PRINTER'S NO. 3589
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No. 2551
Session of
2024
INTRODUCED BY WAXMAN AND HILL-EVANS, SEPTEMBER 6, 2024
REFERRED TO COMMITTEE ON GAMING OVERSIGHT, SEPTEMBER 6, 2024
AN ACT
1 Amending the act of December 19, 1988 (P.L.1262, No.156),
2 entitled "An act providing for the licensing of eligible
3 organizations to conduct games of chance, for the licensing
4 of persons to distribute games of chance, for the
5 registration of manufacturers of games of chance, and for
6 suspensions and revocations of licenses and permits;
7 requiring records; providing for local referendum by
8 electorate; and prescribing penalties," providing for
9 nonbanking poker games; imposing duties on the Pennsylvania
10 Gaming Control Board and the Department of Drug and Alcohol
11 Programs; and imposing penalties.
12 The General Assembly of the Commonwealth of Pennsylvania
13 hereby enacts as follows:
14 Section 1. The act of December 19, 1988 (P.L.1262, No.156),
15 known as the Local Option Small Games of Chance Act, is amended
16 by adding a chapter to read:
17 CHAPTER 11
18 NONBANKING POKER GAMES
19 Subchapter
20 A. Preliminary Provisions
21 B. General Procedures
22 C. Authorization
23 D. Operations
 1 E. Fees and Taxes
2 F. Miscellaneous Provisions
3 SUBCHAPTER A
4 PRELIMINARY PROVISIONS
5 Sec.
6 1101. Scope of chapter.
7 1102. Definitions.
8 § 1101. Scope of chapter.
9 This chapter relates to nonbanking poker games.
10 § 1102. Definitions.
11 The following words and phrases when used in this chapter
12 shall have the meanings given to them in this section unless the
13 context clearly indicates otherwise:
14 "Associated equipment." As follows:
15 (1) Equipment or a mechanical, electromechanical or
16 electronic contrivance, component or machine used in
17 connection with nonbanking poker games.
18 (2) The term includes:
19 (i) Equipment that affects the proper reporting and
20 counting of gross nonbanking poker game revenue.
21 (ii) Computerized systems for controlling and
22 monitoring nonbanking poker games.
23 (iii) Devices for weighing or counting money.
24 (3) The term does not include count room equipment.
25 "Board." The Pennsylvania Gaming Control Board.
26 "Bureau." The Bureau of Investigations and Enforcement of
27 the board.
28 "Cash." United States currency and coin.
29 "Cash equivalent." An asset that is readily convertible to
30 cash, including any of the following:
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 1 (1) Chips or tokens.
2 (2) Travelers checks.
3 (3) Foreign currency and coin.
4 (4) Certified checks, cashier's checks and money orders.
5 (5) Personal checks or drafts.
6 (6) Any other instrument or representation of value that
7 the board deems a cash equivalent.
8 "Certificate holder." A licensed entity that holds a
9 nonbanking poker game operation certificate awarded by the board
10 in accordance with section 1122 (relating to standard for review
11 of petitions).
12 "Chip." A representation of value, including a plaque,
13 issued by a certificate holder for use in playing a nonbanking
14 poker game at the certificate holder's licensed facility and
15 redeemable with the issuing certificate holder for cash or cash
16 equivalent.
17 "Count room." A secured room at a licensed facility
18 designated for the counting, wrapping and recording of
19 nonbanking poker game receipts.
20 "Department." The Department of Revenue of the Commonwealth.
21 "Gaming area." Any portion of a licensed facility where
22 nonbanking poker games have been installed for use or play.
23 "Gross nonbanking poker game revenue." As follows:
24 (1) The total of the following:
25 (i) Cash or cash equivalents received in the playing
26 of a nonbanking poker game minus the total of the
27 following:
28 (A) Cash or cash equivalents paid to players as
29 a result of playing a nonbanking poker game.
30 (B) Cash or cash equivalents paid to purchase
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 1 annuities to fund prizes payable to players over a
2 period of time as a result of playing a nonbanking
3 poker game.
4 (C) The actual cost paid by the certificate
5 holder for any personal property distributed to a
6 player as a result of playing a nonbanking poker
7 game, but not including travel expenses, food,
8 refreshments, lodging or services.
9 (ii) Contest or tournament fees or payments,
10 including entry fees, buy-ins, re-buys and administrative
11 fees, imposed by a certificate holder to participate in a
12 nonbanking poker game contest or tournament, less cash
13 paid or actual cost paid by a certificate holder for
14 prizes awarded to the contest or tournament winners.
