PA Police Seize Video Gaming Terminals, Nearly $180K In Gambling Bust

A Pennsylvania law enforcement raid of bars resulted in a big haul of illegal gambling cash and outlawed video gaming terminals and slots.

Pennsylvania law enforcement raid of bars resulted in a big haul of illegal gambling cash and outlawed video gaming terminals and slots.

Last week, according to Pennsylvania news station FOX 43, the Pennsylvania State Police Bureau of Liquor Control Enforcement raided 48 watering holes across four counties. About $177,000 was seized.

“The ongoing operations of illegal gambling devices and illegal video gaming terminals, while often viewed as a victimless crime, result in lost tax revenue for Pennsylvanians and victimize households of citizens whose family members have gambling addictions,” said BLCE Director Major Scott T. Miller.

The Pennsylvania Office of the Attorney General will aid in prosecuting the cases, the article says.

The raid came shortly before a legislative hearing into the legalization of VGTs at private establishments in the state.

Unregulated odds are part of the problem

The slots and video gaming terminals seized posed a problem not only for law enforcement, but also for the people gambling at the various illegal machines.

As Fox 43 points out, the owners of the machines can set the odds on the machines or set the machine to take in a certain amount of money. In the latter case, it can remove odds from the gambling equation.

This puts gamblers in a compromised position, as they don’t know exactly how poor their odds are before they play.

However, that’s not the only problem gamblers or bars face when operating illegal slots and VGTs.

Gamblers can lose out without protection of law

There’s no guarantee a bar would even have to pay a customer who won money on its machine. And what legal recourse would the gambler have if the establishment refused to pay up? None.

That’s the case of proponents of legalizing VGTs in PA more from Penn Live on Monday’s hearing on VGTs:

Rep. Mike Sturla said many skirt the law by saying they haven’t paid out any winnings from the illegal machines. Since they aren’t regulated, the state doesn’t receive any revenue from the proceeds and players aren’t guaranteed their winnings will be paid.

“The only payouts go to patrons they know,” the Lancaster County Democrat said. “[The bartender] may think I’m a gaming enforcement agent.”

In Pennsylvania, the Small Games of Chance Act governs the legality of gambling machines. According to the SGCA, Pennsylvania allows licensed gaming at racinos, the Pennsylvania lottery and bingo games that meet state requirements and local regulations.

The BLCE executed a similar bust in 2016, FOX 43 reported, in which it seized 706 illegal video gambling machines and nearly $170,000 in cash.

VGTs would cannibalize PA casinos?

The discussion about VGTs in PA comes in the context of the state trying to generate more revenue from the gaming industry. One of the possibilities is the legalization of PA online casinos.

While online gambling would actually help land-based casinos, should it be legalized, there will almost certainly be some cannibalization of existing revenue with VGTs.

The argument of VGT proponents is that the activity is going on anyway, so the state should license it and protect consumers. That, of course, sounds a lot like the argument for legal and regulated iGaming.

Of course, it’s actually possible for law enforcement to do raids of bars in PA like the one above. Stopping unregulated online gambling has proven to be nearly impossible in the US.

Third Time Could Be The Charm For Possible Gettysburg Racino, But A Fight Looms

Adams County businessman David LeVan hopes luck will be on his side this time when trying to put a casino near Gettysburg.

Adams County businessman David LeVan hopes luck will be on his side this time when trying to put a casino near Gettysburg.

Right now there are 12 casinos in Pennsylvania. If LeVan has anything to say about it, that number will become 13 in a few years. In January, LeVan applied for the only available casino license in the state. That license would allow gambling along with harness racing.

The name of the proposed casino is Mason-Dixon Downs. It will, assuming permits are secured, operate in Freedom Township. In a letter drafted by LeVan’s legal counsel, he said the casino and racetrack will boost the local economy.

“Mason-Dixon Downs will deliver unprecedented opportunities for Freedom Township, surrounding communities, Adams County, local business, and most importantly, residents through hundreds of jobs,” said in a copy of the letter posted on EveningSun.com. “Host communities have received tens of millions of dollars in gaming funds for important projects and enhancements.”

