Virginia Lottery says it’s on track to lose $140 million this year to ‘skill games’

Virginia Lottery says it’s on track to lose $140 million this year to ‘skill games’
Skill games in a Richmond corner store. The games have popped up in gas stations, convenience stores and bars around the state. (Source: Ned Oliver/Virginia Mercury)

Virginia lawmakers appeared to take serious notice of the proliferation of gray market “skill games” for the first time Monday after the Virginia Lottery reported they could lose as much as $140 million this year to competition from the new devices.

The games look and function like slot machines, advertising jackpots and spitting out cash vouchers, but purport to incorporate an element of skill that manufacturers argue means they don’t run afoul of the state’s prohibition on gambling. In many cases, that skill is limited to pressing an additional button to complete a simple pattern.

“What’s alarming here, beginning in spring, is the acceleration of the deployment of these machines into the retail spaces where we conduct the overwhelming majority of our business,” Kevin Hall, the executive director of the Virginia Lottery, told members of the House of Delegates’ appropriation committee.

He said that as of August, lottery staff counted just under 4,500 of the machines at retailers that are also licensed to sell lottery products – a steep jump from just over 500 they counted at the beginning of January.

Hall said that as numbers have increased, sale of lottery products have dropped and that if the trend continues at its current rate, the lottery projects its revenues this year will drop by $140 million.

The Virginia Mercury is a nonpartisan, nonprofit news organization covering Virginia government and policy.