Jack Evans is out, but Muriel Bowser still wants D.C. to be a gambling state.
By Jeffrey Anderson
Buried in this week’s D.C. Council agenda was a December 19 request by Mayor Muriel Bowser to enact emergency gaming legislation that would pave the way for ABC licensed establishments to offer electronic “games of skill.”
The urgent request by the Mayor—which she sent down just two days after a unanimous Council vote to expel soon-to-be ex-Councilmember Jack Evans—arose from an application to the Alcoholic Beverage Regulation Administration (“ABRA”) by bro-friendly-beer-and-games impresario Geoffrey Dawson to install electronic gaming machines at Penn Social, a downtown sports bar, arcade, and event venue in Evans’s ward.
Alerted by an alert source, District Dig started asking about it on Monday.
“I only found out about it just now,” Ward 3 Member Mary Cheh told The Dig that evening, as she prepared for the Council Chairman Phil Mendelson’s Tuesday breakfast meeting in advance of the legislative session.
“I can appreciate the Mayor wanting to get up and running on a revenue-generating initiative, but what’s included here? What if we’re talking about chess, or poker, or other games that could be characterized as skill games? I don’t know enough to act with such haste.”
Though Evans—and Mendelson—drove the Council last year to approve sports betting, local and federal laws prohibit gambling tables or devices for “games of chance” that involve money or property, according to a legal opinion by the Office of the Attorney General (“OAG”).
But Bowser knows what she wants, and she wants it now.
“Unlike games of chance,” her letter to Mendelson states, “there is a growing trend in the entertainment industry called ‘games of skill.’”
Pointing to nearby jurisdictions, Bowser expressed concern that such electronic devices “will crop up around the District,” including at non-ABC-licensed establishments:
“In order to address the immediate public safety concerns that these gaming devices present, the [bill] would establish minimum age limits for players; put enforcement mechanisms in place; create consumer protection mechanisms; and ensure that the games that are installed are legally permissible games of skill as opposed to unlawful gambling devices.”
The devices have proliferated in Virginia—unregulated, Bowser says—yet the state has lost $140 million dollars to lack of regulation. “We do not want that for the District of Columbia and its residents,” she says.
What’s the rush, Evans’s colleagues wanted to know on Tuesday, just before Evans asked Mendelson to read his resignation letter after 30 years on the Council.
Committee on Business and Economic Development Chair Kenyan McDuffie, who assumes the role Evans once held, tabled the measure to allow for a more thorough public discussion.
So what constitutes a “game of skill”?
According to Bowser, some of the games look like slots, others like tic tac toe. “Although the games vary, they all have one thing in common—they require the player to employ a degree of skill in order to win.”
Penn Social’s petition for approval to install “Dragon’s Ascent” states that players pay up to $20 then attempt to “capture” the dragons by “shooting” them.
“Players can earn money based on how selectively and effectively they shoot the dragons,” Deputy Attorney General Brian K. Flowers wrote, on October 25, to ABRA Assistant General Counsel Jonathan Berman.
The game consists of fixed scenarios that can become predictable with attention and practice. A player can win back more money than he or she puts in, without random number generators or algorithms to alter the odds.
There is no element of chance, according to Penn Social and game manufacturer Pace-O-Matic.
Players of the game, which is played in two-person cabinets or eight-person tables, may cash out at any time, according to Penn Social’s application. Though players can win back more money than they put in, the house makes money based on volume of gaming action, and in food and beverage sales.
Some “games of skill” have been approved in Virginia and Pennsylvania. Dragon’s Ascent is operational in Florida, Nebraska, and Texas, and has been approved for use in Hawaii and Kansas.
In addition to Penn Social, Dawson owns Ward 2 drinking establishments such as Rocket Bar, Iron Horse Tap Room and Jackpot. His attorneys assured ABRA that it would have safeguards in place to ensure the “proper and controlled operation of the machines in the District,” including minimum age requirements, police enforcement and limitations on machines.
Though “gaming tables” are well-defined, “gaming devices” are not.
The OAG says that Congress intended to ban “contrivances” by which the public can bet on the chance of some material reward. That includes craps, dice, horse races, keno, lottery or book making.
In this sense, a machine could be considered a “gambling device” when a substantial enough element of chance is involved, regardless of the degree of skill required to win, the OAG’s memo says.
Even as other states grapple with these distinctions, there is a lack of consensus in the gaming industry as to how much effort, preparation, expertise or “skill” is required to tip the scales: One man’s Hail Mary with a Vegas bookmaker is another man’s stock and trade.
Because Dragon’s Ascent contains no element of random chance, the OAG gave ABRA the green light to approve Penn Social’s application. Having cleared that hurdle, and with the realization that she was about to lose Evans as a reliable vote, Bowser tried to slide “emergency” legislation through the Council on Tuesday.
At Mendelson’s breakfast meeting, however, as McDuffie folded under questioning by his colleagues, a photographer captured Evans glaring in frustration at his successor, his last chance to service a monied constituent evaporating before his eyes.
But if the measure seemed out of the blue, it also made perfect sense, given Evans’s final big achievement: sports betting. Dawson, who grew up in Georgetown, is poised to cash in there as well, signaling that he would pursue such licenses once it’s clear how to incorporate a sportsbook into his drinking establishments.
“I’m going to use whatever tools they give us to add something to what we offer customers,” Dawson told Bisnow.com last year. “Having two really large, sports-based bars with Penn Social and Buffalo Billiards, both are positioned to be involved.”
Buffalo Billiards has since closed, though Dawson and partner Peter Bayne still own a number of other bars under the umbrella of Tin Shop LLC, including Franklin Hall on 14th Street, and Georgetown Park’s Church Hall, which opened in 2018, after the ABC allowed a decades-long moratorium on new liquor licenses—in Evans’s neighborhood—to expire in 2016.
Though Evans was instrumental in passing the District’s sports gaming law, and was able to get Mendelson to muscle through a questionable no-bid, sole source lottery contract to include sports betting, this week’s gaming gambit was not meant to be. Not yet at least.
The next hearing on the matter is likely to take place later this month, after Evans’s last day, on January 17, in a storied career that endeared him to his many patrons.
But that doesn’t mean Bowser’s own patrons in the restaurant, bar and nightclub business won’t be urging on her games-of-skill initiative, which D.C.’s Mayor of Gambling is hot to launch as soon as possible.