What’s ahead for Mason-Dixon Downs

To build the casino and racetrack, LeVan will have to draft a land development plan. It will have to appease the Pennsylvania Horse Racing Commission and the Pennsylvania Gaming Control Board.

Should LeVan be successful with both organizations, he’ll have licensure as a designated harness-racing facility and a Category 1 casino.

However, LeVan faces strong opposition from Freedom Township residents.

Local residents don’t want a racino

LeVan has tried to win approval for a license twice in the past 12 years. Both times he failed, and both times he proposed sites near Gettysburg.

One of the factors impeding his progress is the opinions of locals, who are, in many cases, fiercely protective of the tranquil environs in and around Gettysburg. The most vocal opponents are part of No Gettysburg Casino, an initiative focused on keeping casinos out of the area.

No Casino Gettysburg Chairperson Susan Paddock called Mason-Dixon Downs a “failing proposition” in an interview with a local Fox affiliate.

“The nation is infuriated at the idea of taking this hallowed ground and putting a casino anywhere near it,” Paddock said. “It’s a failing proposition because there simply aren’t enough people here to make a casino work.”

The No Casino Gettysburg contingent was also outspoken in 2011 when the PGCB decided not to grant LeVan a license for a Gettysburg-area casino.

Penn Live wrote that opponents in attendance the day of the PGCB’s ruling let loose with “shouts, cheers and ovation” when the decision was announced.

Has PA gaming industry already his saturation point?

In addition to the concerns above, there is also the possibility that the state simply doesn’t need more casinos. Gaming revenue in PA has been down year-over-year in recent months.

And while a new casino could be additive in revenue, it might also cannibalize existing revenue.

The state legislature is considering a wide range of possible gaming expansions, including legislation that would authorize PA online casinos.

Valley Forge Betting Big On Skill Slots Amid Casino Facelift

Valley Forge Casino Resort CEO Eric Pearson recently announced he’s adding 60 new slots to the casino floor, some of the skill-based variety.

Skill-based slots are coming to Pennsylvania.

Changes ahead for Valley Forge

Valley Forge Casino Resort CEO Eric Pearson recently announced he’s adding 60 new slots to the casino floor. While there were no specific details as to the type of slots to be added, we do know that many of them will be video-game gambling machines (VGMs).

These machines already debuted at the likes of Caesars Entertainment casinos and the Tropicana in Atlantic City, but this is the first time they have popped up in Pennsylvania.

Pearson’s explanation of how the games work belies the potential in VGMs.

“Your skill can have an effect on the outcome,” he said. “It’s like if you play Tetris or Candy Crush, if you have more practice and you’re a better player, you can improve the outcome through your skills.”

A few slots details are still unknown at Valley Forge

Pearson didn’t say what company will provide the slots. It certainly could be GameCo, the developer that debuted VGMs at the 2016 Global Gaming Expo in Las Vegas. The other company in the space is Gamblit Gaming.

What we do know is that the big spend on new slots will bring more new slots to Valley Forge than it’s bought in the past five years.

This new development is part of Valley Forge’s $6 million facelift, which started late in 2016 and finished up this month. Things had already been looking up for Valley Forge — one of two Category 3 casinos in the state — on the revenue front in some recent months.

The King of Prussia property’s Casino Tower was the focus of the renovation.

According to a Valley Forge press release, the renovation project included the addition of two “Super Suites” boasting more than 1,400 square feet of space, a kitchen, ice maker and dishwasher.

The tower’s suites also received and upgrade, moving from outdated decor to a more modern and understated tone.

Why so many skill-based slots?

At some point, researchers say, millennials lost interest in slots. The repetition and chance-laden odds of the games don’t interest them.

Developers like GameCo realized the opportunity in this segment of the population and chose to integrate video games with slot machines.

In reality, the “slots” aren’t slots at all, but video game terminals linked to one another and integrated with regulated betting systems.

