A proposed Pennsylvania bill would legalize operator-based video gaming terminals in fraternal clubs, such as those associated with volunteer fire departments and veterans service organizations.
Proponents of Pennsylvania House Bill 2478 say legalizing these terminals — which allow gamblers to bet on the outcome of a video game — would boost revenue for these clubs, some of which are struggling financially.
Twenty years ago, for example, Pennsylvania had about 750 Veterans of Foreign Wars posts, but 300 have since closed largely due to financial constraints, according to a to a Monday news release from government relations firm Milliron & Goodman. Legalizing video gaming terminals, the release said, would help struggling clubs increase revenue, thereby helping improve their facilities and grow membership.
“From a financial standpoint, clubs in general need just about every bit of revenue they can generate,” said Commander Ronald Rapee of VFW Post 13 in Allentown. “In our case, most of what we get is from the dues paid.”
Rapee said though he thinks the bill is generally good, he isn’t sure his post would purchase a video gaming terminal, given its small and aging membership. Still, he said if the bill were passed, it’s something he and his post would consider.
Chuck Jackson, quartermaster of VFW 9264 Macungie Memorial Post, said he disagreed with the bill because he thinks it puts seniors at a disadvantage.
“We tend to think that people get addicted to playing video machines like that,” Jackson said. “When somebody that’s a senior citizen starts playing those games instead of paying for their house or things like that, it’s a bad thing.”
He added that posts looking to raise funds can turn to different revenue streams, like small games of chance licenses, which allow games like raffles and 50/50 drawings but not poker. Though he said his VFW post doesn’t currently have this type of license, it’s always an option if the post needs to generate more funds.
And though many social clubs across the state are already using these video gaming terminals illegally, neither Rapee nor Jackson said they knew of any VFW posts in the area who had them.
Proponents cite the success of a similar law in Illinois. With its operator-based model, which was implemented statewide in 2012, Illinois generated over $123 million in 2016 and 2017, according to the release. The state currently has about 460 clubs generating about $22 million from January through April, with each club having a monthly revenue between $3,000 to $5,000 per month.
In Illinois, those clubs receive 35 percent of the total revenue, whereas 25 percent goes to the state, 5 percent to the municipality and 35 percent to the licensed terminal operator.
And whereas only counties with casinos contained in their borders receive local tax revenue, VGTs could theoretically open across the state’s 67 counties.
State Sen. Tommy Tomlinson (R-Bucks), however, called VGTs last year a “bad bet” for Pennsylvania. Among his concerns is a potential increase to the rate of gambling and underage gambling, as well as decreases to some state funds.
Implementing the terminals, he said, would hurt the State Gaming Fund, which is used to offset property taxes, as well as the State Lottery Fund, which powers various benefit programs.
“The VGT proposal is nothing more than a back-door property tax increase taking money out of your pocket and putting it into the pockets of large Nevada- and Illinois-based VGT operators,” Tomlinson said last year.
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