Two pledge continued support; Sands silent
Two casinos in Pennsylvania, where the legislature failed this session to pass a replacement for a local host fee that was overturned by the state Supreme Court, have moved to implement temporary replacements to keep the host-fee money flowing into local coffers while state lawmakers address the host-fee issue in the next session.
The host fee established by Pennsylvania’s gaming law—2 percent of slot revenues or $10 million, whichever is greater—was held to violate the state constitution’s requirement for uniform taxes. The court instructed that lawmakers pass a substitute fee by January 26.
State House leaders passed a bill to replace the host fee with a straight $10 million payment—likely to be opposed by the same casinos that complained the host fee was unfair—but the Senate refused to take it up after House members added legalization of internet gaming and daily fantasy sports to the measure.
Senate leaders have indicated they are willing to wait until the next session, placing the gaming bill low on the priority list at last week’s lame-duck session of the legislature. That left the local communities depending on casino taxes, options like tax anticipation loans, lines of credit or other stopgap measures until a new host fee is passed.
That is, unless casinos opt to continue providing host-fee money on a regular basis, as have Pittsburgh’s Rivers Casino and Mohegan Sun at Pocono Downs. Neil Bluhm’s Rush Street Gaming which, through subsidiaries, owns both Rivers and the SugarHouse Casino in Philadelphia, went public shortly after the Supreme Court decision to announce that payments to the host communities will continue.
Last week, Pittsburgh Mayor Bill Peduto announced that the city reached agreement with Rivers Casino to continue payments for the $10 million fee, or 2 percent of slot win, through at least 2017.
In his annual budget message, Peduto said the agreement closes a large budget shortfall.
“To reinforce Rivers Casino’s strong commitment to our hometown, we have worked collaboratively with city officials to ensure that $10 million in annual local share payments from Rivers Casino to Pittsburgh will continue uninterrupted through 2017,” said Craig Clark, the casino’s general manager, according to the Pittsburgh Tribune-Review.
“Harrisburg still has to deal with the issue,” Peduto said. “Whatever the new deal looks like, we’re asking to be kept whole.”
Meanwhile, the Mohegan Tribal Gaming Authority told the Plains Township Board of Commissioners last week that Mohegan Sun Pocono will continue to pay the host fee to the township until lawmakers come up with a new fee. “We are honored to be working with Plains Township,” casino President Anthony Carlucci said at the board’s monthly meeting, according to the Wilkes Barre Times-Leader. “By no means whatsoever with this tax issue are we looking to save money. Even during this hazy period, rest assured we’re going to pay you your money. The money that you well deserve and you have, I’m going to pay as long as we need to.”
“This is a great community, and we want to keep it that way,” Carlucci told the Times-Leader after the meeting. “Whatever we normally owe, we’re going to continue as if nothing’s changed. We want to keep our home community happy. That’s the message we want to send.”
There has so far been no indication from Las Vegas Sands, owner of the Sands Bethlehem resort, on the continuation of payments to the city, which depends on casino fees for 12 percent of its annual budget.
