The existing licenses expire June 30, which means some LVL retail locations may be without gambling machines and possible business on July 1.

Herk Sparachane, president of the West Virginia Amusement and Limited Video Lottery Association, said the number of limited video lottery machine licenses the state is issuing is down by more than 2,000.

Furthermore, bidding for operators' licenses is driving up the cost to have the limited video lottery machines. A decade ago, the cost for an LVL machine license was $2,000. The lowest bid this time around is $8,500.

"Everyone started bidding and it drove the cost sky high," Sparachane said.

Many LVL locations rent their gambling machines from operators, and the operators are responsible for bidding on machine licenses. The operators can choose which LVL businesses they want to lease machines to. But because of increased costs for licenses, the operators will likely choose to lease to higher-profiting LVLs since the operator gets a portion of the LVLs' profits.

"It will eliminate the mom and pops, the small bars that don't do very much in the machine business," Sparachane said. "(The operators) are only going to keep (gambling machines) in the key locations."

Because of that, some LVLs won't have gambling machines, and for many small businesses, those machines are their main source of income.

"Hopefully they will stay in business. It's going to be real hard, but the worst part is if they own the real estate, it's going to be real hard to sell if they don't have machines," Sparachane said.

In addition, for the businesses that are able to keep gambling machines, The Charleston Gazette reported that hundreds of the machines in bars and clubs could be shut down for days, or even weeks, during the transition.

Lottery officials said it will be impossible to have all limited video lottery machines across the state up and running on July 1, when the new licenses go into effect.

Lottery officials told retailers and operators about potential problems with the transition Wednesday during a video lottery machine manufacturers' expo in Charleston.

The lottery receives more than $7.5 million in revenue a week from limited video lottery.

Stay with NEWS9, WTOV9.com and WTOV9 Mobile for continuing coverage.

Previous Stories: August 18, 2010: Suit Filed Over W.Va. Video Lottery Permits July 9, 2010: Video Lottery Machines May Cost More July 9, 2010: Video Lottery Minimum Bid Raised; Retailers Worried July 8, 2010: W.Va. Video Lottery Permit To Cost At Least $5,000