15 (iii) The total amount of the rake collected by a
16 certificate holder.
17 (2) The term does not include:
18 (i) Counterfeit cash or chips.
19 (ii) Coins or currency of other countries received
20 in the playing of a nonbanking poker game, except to the
21 extent that the coins or currency are readily convertible
22 to cash.
23 (iii) Cash taken in a fraudulent act perpetrated
24 against a certificate holder for which the certificate
25 holder is not reimbursed.
26 "Key employee." As follows:
27 (1) An individual who is:
28 (i) employed in a director or department head
29 capacity; and
30 (ii) empowered to make discretionary decisions that
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 1 regulate nonbanking poker game operations in a licensed
2 facility.
3 (2) Unless otherwise designated by the board, a gaming
4 employee that does not meet the criteria under paragraph (1)
5 shall be classified as a non-key employee.
6 "Licensed entity." An entity that has received a license
7 under this act.
8 "Licensed facility." The physical land-based location at
9 which a licensed entity is authorized to conduct small games of
10 chance or tavern gaming under this act.
11 "Minor." An individual under 21 years of age.
12 "Nonbanking poker game." As follows:
13 (1) A table-based poker game in which:
14 (i) a player competes against another player; and
15 (ii) the certificate holder collects a rake.
16 (2) The term does not include a table-based poker game
17 in which a player competes against the dealer.
18 "Nonbanking poker game device." Includes nonbanking poker
19 game tables, cards, dice, chips, shufflers, tiles, wheels or any
20 other device, apparatus, equipment or supplies approved by the
21 board and used to conduct a nonbanking poker game.
22 "Nonbanking poker game operation certificate." A certificate
23 awarded by the board under section 1122 that authorizes a
24 licensed entity to conduct nonbanking poker games in accordance
25 with this chapter.
26 "Player." An individual wagering cash, a cash equivalent or
27 other thing of value in the play of a nonbanking poker game,
28 including during a tournament, which may deliver or entitle the
29 individual playing the nonbanking poker game to receive cash, a
30 cash equivalent or other thing of value from another player or a
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 1 certificate holder.
2 "Principal." Any of the following:
3 (1) An officer or director of a licensed entity.
4 (2) A person that directly holds a beneficial interest
5 in or ownership of the securities of a licensed entity.
6 (3) A person that has:
7 (i) a controlling interest in a licensed entity; or
8 (ii) the ability to elect a majority of the board of
9 directors of a licensed entity or otherwise control a
10 licensed entity.
11 (4) A lender or other licensed financial institution of
12 a licensed entity, other than a bank or lending institution
13 that makes a loan or holds a mortgage or other lien acquired
14 in the ordinary course of business.
15 (5) An underwriter of a licensed entity.
16 (6) Another person or an employee of a licensed entity
17 deemed to be a principal by the board.
18 "Rake." A set fee or percentage assessed by a certificate
19 holder for providing the services of a dealer, nonbanking poker
20 game table or location, to allow the play or operation of a
21 nonbanking poker game.
22 "Security." As defined in section 102(t) of the act of
23 December 5, 1972 (P.L.1280, No.284), known as the Pennsylvania
24 Securities Act of 1972.
25 "Tournament." An organized series of contests approved by
26 the board in which an overall winner is ultimately determined.
27 "Underwriter." As defined in section 102(v) of the
28 Pennsylvania Securities Act of 1972.
29 SUBCHAPTER B
30 GENERAL PROCEDURES
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 1 Sec.
2 1111. Authorization to conduct nonbanking poker games.
3 1112. Regulatory authority.
4 1113. Local option.
5 § 1111. Authorization to conduct nonbanking poker games.
6 (a) Authorization.--
7 (1) The board may authorize a licensed entity that
8 operates in a municipality that has adopted a referendum to:
9 (i) Allow nonbanking poker games under section 1113
10 (relating to local option) to conduct nonbanking poker
11 games, including nonbanking poker game contests and
12 tournaments.
13 (ii) Operate a system of wagering associated with
14 the conduct of nonbanking poker games at the licensed
15 facility.
16 (2) Authorization under paragraph (1) shall be
17 contingent upon the licensed entity's agreement to ensure
18 that nonbanking operations will be conducted in accordance
19 with this chapter and any other conditions established by the
20 board.
21 (3) Licensed entities permitted to conduct games of
22 chance under section 301 (relating to games of chance
23 permitted) may conduct nonbanking poker games for the purpose
24 of raising money for public interest purposes.
