Missouri Bill to Legalize Store Slot Machines Moves Forward

A bill moving forward in a Missouri House committee on Monday would give companies two years to remove unregulated convenience store slot machines. The bill, spearheaded by Rep. Bill Hardwick, a Dixon Republican, would legalize video lottery terminals, require operators to be licensed, and place the Missouri Lottery in charge of regulating the games.

Lawmakers Proposed Revised Gambling Bill

The machines found in many convenience stores and retail outlets are known as “no chance games” because they include a feature that lets players know the outcome of the next play before placing a bet. Vendors have called them “gray market” machines, arguing that this feature exempts them from Missouri’s anti-gambling laws.

However, that defense is weakening. In October, a federal jury ordered Wildwood-based Torch Electronics, which is the state’s largest vendor of these machines, to pay $500,000 to a competitor that supplies traditional arcade games, after finding that Torch had unfairly pushed them out of 20 locations.

Hardwick’s bill would subject these machines to rules similar to those governing casino slot machines and lottery retailers that sell physical tickets. Under the proposal, the games would have to pay out at least 80% of wagers as prizes, like casino slots, which are also taxed at 21% of profits. However, evidence from the federal trial showed that Torch machines returned only about 65% of wagers as prizes, with the payouts taxed as ordinary income.

If the bill passes, retailers would have one year to switch from gray market machines to devices licensed by the Missouri Lottery. Existing machines would be removed, in part because only machines linked to the lottery’s computer system for monitoring play would be legal after that deadline.

What Benefits Would the State Get If the Bill Passes?

At a public hearing on January 27, Hardwick and other supporters said the new video lottery games could generate up to $600 million annually for education. Additional revenue from higher casino boarding fees and licensing charges could bring in as much as $55 million for state veterans’ programs. If those projections hold, video lottery would become the most profitable form of gambling yet for both vendors and the state treasury.

The most recent gambling expansion in Missouri, sports wagering, was approved by voters in November 2024. In its first month of operation in December, gamblers wagered $543 million, won $437.7 million back, and the state collected $521,000 in taxes on profits. For the, gambling as a whole generated roughly $700 million for education programs for the fiscal year ending June 30, 2025. Of that, $364 million came from casino taxes and $337 million from the state lottery.

In other news about gambling in Missouri, the state will soon have a new large casino, as the Osage Nation moved forward with plans for a venue on a 28-acre site near Lake Ozark in Miller County.