As the grey market for gambling machines has grown considerably in the state of North Carolina, lawmakers in the state of North Carolina have taken steps to enact legislation that legalizes lottery terminals. The House Commerce Committee passed House Bill 954 in the past week that will allow businesses that serve beer and wine to have a maximum of 10 video lottery terminals (VLT). These terminals are allowed to mimic traditional slot machines and thus, customers will be allowed to win cash based on games of chance.

Details of the bill

House Bill 954 (HB 954) is currently with the North Carolina House Finance Committee and even as the General Assembly is to be adjourned on September 21 and the 2021 session of the state legislature is winding down, lawmakers in the House would like to be optimistic about their chances about the passage of the House Bill 954 (HB 954). Even if the House passes House Bill 954 (HB 954), the chances of House Bill 954 (HB 954) passing in the Senate this year are not very bright. North Carolina will be the eighth state after Louisiana, Illinois, Pennsylvania, Oregon, Georgia, West Virginia, and South Dakota to legalize video gaming in small businesses if House Bill 954 (HB 954) is indeed enacted.

The goal of the legislation

North Carolina has attempted to outlaw controversial gaming machines and manufacturers have frustrated these laws time and time again through adjusted gameplay that would technically not violate the law but would allow games of chance. Every time a law was passed, manufacturers would adjust the gameplay, new laws would be passed and the gameplay would be further adjusted. The statute is intended to eradicate the unlawful gaming machines that are currently operating in the state of North Carolina. If House Bill 954 (HB 954) is indeed enacted into law, a central monitoring system would be able to supervise all play through the connected video lottery terminals (VLT).

These devices would also generate revenue for the state of North Carolina. Allowing up to 10m video lottery terminals (VLT) in restaurants and bars would mean that unlicensed and unregulated terminals would be reduced or eliminated and it is estimated that there are about 90,000 unlicensed game devices in the state of North Carolina in 2021.

House Bill 954 (HB 954) mentions that the tax rate of 40% on the licensed connected video lottery terminals (VLT). House Bill 954 (HB 954) requires that 32% of the funds collected as a tax on video lottery terminals (VLT) would have to be set aside in a separate account that will be newly formed that would be named the North Carolina Video Lottery Fund while 8% that will be available to the state of North Carolina will be used towards administrative expenses that the state will incur towards regulating the video lottery terminals (VLT) and gaming.

60% of the funds realized through taxation will be shared by manufacturers, businesses, and distributors. In order to eliminate bad elements, background checks will be conducted in order to issue licenses.

Opposition to the legislation

There is substantial opposition to House Bill 954 (HB 954) with opponents claiming that instead of eradicating the illegal gaming slots and machines, the bill will legally add to the machines that are already in operation and innocent people will fall victim to the gambling machines, especially people who can’t go to Las Vegas, Nevada and will gamble away their grocery money and rent money.