25 (b) Number of authorized nonbanking poker game tables.--A
26 licensed entity that is authorized under this chapter may
27 operate up to five nonbanking poker game tables, with a maximum
28 of 10 players at each table, at any one time on the premises of
29 the licensed entity.
30 § 1112. Regulatory authority.
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 1 The board shall have the power and its duties shall be to:
2 (1) Establish standards and procedures for nonbanking
3 poker games and nonbanking poker game devices or associated
4 equipment. The standards and procedures shall provide for any
5 new nonbanking poker game or nonbanking poker game table and
6 any variation or composite of an approved nonbanking poker
7 game or nonbanking poker game table, if the board determines
8 that the new nonbanking poker game, nonbanking poker game
9 table or variation or composite is suitable for use after a
10 test or experimental period under the terms and conditions as
11 the board deems appropriate.
12 (2) Establish standards and rules to govern the conduct
13 of nonbanking poker games and the system of wagering
14 associated with nonbanking poker games.
15 (3) Establish the methods for the following, following
16 consultation with the department:
17 (i) Calculating gross nonbanking poker game revenue
18 and standards for the daily counting and recording of
19 cash and cash equivalents received in the conduct of
20 nonbanking poker games.
21 (ii) Ensuring that internal controls are followed,
22 including observation by employees of the board of the
23 counting and recording process described in subparagraph
24 (i), the maintenance of financial books and records and
25 the conduct of audits.
26 (4) Establish notice requirements pertaining to minimum
27 and maximum wagers on nonbanking poker games. Minimum and
28 maximum wagers may be adjusted by the certificate holder in
29 the normal course of conducting nonbanking poker games,
30 except that changes in minimum wagers at a nonbanking poker
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 1 game table shall not apply to players already engaged in
2 wagering at the nonbanking poker game table when the minimum
3 wager is changed, unless 30 minutes' notice is provided at
4 the nonbanking poker game table.
5 (5) Require each certificate holder to:
6 (i) Provide written information at each operational
7 nonbanking poker game table about nonbanking poker game
8 rules, payoffs or winning wagers and other information as
9 the board may require.
10 (ii) Provide specifications approved by the board to
11 integrate and update the licensed facility's surveillance
12 system to cover all areas where nonbanking poker games
13 are conducted. The specifications shall include
14 provisions providing the board and other persons
15 authorized by the board with onsite access to the system
16 or its signal.
17 (iii) Designate one or more locations within the
18 licensed facility to conduct nonbanking poker games.
19 (iv) Ensure that visibility in a licensed facility
20 is not obstructed in any way that could interfere with
21 the ability of the certificate holder, the board and
22 other persons authorized under this chapter or the board
23 to oversee the surveillance of the conduct of nonbanking
24 poker games.
25 (v) Integrate the licensed facility's count room for
26 nonbanking poker game operations to ensure maximum
27 security of the counting and storage of cash and cash
28 equivalents.
29 (vi) Equip each operational nonbanking poker game
30 table with a sign indicating the permissible minimum and
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 1 maximum wagers at the nonbanking poker game table.
2 (vii) Adopt policies or procedures to prohibit
3 nonbanking poker game devices or associated equipment
4 from being possessed, maintained or exhibited by a person
5 on the premises of a licensed facility, except in:
6 (A) the areas of a licensed facility where the
7 conduct of nonbanking poker games is authorized;
8 (B) a restricted area designated to be used for
9 the inspection, service, repair or storage of
10 nonbanking poker game devices or associated equipment
11 by the certificate holder; or
12 (C) an area used for employee training and
13 instruction by the certificate holder.
14 (viii) Equip all drop boxes in which cash, cash
15 equivalents, fill slips, credit slips or inventory slips
16 are deposited at the nonbanking poker game tables, and
17 all areas where drop boxes are kept while in use, with
18 two locking devices or keys, of which one locking device
19 or key shall be under the exclusive control of the board,
20 and the second locking device or key shall be under the
21 exclusive control of the certificate holder's designated
22 employees. The drop boxes shall be brought into or
23 removed from an area where nonbanking poker games are
24 conducted or locked or unlocked in accordance with
25 procedures established by the board.
26 (ix) Designate secure locations for the inspection
27 and storage of nonbanking poker game devices and
28 associated equipment as may be approved by the board.
29 (6) Establish the size and uniform color by denomination
30 of all chips used in the conduct of nonbanking poker games,
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 1 including tournaments, and a policy for the use of
2 promotional or commemorative chips used in the conduct of
3 nonbanking poker games. All types of chips shall be approved
4 by the board prior to being used for play at a nonbanking
5 poker game at a licensed facility.
6 (7) Establish the procedure to be