Players bet on one round of gameplay — 60 to 90 seconds in the case of GameCo’s Danger Arena — and competition commences. However, players aren’t battling each other on the same game. Participants plays their own game, trying to rack up as many points as possible. Scores are tallied at the end of the round, and payouts are given to the top finishers.

What’s interesting about all of this is that the philosophy behind these terminals was proved correct by Pearson, a 34-year-old millennial who has said he took to the games after trying one himself.

Pennsylvania Lottery Celebrates 45th Anniversary, Generated $4 Billion In Sales Last Year

The Pennsylvania Lottery just turned 45 years old, with sales around the state eclipsing $4 billion in the last fiscal year.

The Pennsylvania Lottery just turned 45 years old.

The milestone brought about a nostalgia-laden press release from the state’s lottery department. Drew Svitko, the lottery’s executive director, said the organization’s growth during the past four-and-a-half decades has been incredible.

“From humble beginnings, the Pennsylvania Lottery has grown to offer a wide variety of in-state and multi-state draw games, scratch-off instant games, and we recently introduced Fast Play games,” Svitko said in a press release.

The lottery generated more than $4 billion in sales across more than 9,200 retail locations in the 2015-16 fiscal year.

Lottery launched with 50-cent tickets

When the lottery started in 1972, Pennsylvania casinos didn’t exist and neighboring New Jersey was an equally barren casino wasteland. Secretariat was one year away from locking down the Triple Crown.

Weekly drawings offered a $50,000 grand prize, and there were occasional drawings for $1 million, according to the press release.

The lottery’s first year was a successful one: $57.7 million in net revenue shattered projections of $30 million.

Three years later, the lottery hosted its first televised drawing and sold its first scratch-offs.

The next big milestone came in 1982, when the lottery introduced a lotto-style game: Pennsylvania Lotto.

According to the lottery’s “History” webpage, Pennsylvania Lotto ran for nearly six years and handed out million-dollar prizes to 400 people.

Seniors benefit from lottery contributions

A portion of the lottery’s proceeds go to five distinct state programs, all of which provide relief and support to the state’s seniors, the press release noted:

  • Property tax and rent rebates
  • Transportation
  • Care services
  • Prescription assistance
  • Local services provided through Area Agencies on Aging across the state

By 1987, the lottery had contributed more than $10 billion to state and local senior services. To date, these programs have received nearly $27 billion from the lottery.

A promotional video from the state lottery highlights the experience of seniors at the Heritage Senior Community Center, a facility that receives lottery revenue.

“It’s just wonderful for all the older people,” one testimonial said. “There are some here that never see anybody all day long, and this is what they live for.”

According to a Pennsylvania Lottery Benefits Guide, 52 area agencies in all 67 Pennsylvania counties receive lottery funding.

That money provided, among other things, 8.9 million meals in 2015-16. Each day, lottery money is used to deliver 24,000 meals to older Pennsylvanians, the guide says.

Brief fling with online lotteries in 2015

Two years ago, the lottery could’ve undergone a major change by offering online lottery play, which happens in states like Michigan and Illinois.

Pennsylvania’s House Gaming Committee held a hearing dubbed “Exploring the Potential of Online Lottery/Gaming in Pennsylvania.Neither online lotteries nor PA online casinos materialized in the state. Online lottery and gambling are back on the table this year as lawmakers consider a gambling expansion package.

But 45 years later, the lottery is still going strong.

Image credit: Icatnews / Shutterstock.com

Pennsylvania Regulators Make Problem Gambling Awareness Push

The Pennsylvania Gaming Control Board is highlighting problem gambling in March, part of a larger national effort.

The Pennsylvania Gaming Control Board is highlighting problem gambling in March, hoping to educate state residents about the signs, dangers and reasons behind problem gambling.

The PCGB’s campaign includes an informational booth that will appear in the state capitol building. It will be active three days this month: March 14, 22, and 30 from 11 a.m. to 1 p.m.

Elizabeth Lanza, director of the PGCB’s Office of Compulsive and Problem Gambling, said that for gambling is more than just a way to pass the time or have some fun for problem gamblers.

