Pennsylvania skill games were classified as illegal slot machines on Oct. 14, but last week’s midterm election results could pave the way for their legal return next year.

In June, the Pennsylvania Supreme Court ruled that incorporating skill elements into a game of chance does not make it immune from the state’s Gaming Act. That decision upended operations for thousands of small businesses, bars, and fraternal clubs that relied on the controversial “gray” machines prior to the ruling.

State lawmakers scrambled to pass legislation before the court’s 120-day safe harbor period expired on Oct. 14. Political divisions in Harrisburg, however, prevented a bill regulating and taxing the terminals from reaching Gov. Josh Shapiro’s (D) desk.

Last week’s midterm elections presumably improved the odds of a legislative fix in 2027. When the Pennsylvania General Assembly convenes on Jan. 5, Democrats will hold a governing trifecta in the commonwealth for the first time since 1993.

Senate Barrier Removed

While support for skill games crosses party lines, the Republican majority in the state Senate was widely blamed for failing to coalesce around a single regulatory framework. In 2027, Democrats will hold a 26-24 majority in the Senate alongside at least 111 seats in the 203-member House.

Shapiro has repeatedly called for legalizing and taxing skill games, though his proposed 52% state cut has drawn fierce pushback. The governor’s office estimates that such a skill games tax would raise almost $766 million for the state in the first year of implementation.

Shapiro’s budgets have increased in all four years of his administration, with the $53.3 billion spending plan for the 2026-27 fiscal year representing a 5.4% year-over-year increase.

Skill game advocates are calling for what they consider a fair tax, one far below the 52% that Shapiro has proposed and most casinos pay on their slot machines. Organizations like the Pennsylvania Skill Alliance, Pennsylvania Amusement and Music Machine Association, and Pennsylvania Taverns and Players Association say a fair tax is key to allowing the machines to continue supporting small businesses, keeping workers employed, and fending off inflation.

Pennsylvania’s licensed casinos contend that unregulated skill games cannibalize their brick-and-mortar slot revenue, questioning why casinos paid millions of dollars in licensing fees while neighborhood businesses operated competing machines without similar barriers to entry.

The Pennsylvania Lottery also opposes the terminals. Meanwhile, local Gamblers Anonymous chapters have reported a surge in problem gambling linked to the machines, with a majority of new members citing skill games as a driver of their addiction or relapse.

Police Report Near-Total Compliance

On Tuesday (Nov. 10), the Pennsylvania State Police provided an update on its efforts to enforce the Pennsylvania skill game ban.

Troopers inspected 12,202 businesses known to house skill games since Oct. 14 and found that 12,134 locations had removed the machines—a 99.4% compliance rate. Authorities said they seized 14 machines and $1,913 in cash across the remaining noncompliant sites, while warning businesses not to circumvent the ban with cashless or “sweepstakes” terminals.

State police reiterated that possessing, maintaining, or operating devices that meet the legal definition of a slot machine is illegal, warning that both host businesses and distributors risk equipment forfeiture and criminal charges for unlawful gambling.