Rep. Powell Submits New COAM reform bill to General Assembly

State Rep. Alan Powell is renewing a bipartisan push to reform Georgia’s coin-operated amusement machines industry, known as COAM.

Powell is sponsoring House Bill 353, which if passed, would award non-cash redemption gift cards to winners that could be redeemed anywhere in the state for any legal product, according to a report on Capitol Beat News Service.

Under current law, COAM winners can redeem their prizes only for merchandise sold in the store where the machine they played is located.

Last week, Powell told the House Higher Education Committee that with taxes from the popular COAM machines already making up the Georgia Lottery Corp.’s fastest-growing source of revenue for education, gift cards would generate even more tax funds for HOPE scholarships and the state’s pre-kindergarten program.

“You will see the proceeds explode,” he said. “It will bring in more money to the lottery.”

During an initial hearing on his bill, Powell recounted the “checkered” history of the COAM industry in Georgia and said they got out of hand with video poker.

After video poker was outlawed in the early 2000s, the Georgia Lottery Corp. took over regulation of the COAM business.

Powell said the lottery corporation has been experimenting with gift cards in portions of the state through a pilot project. Retailers who have participated in the project like the idea, he said.

A state Senate committee approved legislation last year that would have increased state taxes on COAM machine owners and retailers from 10% to 30%. But the bill didn’t reach the Senate floor for a vote.

Powell suggested the legislature keep the tax rate at 10% – divided evenly between machine owners and retailers – for now and only consider raising it later if awarding gift cards drives up revenue to the extent he is predicting.

Powell’s bill is now being considered in the House Regulated Industries Committee, which he chairs.