An effort to tax a lucrative and legally iffy gaming sector appears to be in jeopardy amid Pennsylvania budget talks, potentially threatening a funding stream that could have been a bargaining chip during negotiations.

At the center of the dispute are skill games, untaxed and unregulated devices that resemble slot machines and can be found in bars, restaurants, and convenience stores across the commonwealth.

Gov. Josh Shapiro, a Democrat, threw his weight behind regulating the games in his budget proposal as a way to boost state revenue. His administration projected that legalizing and taxing the machines’ revenues at 42% would bring in $150 million this coming fiscal year, and that the amount would double in the future.

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