“For some individuals, gambling is not simply a recreational activity, but something uncontrollable that can lead to debilitating problems that create negative consequences for the person, their family and society as a whole,” she said.

The PCGB’s move coincides with the National Council on Problem Gambling‘s (NCPG) declaration that March is Problem Gambling Awareness Month.

A two-tone blue ribbon and the hashtag #havetheconvo are the identifiers for the campaign.

The effort comes as the state considers an expansion of gambling in the state, including PA online casinos.

The month’s goals: Awareness and screening

According to the NCPG’s website, nearly 80 percent of Americans gamble at least once a year.

While most people can easily do a one-and-done session at a casino or website, those who struggle with problem gambling — estimates put the number at six million Americans — find themselves unable to control their urges or the time they spend gambling.

“Problem gambling touches every corner of our society, afflicting inner cities, suburbs and rural communities,” the NCPG’s website says. “No age, income or ethnic group is exempt.”

Self-exclusion program provides a way out

The state has put in place a mechanism to help problem gamblers curb their addictions. That is the Pennsylvania Self-Exclusion Program.

In this program, problem gamblers can submit their names to a list that. Inclusion on that list will bar them from entering a Pennsylvania casino for one year, fives years or their lifetime.

The program carries with it the possibility of criminal trespassing charges should individuals on the list enter a casino.

More resources on problem gambling

To learn more about problem gambling, head to the NCPG’s website. If you are a problem gambler and need help, call 1-800-GAMBLER.

If you or a loved one may have a gambling problem, but you’re unsure if it’s a legitimate addiction, head to PAproblemgambling.com to take a 20-question quiz.

Future Of Pennsylvania Online Gambling Legalization Remains Murky

The possibility that the Pennsylvania state legislature could pass a bill to legalize and regulate online gambling continues to languish in the Senate.

The possibility that the Pennsylvania state legislature could pass a bill to legalize and regulate online gambling continues to languish in the Senate.

Lawmakers had yet to vote on any bill containing iGaming. Only two days remain — Oct. 26 and one day in November — before the Senate closes for the season, adding an extra sense of urgency to the proceedings. Days could still be added to the session.

Bill passed through House, stalled in July

HB 2150 is what’s known as an “omnibus bill,” which means it includes several different types of legislation, all dealing with gambling. A major component of the bill is online gambling, which proponents say is already taking place in the state and should be regulated.

The bill went through the House pretty easilywhen lawmakers Gov. Tom Wolf set aside $100 million from a gambling expansion in the state’s 2016-17 budget, it looked as though online gambling was a no-brainer in Pennsylvania.

But the Senate failed to pass the bill during its summer session, which meant those interested in the legislation had to wait until the fall session to see an outcome.

There has been little movement in September or October.

Experts not sure if anything will happen

That tumultuous history leads up to this week’s Senate session, in which there is skepticism as to whether any bill containing iGaming will be up for vote again before the fall session closes.

Things started looking even worse for online gambling on Wednesday:

 

Rep. John Payne, a longtime proponent of online gambling legislation, was quoted as saying he thinks the odds of the bill passing are 50-50, earlier this month. It seems as though the more time that passes, the more uncertain politicians and industry experts become about the bill’s future.

Two other factors increase the time squeeze. First, Payne is retiring in November, which means PA online gambling is losing its most influential proponent. Payne has been vocal about his support of the bill, and serves as the chair of the House Gaming Oversight Committee.

Second, Payne says that, if iGaming doesn’t pass this year, an entirely new bill would have to be proposed next year.

It all adds up to what appears to be bad news for PA online gambling, at least in the short term. Any effort now seems destined to wait until 2017.

Online Gambling, Fantasy Sports In House Gaming Committee’s Plans

The Pennsylvania House Gaming Oversight Committee is planning a public hearing to review states that have legalized online gambling and daily fantasy sports.

The wait is over.

More than two months after the Pennsylvania House passed a bill legalizing online gambling and daily fantasy sports, the House Gaming Oversight Committee is scheduled to meet on Tuesday for a public hearing reviewing states that have already legalized online gambling and DFS.

