Governor Abigail Spanberger of Virginia has vetoed a bill aimed at legalizing skill games, marking her second veto in two days against contentious gambling legislation. The governor, who assumed office less than three months ago, rejected both Senate Bill 661, which pertains to skill games, and Senate Bill 756, which proposed establishing a casino in Fairfax County.
In her statement, Spanberger emphasized the need for a unified regulatory body to manage all gambling activities in Virginia. She pointed out that the lack of such an authority creates significant oversight gaps, undermining the state's ability to enforce regulations consistently, combat illegal activities, and safeguard consumers. “Legalizing skill gaming and introducing more machines into our communities would only exacerbate an already fragmented system,” she stated.
Currently, Virginia permits a state lottery, sports betting, casino operations, horse racing, and historical horse racing. The state’s relationship with skill games, often referred to as gray machines, has been tumultuous. Initially allowed to generate revenue during the COVID-19 pandemic, these machines were banned in 2021. However, a court ruling temporarily halted the enforcement of this ban, leading to ongoing legal disputes until the state’s supreme court reinstated the ban in 2023.
Senate Bill 661 sought to permit the Virginia Lottery Board to authorize up to 25,000 machines statewide. According to a fiscal note released by the Department of Planning and Budget, the lottery is currently unaware of how many machines are operational, with some estimates suggesting around 90,000 machines exist.
The proposed bill included a 25% tax on gross profits, with 75% of the revenue directed to the state’s general fund, 15% to the locality hosting the machines, and the remainder for problem gambling treatment and enforcement costs. If approved, the tax from 25,000 machines was projected to yield $346.8 million annually, assuming each machine generated an average of $152 daily.
Spanberger also expressed concerns regarding the disproportionate impact of these machines, noting data from when 9,000 machines were temporarily allowed during the pandemic. The data indicated that these machines were predominantly located in economically disadvantaged communities, where a higher percentage of residents live below the poverty line and where there are significant Black and Hispanic populations. “Without a dedicated entity to assess and address the social and economic repercussions, Virginia is ill-equipped to expand gaming or legalize electronic skill gaming devices,” she concluded.