Local government in Pennsylvania considering regulations for skill-based games, taking a proactive approach with regard to state guidelines.
Title: Skill Games Spark Debate in Erie, Pennsylvania: Regulation or Ban?
By: Corey Sharp, PlayPennsylvania
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Erie, Pennsylvania's North East borough is caught in a gamble — skill games.The town council gathered on Monday evening to discuss the possible regulation of these controversial machines, which some deem as mini casinos operating in small businesses. Unlike licensed gambling products, these machines don't fork over privilege taxes, a point of contention.
Skill games have popped up everywhere, according to borough president Ryan McGregor. An ordinance is under consideration, focusing on businesses with numerous skill games.
The Commonwealth Court ruled skill games legal back in December. However, their operations are more like gray matter than black and white, meaning they lack formal regulation.
(Insight: As of May 2025, skill games are legal in Pennsylvania following a Commonwealth Court ruling in December 2024, but they still operate largely in a regulatory gray area, meaning there is no statewide formal regulation or taxation on them.)
Aims for Regulation, Not a Ban
The town's administration, spearheaded by Ryan McGregor, opts for regulation rather than an outright ban on skill games. At a recent council meeting, officials delved into a proposed ordinance meant to limit the number of skill gaming machines in businesses. This move intends to ensure the games follow age restrictions and maintain proper placement within the borough.
(Insight: Notably, social clubs such as Veterans of Foreign Wars (VFW) organizations support the continued presence of skill games in their venues because they are required to return a portion of proceeds to the community. Erie officials have indicated these social clubs will continue to be allowed to operate skill games without restrictions, distinguishing them from other establishments where unregulated machines proliferate without government oversight or contributions back to the community.)
Businesses on the Fringe
Skill games now dominate venues like bars, restaurants, convenience stores, and gas stations in Erie. Although these games bolster revenue, their unregulated status means these businesses don't shell out licensing fees or privilege taxes, unlike licensed gambling operations.
(Insight: Social clubs argue that other businesses with skill games do not face the same regulations or tax obligations and therefore gain an unfair advantage. The gray-area legality allows these businesses to use skill games as a means to increase customer traffic and profits without the financial or regulatory burdens placed on traditional gambling venues or social clubs.)
Competing Against Titans
The spread of unregulated skill games has also affected bigger gambling enterprises like Presque Isle Downs & Casino, a major licensed casino in the region. The casino reports significant business slumps, with skill games drawing patrons away. The casino's management claims the unregulated machines compete unfairly and pose a threat to the casino's fiscal stability and regional economic contributions.
(Insight: Presque Isle Downs pays among the highest gaming taxes in the U.S. (around 64%) and faces competitive pressure from neighboring states with lower taxes. The unregulated skill games exacerbate this challenge by drawing customers from the casino, potentially jeopardizing its future and economic contributions to the region.)
Erie's push for skill game regulation represents a delicate balance of permitting these games' economic advantages for certain community organizations while addressing concerns about small businesses and the licensed gambling industry.
- The North East borough of Erie, Pennsylvania, is considering the regulation of skill games, which are seen as mini casinos operating in small businesses, rather than outright banning them.
- Ryan McGregor, the borough president, favors regulation that aims to limit the number of skill gaming machines in businesses and ensure they adhere to age restrictions and proper placement.
- Many businesses in Erie, such as bars, restaurants, convenience stores, and gas stations, have skill games, which generate revenue but do not pay licensing fees or privilege taxes, unlike licensed gambling operations.
- The unregulated status of skill games has begun to affect established gambling enterprises like Presque Isle Downs & Casino, as these machines draw patrons away, posing a threat to the casino's fiscal stability and regional economic contributions.