That list includes New Jersey, Nevada and Delaware for online gambling. For DFS, those states are:

  • New York
  • Massachusetts
  • Virginia
  • Indiana
  • Tennessee
  • Mississippi
  • Colorado
  • Missouri

Common sense says the Senate should be holding a hearing on online gambling as well, but its lack of action has online gambling proponents and the House antsy over the bill’s future.

The Senate has introduced a new DFS-only bill, but its chances to move independent of other gambling expansions is murky.

House to Senate: It’s time

Tuesday’s public hearing is, in one sense, might be just for show. The gaming committee and the House already approved the bill, so this isn’t about convincing anyone in its own ranks. Experts are of the opinion that the meeting is about getting the Senate to pass a bill allowing PA online casinos and DFS.

Here’s the big picture:

  • The Senate has not yet voted on any bill containing online gambling or DFS
  • The Senate’s fall session is nine days long.
  • If the bill isn’t passed during those nine days, it’s pushed back again; this time to 2017.

There’s a sense that the committee is passively telling the Senate, “It would be nice if you passed this bill since so many other states have already done it in the past three years.”

Bill is Payne’s last shot before retirement

Rep. John Payne, head of the Gaming Oversight Committee, has long been a vocal supporter of expanding the state’s gambling laws. However, Payne is retiring after the state’s November elections; a win like this before his final day in the House would be a sweet victory for the Dauphin County Republican.

After the June vote, Payne released a statement lauding the House’s bipartisan vote in support of online gambling regulation:

“Right now, Pennsylvanians who are playing these games online are at risk for fraud and abuse, and it’s nearly impossible to prevent children from gambling online or to protect problem gamblers. This legislation is needed to safeguard our children, our problem gamblers and our gaming consumers. Without it, we are only allowing the ‘wild west’ atmosphere that currently exists to continue.”

Expanded gambling will boost state budget

While pro-gambling folks in Pennsylvania would love to see the state finally pass the bill, the state’s budget would be equally as happy; it includes $100 million in gambling revenue.

That $100 million is possible revenue generated by online gambling in the state in year one, mostly from licensing fees. In 2015, Payne co-authored an opinion piece on PennLive.com, in which he estimated that online gambling revenues could top $300 million in a mature market.

Casinos might want to see it, as well; August was one of the state’s first bad months, revenue-wise, in quite awhile.

Mount Airy Wants To Axe $10 Million Casino Host Fee

Pennsylvania’s Mount Airy Casino Resort doesn’t like paying the piper, so they’re taking up their case with the Supreme Court of Pennsylvania.

The Pocono casino’s beef is with the Pennsylvania law that says casinos must pay a yearly $10 million “host” fee, in which they give the amount to the municipality in which they’re located.

The fees are not an issue for successful casinos bringing in huge revenues, but Mount Airy reps say the substantial fee creates hardship for some casinos, and that the fee is unconstitutional.

Mount Airy says fee isn’t fair, uniform

In an article earlier this week, The Morning Call outlined Mount Airy’s position. The argument boils down to the interpretation of the state constitution’s use of the word “uniform” when talking about how taxes should be uniform “upon the same class of subjects.”

The host fee’s amount is an either/or proposition. Either casinos pay two percent on $500 million in gross slot machine revenues, or they pay $10 million.

Since the nine casinos who are subject to the law don’t bring in the $500 million, they pay the two percent on slots revenues. Then they pay out of pocket to make up the difference between those taxes and $10 million.

More from the Morning Call:

“That creates an unequal tax that has some casinos paying a much bigger portion of their revenues to their host community. So, while the $10 million paid by Pennsylvania’s most lucrative casino, Parx in Bensalem, was just 2.8 percent of the casino’s 2014 gross slot machine revenue, the $10 million Mount Airy paid was more than 7 percent of its $140 million in revenue for 2014.”

Mount Airy’s attorney, Michael Sklar, said the casino’s demands are simple: “uniformity and fairness.”

Communities say fee is necessary

The host municipalities in which the casinos are located are also crying foul at the prospect of the yearly fee being changed.

