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(Photo by Michael M. Santiago\/Getty Images)<\/p>\n
A Pennsylvania House bill would outlaw dual-currency online sweepstakes games in the state, setting fines of up to $500,000 per violation and giving both the Pennsylvania Gaming Control Board and the attorney general new authority to pursue operators.<\/p>\n
House Bill 2801, sponsored by Rep. Russ Diamond, a Republican who represents the 102nd House District, was referred to the House Gaming Oversight Committee on Sept. 24, according to the bill’s page on the General Assembly website<\/a>. Its co-sponsors are Republican Reps. Jacob Banta, Brad Roae and Dan Moul and Democratic Rep. Jeanne McNeill. The bill page lists no votes or committee meetings so far.<\/p>\n The sweepstakes provision would add a new section to Title 4 of the Pennsylvania Consolidated Statutes making it unlawful for any person or entity to “operate, conduct or promote online sweepstakes games” in the state. It would also bar anyone from taking action “to support or assist in the administration, operation, conduct or promotion” of those games, language that could reach vendors and other service providers as well as operators.<\/p>\n Penalties and Enforcement<\/p>\n A violator would face a fine of not less than $50,000 and not more than $500,000 for each violation, according to the bill text. Violators would also face revocation of a gaming license and would be barred from receiving one.<\/p>\n The Gaming Control Board could conduct investigations, hold hearings and issue subpoenas and cease-and-desist orders to enforce the section. The attorney general, either independently or in cooperation with the board, could investigate alleged violations and issue subpoenas and cease-and-desist orders.<\/p>\n The bill defines an online sweepstakes game as one available online or on a mobile device that uses a dual-currency system allowing a player to exchange the currency for a prize, cash or cash equivalent, or a chance to win one, and that simulates casino-style gaming. The definition covers slots, table games including blackjack, roulette, craps and poker, and lottery-style games such as keno and bingo, as well as sports wagering.<\/p>\n The bill excludes any game that does not award cash prizes or cash equivalents. That carve-out would leave room for coin-only play at the best social casinos<\/a>, where players purchase coins to spin casino-style games but cannot redeem them. The ban instead targets the two-coin model used by many social gaming sites<\/a>, in which one coin is for entertainment play and a second can be redeemed for cash prizes.<\/p>\n The sweepstakes ban is one piece of a much larger bill. Diamond’s co-sponsorship memo, titled “Skill Games & Gaming Modernization,” describes a package that would regulate and tax skill game machines, allowing up to five in clubs, liquor-licensed bars and restaurants and qualified truck stops, with a 20% tax on gross terminal revenue. The memo also calls for cutting the tax rate on casino slot machines to 49.9% and setting a 49.9% rate for “all online casino games.” The bill’s title also lists changes to the fantasy contest and sports wagering provisions that govern Pennsylvania sports betting<\/a>.<\/p>\n Under the memo, gaming tax revenue would flow into the State Gaming Fund and be split 6.75% to the Race Horse Development Trust Fund, 1% to the Compulsive and Problem Gambling Treatment Fund, 79% to the Property Tax Relief Fund and 13.25% to the General Fund. A companion bill, HB 2802, would pay property tax relief as a direct annual gaming dividend to qualified homeowners.<\/p>\n Diamond’s memo points to the recent state Supreme Court ruling that unregulated skill games are slot machines. Following that June decision, Pennsylvania State Police are set to begin skill game seizures Oct. 14<\/a>.<\/p>\n Pennsylvania would join a growing list of states weighing the dual-currency model. Wyoming lawmakers are weighing a ban against regulation<\/a> for the products, and a Virginia bill could return in 2027<\/a> after lawmakers sent the issue to study. In states that have already acted, single-currency platforms have moved in<\/a> with one-coin models that dual-currency definitions do not describe.<\/p>\n","protected":false},"excerpt":{"rendered":"(Photo by Michael M. 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