The Kentucky Lottery Corp. says the gaming machines hurt lottery sales. In a November meeting of the interim committee on licensing and occupations, Lottery Corp. President and CEO Mary Harville told state lawmakers lottery sales are down 3% in places that have the machines, compared to being up 4% in places that don’t have machines. According to the meeting minutes, Lottery Corp. outside counsel John Goldberg called the machines “blatantly illegal.” In an interview, Harville said the county with the most machines, Laurel County, has seen lottery sales “flatline,” while lottery sales overall are up across the state. If the machines continue to expand, they will cut into lottery sales. Lottery proceeds are used for KEES scholarships for public school students and other scholarship programs. “The impact is going to be profound if that proliferation (seen in Laurel County) occurs through the entire state,” Harville said. Pennsylvania, which has a large number of gaming machines has seen a decrease in lottery revenue, Harville said. Pennsylvania “estimated they lost over $500 million over a four-year period,” Harville said.
The gaming machines in some Owensboro convenience stores are not gambling devices, an official for the company that makes them, and their legal counsel, said Monday.
While the games do allow a person to play and collect cash winnings, they do not fall under the state’s definition of “gambling,” company officials argue.
Daviess County Attorney Claud Porter said he has not entered into the matter, and is waiting for a decision in a Franklin Circuit Court case that will decide if the devices are gambling machines or not.
Wild Cat Skill games can be found in at least two Owensboro convenience stores, at the Marathon off Kentucky 54 and the Eagles’ at the corner of 18th and Triplett streets.
State law prohibits slot machines and defines gambling devices as those “based upon an element of chance.” But the law makes an exception for skill-based games.
“A contest or game in which ... the ultimate winner is determined by skill shall not be considered to be gambling,” state law says.
The Wild Cat Skill games in Owensboro convenience stores are not chance-based, said Jesal Patel, whose family owns the Eagles store on 18th Street.
“It does require a little bit of skill,” Patel said. “It’s like a tick-tac-toe style board. “The devices require people to make choices and make moves. You have to pay attention.”
According to the company’s website, the player who wins receives a receipt for a payout at the store’s register.
The Kentucky Lottery Corp. says a total of 31 outlets that sell lottery tickets in Daviess County also have the gaming machines. The county has more than 90 gaming machines, the Lottery Corp. says.
Steve O’Daniel compliance officer for Prominent Games, which makes the Wild Cat Skill machines, said state law “specifically exempts games of skill.” The Kentucky-based company has the machines in 50 counties.
“We have close to 500 terminals out there,” O’Daniel said. “When you play our game, it gives you a puzzle to solve.”
The games also include a memory portion, he said.
“It takes hand-eye coordination and memory to play our game,” O’Daniel said. “We feel confident these games to comply with the state statute.”
The Kentucky Lottery Corp. says the gaming machines hurt lottery sales. In a November meeting of the interim committee on licensing and occupations, Lottery Corp. President and CEO Mary Harville told state lawmakers lottery sales are down 3% in places that have the machines, compared to being up 4% in places that don’t have machines.
According to the meeting minutes, Lottery Corp. outside counsel John Goldberg called the machines “blatantly illegal.”
Madge Vail, vice president of compliance and regulatory affairs for the Lancaster Bingo Co., told lawmakers in November the devices are unregulated in that they are not required to be audited, according to the meeting minutes.
Bob Heleringer, attorney for Prominent Games, said the game “requires the active participation of the player.”
“It’s not a ‘put a coin in a slot, push the button and hope you win” device, Heleringer said.
“My client has come to the attention of the Kentucky Lottery Corp., that believes that we — and games like ours — are an existential crisis to them,” Heleringer said.
Heleringer called the Lottery Corporation’s concerns were “hogwash.”
In an interview Monday afternoon, Harville said the county with the most machines, Laurel County, has seen lottery sales “flatline,” while lottery sales overall are up across the state. If the machines continue to expand, they will cut into lottery sales. Lottery proceeds are used for KEES scholarships for public school students and other scholarship programs.
“The impact is going to be profound if that proliferation (seen in Laurel County) occurs through the entire state,” Harville said.
Pennsylvania, which has a large number of gaming machines has seen a decrease in lottery revenue, Harville said. Pennsylvania “estimated they lost over $500 million over a four-year period,” Harville said.
A case is pending in Franklin Circuit Court.
Heleringer said Prominent Games has asked Franklin Circuit Court to issue a ruling on the law. Arguments in the case will be heard on March 9.
Officials for Prominent Games are “very confident” the judge will rule how the games are played “is not illegal gambling,” Heleringer said.
Porter said companies that make the games have sent letters from attorneys “saying they are a skill game.”
Porter said he has seen the machines demonstrated, but that he has decided to wait to see what happens in the Franklin Circuit case.
“They wanted us to approve them before we install them (in locations),” Porter said. “I said, ‘I won’t do that.’ ”
Later, he said, “I have told them I won’t approve them, but told them I will not do anything until somebody complains.”
“They do appear to be skill-type games; they also appear to have features of gambling,” Porter said. “I am without a firm and definitive answer” as to whether the devices are legal, he said.
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