers elsewhere considering similar measures.
