Gaming board: “No timetable” for implementation
Potential stakeholders in Pennsylvania’s expanded gaming industry have begun exploring the opportunities in the state’s new gaming law, signed by Governor Tom Wolf October 30 as part of a budget reconciliation package.
The law makes Pennsylvania the fourth state to legalize and regulate online gaming, but iGaming suppliers and the would-be licensees (current land-based casino operators) were only beginning to assess the opportunities in the new state industry, from possible pooling of online poker players with Delaware, New Jersey and Nevada under the Multi-State Internet Gaming Agreement to the revenue likely to be lost under a 52 percent revenue tax imposed on internet slot games.
A spokesman for the Pennsylvania Gaming Control Board said last week there is no timetable for implementation of the new gaming law, adding in an interview with a CBS affiliate that no one form of new gaming—iGaming, airport tablet gaming, satellite casinos, VGTs at truck stops, daily fantasy sports—will take precedence over any other gaming authorized by the law.
Much attention was paid last week to the section of the new law authorizing up to 10 “mini-casinos,” satellite casinos of up to 750 slots and 10 table games, to be bid on by current gaming licensees and operated outside of a 25-mile radius of any current casino. Local municipalities and lawmakers in many areas of the state have begun planning campaigns to attract mini-casinos to their areas.
Bidding for the mini-casino licenses will start at $7.5 million, with table-game licenses costing an additional $2.5 million. Prominent among cities likely to host mini-casinos are York, Reading, Gettysburg, Johnstown, Altoona, Williamsport and State College.
Lawrence County officials were among the first to say they will shoot for a mini-casino. The western county is home to the ill-fated project that was to be the Lawrence Downs casino, which fell victim to a succession of financing failures. Lawrence County Commissioner Dan Vogler announced just after the bill was signed that the county will pursue one of the satellite casinos.
The city of Altoona is another likely mini-casino target. Altoona officials have indicated interest in one of the small casinos to draw patrons back into the state who now travel by bus to Rocky Gap Casino Resort in the nearby Cumberland, Maryland area.
Not everyone wants them, though. Municipalities have the option to ban mini-casinos trough a local resolution submitted to the state before December 31, and some local lawmakers already have indicated they may opt out. Prominent among them is Lancaster, in the farming region known for its Amish population and Pennsylvania Dutch traditions. Republican state Senators Ryan Aument and Scott Martin sent a letter to each of their respective municipal governments last week asking them to act to prevent a mini-casino within their boundaries.
“As a lifelong Lancaster County resident as well as a state senator, I am deeply disturbed and troubled by the new law,” Aument said in a statement. “It saddens me to think that the face and culture of our home and our way of life could forever be negatively changed by a vice that provides no social or economic value.”
Lancaster Mayor Rick Gray told the Associated Press he likely will recommend to City Council that it vote to ban a casino. “I’m a strong believer that if you want revenue, you should raise taxes,” Gray said. “You shouldn’t really impose a regressive fee on the hopes of poor people.”
Other areas of Pennsylvania are off-limits due simply to the 25-mile rule, and by specific limitations in the new law. One provision of the law eliminates much of northeastern Pennsylvania around Mount Airy Casino Resort from contention. Fayette and Montgomery counties are also banned. Both are home to resort casinos—Valley Forge Casino and Lady Luck Casino Nemacolin.
The 25-mile rule also is the subject of objections to the new law from Penn National Gaming, one of the top operators in the state. Shortly after the gaming provisions were signed into law, Penn National spokesman Eric Schippers told the Associated Press that the operator is considering a lawsuit to block implementation of the mini-casino provision on the basis it places Penn in a uniquely bad competitive position. Penn’s Hollywood Casino outside of Harrisburg is in an area otherwise devoid of casinos, and Schippers said most of the property’s customers come from outside a 25-mile radius.
“The playing field has yet to be truly determined at this point,” Schippers said. “But I will tell you we are in the uniquely awkward position of figuring out how to protect our market share.”
By January 16, the Pennsylvania Gaming Control Board will hold the first blind auction for one of the mini-casino licenses. Only Pennsylvania’s licensed casino owners can submit the sealed bids. The auction winner gets their choice of site, with a prohibition against any other new casino within a 15-mile radius.
Gaming board spokesman Doug Harbach told CBS the mini-casino licenses will be subject to several steps before the first ground is broken. “Satellite casinos have a new auction process before we even get to awarding the license and the location and doing the background investigation,” Harbach said. “And that process is really not going to take place until mid next year or so.”
