When it comes to the variety of fees associated with obtaining and holding a Location License to operate Class A and/or Class B Coin-Operated Amusement Machines (COAMs) in Georgia, we know that it may be overwhelming and confusing. This blog will help you understand some of the fees associated with this process to help you get a better understanding of what it all entails.
If you are a location owner interested in running and operating Class A and/or Class B COAMs at your establishment, you must first start by obtaining your Location License. If you would only like to add Class A COAMs to your establishment, then you will only need to apply for your Class A Location License. If you only wish to operate Class B COAMs, you are only required to obtain a Class B Location License. If, however you are wanting to operate and run both Class A and Class B machines you will need to get your Class B Location License in order to do so. What constitutes a Class A or Class B machine?
Class A COAM Machine by definition is a bona fide coin operated amusement machine that does not allow a successful player to carry over points won on one play to a subsequent play or plays. It either provides no reward, rewards free replays, additional time to play or non-cash merchandise, prizes, toys gift certificates or novelties. Examples of Class A COAMs include kiddie rides, skee ball, claw machines, pinball games, pool tables or jukeboxes. A Class B COAM Machine on the other hand is defined as a bona fide coin operated amusement machine that does allow a successful player to accrue points and carry over points won on a play to a subsequent play or plays. The results depend on the skill of a player. Credits may only be redeemed for in-store merchandise, fuel, or lottery tickets. Examples of Class B COAMs include video line up, match up or similar machines. Check out additional Georgia COAM Industry Terms here to stay up to date on everything you need to know about Skill Gaming, the Georgia Lottery Corporation (GLC) and COAMs.
Master License & Location License Fees:
Class A COAMs: The license fees for Class A COAMs will vary depending on whether or not you own your Class A COAM devices. If you do not own your Class A COAMs, the Master Licensee who owns the machines will be responsible for the Master License fees. The owner of Class A COAMs must pay the following annual Master License fees:
- 5 or fewer machines = $500 (and if any additional machines are added during the same calendar year, from 6-60 machines: an additional $1,500 must be paid);
- 6-60 machines = $2,000 (and if any additional machines are added during the same calendar year, from 61 or more: an additional $1,500 must be paid); and
- 61 or more machines = $3,500
In addition to the Master License fees referenced above, a Location must also pay an annual Location License fee for each Class A COAM offered for play:
- $25 per Class A COAM
Class B COAMs: A Location is prohibited from owning its Class B COAM devices. A Master Licensee owns the Class B COAMs and places them in a Location for play. Regardless of the number of Class B COAM devices in your location (Georgia law limits the maximum number of Class B COAMs in one Location to nine, unless a local ordinance mandates a lesser number), the Master Licensee will need to pay an annual $5,000 Master License fee.
In addition to the Master License fees referenced above, a Location must also pay an annual Location License fee for each Class B COAM offered for play:
- $125 per Class B COAM
Master Licensees are prohibited from paying the Location License fees referenced above. All payments can be made online by either ACH payment or credit card at www.gacoam.com, and are subject to a non-refundable payment processing fee and an administrative fee of $100.
If the GLC does not grant you a Location License, you will be refunded the machine fee(s) minus the credit card/ACH processing fees and $100 to cover administrative costs. A refund will not be granted if you have an existing liability for any other fees or taxes due, as the refund will be applied to that existing liability.
Machine Decal Fees:
Every COAM offered for play in a Licensed Location must contain a decal issued by the GLC. Each Class A COAM decal sticker costs $25 and each Class B COAM decal sticker costs $125. These decals are paid for and provided by the Master Licensee.
Timing of Payments:
You may renew your Location License starting on May 1st (dates subject to change) through June 30th. Applicants who do not renew their Location License by June 30th of each licensing year will be subject to a non-refundable late fee of $1,000 starting on July 1st. An existing COAM Location Licensee will not be allowed to apply for a new Location License to avoid a late fee.
In addition to Licensing Fees, there are fines that you may be subject to should you make the mistake of not following the law or the GLC’s rules. In addition to these fines, you also risk the loss of your license for a violation of these infractions. Location Licensees should familiarize themselves with the COAM law and the GLC’s rules and regulations to avoid any potential infractions. Important and common infractions include, but are not limited to:
- Cash Payouts or Illegal Prize Redemption – You may not award cash for any winnings earned on your Class B COAMs. All winnings are to be redeemed for in-store, non-cash merchandise items such as food, fuel and lottery tickets. You are also unable to allow patrons to redeem their winnings on alcohol, cigarettes and/or firearms.
- Inducements – You are not to accept any type of inducements from a Master License Holder, Manufacturer or Distributor.
- Violating the 50% Rule – This rule is designed to discourage businesses from operating like gambling establishments who rely primarily on the revenue made from their Class B machines to stay in business. It’s important to ensure that your Class B COAMs do not make more than 50% of your monthly gross retail receipts for your business.
- Lack of business records – This is imperative when running and operating Class B COAMs not only to keep yourself accountable but to also help you report accurate information to the GLC.
- Manipulation of Machine Meters or Games – Tampering with COAMs to help improve outcomes for patrons or prevent winnings is prohibited.
- No written contractual agreement between the Location License and Master License Holders – Before your COAMs go live it is required that you have a written contractual agreement between yourself as a Location License Holder (LLH) and your Master License Holder (MLH). This contract must span a minimum of a 12-month partnership.
- Not having required decals for each machine – Each of your machines must have a valid (not expired) decal provided by the GLC.
- Illegal Gaming/Gambling – It is illegal to conduct any unauthorized gambling at your location.
- Not Having Proper Signage at Your Establishment – At minimum, it is a requirement that each establishment has the following signage and licenses present within the gaming area at all times. For more information on signage at your COAM establishments check out this blog Sign of the Times. Required signage includes:
We hope that this guide helps provide you with additional information on what to expect when applying for your Location License and what is needed to maintain this license. With Tom's Amusement as your MLH it is our goal to help you stay on top of maintaining your license to allow the continuation and growth of Skill Gaming at your establishment.