Sen. Pat Browne, head of the Senate Appropriations Committee, told the Morning Call that getting rid of or cutting back on the tax would put communities in dire situations.

“I don’t know exactly how we’d go about it, but given that this fee has been established for a decade,” Browne said, “we’re not just going to let this money be stripped from municipalities that rely on it.”

Mount Airy not the first casino to go after host fee

Earlier this summer Rivers Casino raised the same issue. On June 27, the casino’s holding group, Holding Acquisitions Co., sued the Department of Revenue and Secretary Eileen McNulty.

Like Mount Airy, Rivers said in a statement that it didn’t want to be treated differently than other casinos.

Meanwhile, Pittsburgh Mayor Bill Peduto’s office released a statement saying it would fight the Rivers lawsuit.

“Rivers Casino knew about this funding commitment prior to applying for their license, and knew this funding was due to the city for hosting them,” Peduto said.

About one month later, the casino dropped the suit without explanation.

Harrah’s Philadelphia has also fought the fee in court.

Western Pennsylania Casino Lady Luck Nemacolin Faces License Renewal

Lady Luck Nemacolin is up for its casino license renewal when the Pennsylvania Gaming Control Board holds a hearing next month.

When Lady Luck Casino opened in July 2013, it was hailed as a casino for the “not-so-high-rollers.”

It featured $5 craps. $10 blackjack. A rustic log-cabin facade and a resort whose spacious pool deck gave way to an emerald expanse of grass and Pennsylvania’s undulating hills.

On September 14, the western Pennsylvania casino will attend a hearing at which the Pennsylvania Gaming Control Board will begin to decide whether to renew the casino’s operator license.

The hearing is a standard process that takes place every three years as stated in the regulations laid out in section 1326 of the Pennsylvania Race Horse Development and Gaming Act.

Woodlands Fayette, LLC, is the operator of the casino.

Jobs, access to gambling advantages of opening

When Lady Luck Nemacolin opened in 2013, local residents praised the Fayette County facility for the jobs it created.

A couple of weeks after the casino’s debut, Lady Luck provided nearly 500 jobs, 340 of which went to residents of Fayette County.

The casino also created a new option for residents in that part of the state. The two closest casinos, Rivers Casino in Pittsburgh and Meadows Casino, are located more than an hour’s drive away.

Slot license didn’t come easy for Lady Luck

Lady Luck made headlines long before its doors opened, however. The casino’s owners, Woodlands Fayette LLC, won a casino license from the PGCB, beating out three other management groups who proposed sites in various locations in the state.

The PGCB finally awarded the slots license to Woodlands Fayette by a vote of 6-1 in April 2011.

According to Legal News Online, part of the board’s reasoning in awarding the sought-after license to Woodlands’ existing resort property was because, “it possesses the finest well-established resort hotel out of all the applicants and is best positioned to benefit from the addition of a Category 3 licensed facility.”

The decisive decision did not sit well with competing company Mason-Dixon Resorts LP, who filed a petition requesting that the state Supreme Court review the legitimacy of the decision.

The gist of its argument, a 2012 Pittsburgh Post-Gazette article pointed out, was that Woodlands Fayette wasn’t eligible for the license because its slots facility was more than a mile away from its hotel. State regulations for Category 3 slots licenses say that the license will be awarded to a facility that places the slots “in” their hotel, not in a different location.

The case would come down to the court’s interpretation of the word “in,” one of the judges hearing the arguments observed.

There were other arguments put forth by Mason-Dixon’s attorneys, two of which were that the resort didn’t have enough rooms to meet the 275-room requirement, and that the resort was not “financially sound.” The opposition held that the gaming board didn’t perform adequate financial due diligence.

In the end, the Supreme Court backed the board’s decision, saying there wasn’t enough proof to withdraw Woodlands’ license and once again make it available to applicants.

Gaming board invites input from citizens

A recent press release from the PGCB announced the license renewal hearing would take place at 10 a.m. on Sept. 12 at the Wharton Township Municipal Building.

