On February 12, 2014, the Pennsylvania House of Representatives’ Gaming Oversight Committee held a hearing to receive testimony regarding the prospects of legalizing electronic gaming devices, i.e video gaming machines, in the Commonwealth. The hearing focused on gaming along the lines of what was raised in a prior session’s bill, (2014 House Bill No 1932), which sought to legalize video gaming machines for bingo, keno, blackjack and other games for use in establishments with valid liquor licenses, such as restaurants, bars, taverns, hotels and clubs.
With a looming budgetary deficit Pennsylvania legislators are exploring various ways to increase gaming related tax revenue, including potentially moving forward with internet gaming through its existing bricks and mortar casinos. This recent Gaming Oversight Committee hearing revisiting the video gaming machines issue would be another means through which to generate gaming based tax revenue. The hearing’s witnesses touted the jobs and tax revenues generated by Illinois which implemented video gaming machines in bars, restaurants, taverns and truck stops several years ago – (projected IL tax revenues in excess of $250 million in 2015). While Illinois has had success generating tax revenue and producing jobs with its video gaming machine roll out, the machines do compete, on a low end basis with the states’ existing casinos. While local municipalities in Illinois can opt out of the video gaming program that option may not exist in a Pennsylvania bill and opposition from Pennsylvania’s casino industry remains to be seen.
Also, if considering video gaming at bars and taverns Pennsylvania may be well served to learn from some of the mistakes made with the passage of last year’s Tavern games legislation. Tavern games, with its gaming regulatory scrutiny focused on the bars/tavern owners, rather than through the games’ owners and route operators, lead to cost issues and a reluctance to move forward which hampered widespread implementation of tavern gaming. In addition, while Illinois has had relative success with its multi-tiered system of manufacturers, distributors, operators and establishments, that system has one too many layers to operate as effectively as it otherwise could. Few recall Pennsylvania’s short-lived requirement of local suppliers of slot machines layered between the industry’s manufacturers and end user casinos. The removal of the local supplier requirement opened the way to the implementation of Pennsylvania casinos in 2006. Finally the Pennsylvania Gaming Control Board and its agencies are more than capable of regulating and rolling out video gaming should it become law. Bringing in other, less experienced state agencies, such as Liquor Control or the Department of Revenue would only further complicate and delay implementation should the law pass.
The Pennsylvania Gaming Control Board announced that it is now accepting applications for the one remaining casino license that must be located within the City of Philadelphia. This is the former “Foxwoods” license which was revoked by the Board in December 2010. The Board set an application deadline of November 15, 2012.
In its announcement, Board Chairman, William Ryan stated that it was in the “best interest of the people of Pennsylvania” to proceed with the application process since it appears that recent legislation, considered by the Pennsylvania General Assembly, which would have amended the current gaming law and allowed the vacant license to be located anywhere within the Commonwealth, is unlikley to move forward.
The licesne fees to operate a casino with up to 5000 slot machines and 250 table games, totals $74.5 million.
The Pennsylvania Gaming Control Board (“PGCB”) Chairman, William Ryan stated that the PGCB met last week to discuss the status of the remaining Philadelphia casino license, which was revoked from its prior holder in December 2010. Ryan stated, “At least for now, we decided not to do anything,” however [the Board] will revisit the issue… in the not too distant future.” The second Philadelphia casino license, however is not the only remaining opportunity for a new casino in Pennsylvania. There is a pending challenge to the Board’s awarding of a “resort” casino license to Nemacolin Woodlands Resort outside of Pittsburgh. There is also a remaining racetrack casino license recently held by Centaur in western PA.
Continue reading PA Gaming Control Board Considers Status of Philadelphia Casino License
On May 16, 2012, the Pennsylvania Gaming Control Board released table game results for April 2012. Compared to April 2011, overall table game revenue was up 6.83%. The state’s casinos now have a total of 1,031 table games, up from 869 in April 2011. Pennsylvania table games are taxed at 14%, so the state collected just over $8 million in table game taxes in April. Pennsylvania also collects a 2% local share, which was just over $1.1 million for the month.
“They got two names in there for the whole country and one of them is still Al Capone.”
That line, uttered by Joe Pesce’s character Nicky Santoro in the 1995 hit movie Casino, may have reflected a common view in the past toward casino exclusion lists – the lists maintained by gaming regulators in each jurisdiction of persons who are not permitted to enter casinos.
Continue reading Casino Exclusion Lists are Serious Business
Today, the Pennsylvania House of Representatives passed, on a 153-29 vote, a bill that would significantly change the landscape for the revoked Philadelphia slot license. Frank DiGiacomo and I have reported about that license here and here.
The bill, HB 65, would first remove the restriction that the remaining Category 2 slot license be located within the City of Philadelphia, and would instead allow that license to be awarded anywhere in the Commonwealth. The bill will also set up an auction process for the license. Under the auction, the minimum bid will be $66.5 million. Under the auction process, the PGCB is to retain a financial advisory firm to assist with the auction process. Continue reading PA Casino License May Go On Auction Block
Following the Pennsylvania Supreme Court’s recent rejection of the final appeal by Philadelphia Entertainment Development Partners (“PEDP”)/Foxwoods in connection with the revocation of the PEDP/Foxwoods casino license – the looming question is what happens now with that license? Philadelphia developer, Bart Blatstein has expressed his desire to build a casino, entertainment retail complex on Broad and Callowhill Streets. One small problem with Blatstein’s proposal, the Pennsylvania Gaming Control Board has taken no steps towards accepting any applications or proposals for the now revoked, remaining Philadelphia casino license.
Continue reading What’s Next for the Vacant Philadelphia Casino License?
On March 29, 2012, the Pennsylvania Supreme Court ended one long chapter of the ongoing story of the Foxwoods Casino Philadelphia project. The project’s owner, Philadelphia Entertainment and Development Partners (“PEDP”), petitioned the Supreme Court for allowance of appeal of a decision by the Commonwealth Court affirming the Pennsylvania Gaming Control Board’s revocation of PEDP’s Category 2 Slot Machine License. For all intents and purposes, the Foxwoods Casino Philadelphia project is now dead. Importantly, this means that a Category 2 Slot Machine License is now available in Pennsylvania, although it is unclear exactly what will happen with that license.
Continue reading Foxwoods Casino Philadelphia’s Journey Ends