It’s the fastest growing revenue pool for the Georgia Lottery and brought in $141 million to Georgia education last year. It’s arguably one of the most regulated and taxed industries in the state, and it’s been plagued by bad actors and illegal practices.
- It’s the state’s “coin operated amusement machines,” or COAMs, and the Georgia legislature has been quietly working to overhaul the industry’s regulation.
Driving the news: H.B. 353, sponsored by State Rep. Alan Powell (R-Hartwell), has been in the works for years. What he calls a “cleanup for the industry” is the closest it’s come yet to becoming law in the final days of the session.
- This is the first year, Powell told a committee, “We’ve actually been able to hem up these companies and their lobbyists.”
Why it matters: The Georgia Lottery and its games like COAMs fund the state’s HOPE Scholarship and Pre-K programs. Roughly $5 billion was played on Georgia COAMs last year.
How it works: Companies that own COAMs (or “master licensees”), negotiate a contract with an “operator,” like a convenience store to guarantee space for their games, as each location can only have up to 9 Class Bs.
- By statute, each party gets 45% of the revenues and the Lottery gets 10%.
- There are more than 33,000 Class B COAMs in Georgia, according to the Lottery. Class B games are known as “games of skill” and physically resemble slot machines.
- Class A COAMs refer to lower-stakes games like coin-operated pinball, claw games and pool tables.
There are a few key problems Powell hopes to clean up:
1. Illegal cash payments. Right now, COAM winnings can only go towards in-store credit and other Lottery games. But to try to recruit players, some COAM owners and convenience stores have been illegally paying out cash instead. The bill would allow winnings in the form of gift cards, usable anywhere, which Powell argues would remove any incentive to illegally hand out cash.
- The Lottery has been…
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