Those who want to contribute comments to the hearing can mail their opinions to the following address:

PA Gaming Control Board
P.O. Box 69060
Harrisburg, PA 17106
Attention: Board Clerk

Comments can also be emailed to [email protected] or fax them on 717-265-7416. All comments must be submitted on or before Sept. 12.

SUNY Report: Pennsylvania Headed For Tough Times If Online Gambling Bill Passes

A new report suggests that Pennsylvania land-based casinos should expect revenue decline, even as the state of PA looks to pass online gambling legislation.

Big revenues today don’t equate to big revenues tomorrow.

That’s the conclusion of a recent State University of New York (SUNY) report about the Pennsylvania gaming industry. In the 40-page document, SUNY Rockefeller Institute of Government analyst Lucy Dadayan said while the state’s gambling-tax revenue is a boon for the budget now, history says that revenue will decline over time.

The report, titled “State Revenues from Gambling: Short-Term Relief, Long-Term Disappointment,” comes in the midst of the proposal of HB 649, a bill that would legalize and regulate Pennsylvania online gambling.

Bad times call for more gambling

According to Dadayan, history shows expanding gambling is one of the tools of choice for states who are struggling with revenue.

“States are more likely to expand gambling operations when tax revenues are depressed by a weak economy, or to pay for new spending programs,” she wrote.

Dadayan went on to point out “many states” augmented the gambling sector in response to the Great Depression.

Wallets more frugal after economic downturn, competition increases

The report said a couple of other factors that have soured long-term revenues are:

  • Consumers coming off the Great Recession are tighter with their discretionary spending.
  • Those consumers are more prone to dial back the money they put toward casinos and racing.
  • The continued expansion of gambling operations in Maryland, New York City and Ohio will continue to cut into Pennsylvania’s gaming revenue

Dayadan’s final conclusions were not positive. She said Pennsylvania’s gambling revenues “are short-lived and create longer-term fiscal challenges for the states as revenue growth slow or declines.”

Gambling revenues in the context of HB649

As mentioned earlier, the release of the study comes at an interesting time. The Pennsylvania House of Representatives Gaming Oversight committee approved HB 649 with a vote of 18-8 in November. However, the bill never made it through the House.

In December, the bill was tabled, the legislative equivalent of an airplane holding pattern.

Lawmakers “untabled” the bill this past March and now it is open for discussion once again. The most outspoken legislative proponent of the gambling bill is Representative John Payne, a Republican from Dauphin, Penn.

Payne leads the oversight committee which first approved the bill, and he is the prime sponsor of the bill.

Payne points to revenue as reason to pass bill

In an interview with The Morning Call, Payne said his main argument is that the bill will inject millions of dollars into Pennsylvania’s budget. He scoffed at Dadayan’s claims that gaming revenue isn’t sustainable over the long haul.

“We know people are going to gamble, so we might as well regulate it and tax it. I hope they didn’t waste too much taxpayer money on that study,” Payne was quoted as saying. “What we need to do is give casinos the tools to compete with other states.”

Payne’s disregard for the study was evident when he questioned whether or not the author had ever heard of Las Vegas.

Keystone state pulls in second-most tax revenue in nation

However, it’s easy to understand why the politician would feel confident that expanding the state’s gaming sector would bring in enough money to alleviate the state’s $2 billion budget gap.

According to numbers provided by The Morning Call, Pennsylvania lottery, land-based casino and off-track betting tax revenues rank second in the nation. Only New York earns more in those three areas, but around two-thirds of the state’s $3.2 billion take comes from lottery sales.

One of the big factors behind the state’s hefty tax revenues is its 55 percent tax on slot machines, a huge number compared to sub-10 percent rates in New Jersey.

Report says uncertain future ahead despite big tax revenues

Despite Payne’s optimism about the bill, Dadayan’s research points to skepticism. Revenues for several states dropped significantly between 2008 and 2015.

Though that time frame includes the recession, Dadayan said competition from new casinos in competing states played a sizable role taking a few states’ big revenue and distributing it to states with expanded gambling laws.