As part of Pennsylvania’s widespread gambling expansion legislation, the Keystone State was supposed to get up to 10 new casinos. Well, satellite casinos, that is.
These smaller casinos, also called mini-casinos, can feature 300 to 750 slot machines. Some might also include up to 40 table games.
But the plan for 10 new mini-casinos hasn’t panned out. Only five potential sites were auctioned before the market turned cold and license auctions stopped. That was supposed to mean an end to auctions forever. But the PA legislator, facing virus-induced budget shortfalls, planned yet another auction on Sept. 2, 2020.
The new bidding – Round Three – is for a license that was denied for a lack of financing – and possibly the questionable association of a former owner barred from the gambling business in PA. Mt. Airy Casino had sought a satellite location in Beaver County, north of Pittsburgh. And another site, Parx is in limbo due to unresolved geology issues – at their Shippensburg site.
That leaves just three projects moving ahead, though two remain idle for now as Penn National regroups financially from the virus shutdown.
The mini-casino law passed in October of 2017. However, the satellite casino bidding process did not begin until January 2018. That entailed a series of live auctions, which awarded five licenses. Those auctions had run out of bidders in April 2019.
The Pennsylvania Gaming Control Board (PGCB) ran a second round of auctions on Sept. 3 at the direction of the Legislature in hopes of kickstarting renewed interest. But there were no bidders.
Now there is one more bite at the apple for the former Mt. Airy license. But that means the five remaining licenses will forever remain unclaimed.
In all, $114 million in license fees were raised.
Take a look at where the venues were proposed. The timelines currently plan most launches for 2020.
Current satellite casino projects in Pennsylvania
Here is a look at the announced satellite casino projects in Pennsylvania, including the latest developments and potential launch dates:
Hollywood Casino York
Penn National’s Hollywood Casino plans a satellite casino in a vacant mall space in south-central Pennsylvania.
The location is the York Galleria Mall, Springettsbury Township. That’s just northeast of the city of York, in York County.
In late August, the township approved the redevelopment plans for the mall at the site of a vacant Sears store. Plans call for a 79,300 square-foot satellite casino property. The company filed the official paperwork for the property at the Sept. 12 PGCB meeting.
Their license was approved in December and rehab work was ongoing until the virus forced a shutdown. Penn, facing financial issues, has not resumed work.
Hollywood Casino Morgantown
Hollywoods second mini-casino location is generally referred to as Hollywood Morgantown. The Morgantown designation refers to a zip code that sprawls across three counties, was approved by the gaming board in June.
The actual location is near a PA Turnpike exit and I-76 in Caernarvon Township, Berks County.
What made the location controversial is that the Morgantown area includes Lancaster County. All of the towns in Lancaster had opted out of hosting a mini-casino after PA’s 2017 gaming expansion law which led to the Class 4 or mini-casino category.
The PGCB approved the project in June despite objections from residents outside Caernarvon.
The proposed project will encompass more than 81,000 square feet.
Work was ongoing until the virus forced a shutdown. Penn has not resumed work. They are free to move ahead, but the virus created financial problems.
Stadium mini-casino project
Stadium Casino is planning a mini-casino site in a vacant space at Westmoreland Mall in western PA.
Stadium’s parent company, Cordish Companies, is working on redeveloping the site in Hempfield Township, Westmoreland County. Plans call for a 100,000 square foot mini-casino.
The location is about 50 minutes east of Pittsburgh. The PGCB approved the license.
Work has on the project resumed after a shutdown due to the virus.
Parx location in Shippensburg on hold
Greenwood Gaming and Entertainment Inc., which operates Parx Casino in suburban Philadelphia, has encountered an issue with its proposed mini-casino site in Shippensburg Township, Cumberland County.
They had plans for a 63,000 square foot casino off Exit 29 of I-81. Two previous sites got nixed. Carlisle leadership elected not to rescind its opt-out status. That led to Parx submitting plans for a Shippensburg location.
But geologic testing now shows the location is prone to sinkholes due to limestone rock formations. That has stalled their plans for now.
The company is “actively looking for an alternative site,” within their designated area, according to PGCB spokesman Doug Harbach.
Mount Airy Pittsburgh
Mount Airy’s mini-casino project, Mount Airy Pittsburgh, is dead. Forever.
Unable to raise the necessary funding, the PGCB nixed the proposed project for Big Beaver Township in November. A hyperlocal news site reported that an ongoing investigative review regarding Mount Airy’s former owner and his involvement in the satellite location was also in play.
Mount Airy’s plan had been for a mini-casino at the juncture of I-376 and PA Turnpike, about an hour northwest of Pittsburgh.
Casino officials had once spoken of possibly opening by the end of 2019. But then the project stalled, sputtered, and died.
They are out 25% of the more than $21.8 million spent to buy the license.
Mini-casino auction recap
April 4 auction: After two-month hiatus, auctions return
Auction winner: Hollywood Casino at Penn National
Winning bid: $7,500,003
Total bidders: 1
Satellite location: Morgantown, PA in Lancaster County
Penn National secured a second satellite property in West Cocalico Township, PA. The location is between Philadelphia and Harrisburg. It strengthens the boundary around Hollywood Casino, which claimed it was receiving unfair treatment as a result of the mini-casino process.
Read more on the second Penn National mini-casino site.
Feb. 22 auction: Sands slip-up gives Parx the property
Auction winner: Parx Casino
Winning bid: $8,111,000
Total bidders: N/A
Satellite location: Shippensburg, PA in Cumberland County
There was some drama around the fourth license, as Sands initially put in a winning bid of $9,885,000. However, because Sands selected a location whose radius where the company could build overlapped with Mount Airy’s site, PGCB voided the bid. As the only other bidder, Parx Casino essentially won by default.
Parx selected a location west of the first satellite property in Yoe, PA. The South Newton location is also close to Harrisburg and the Maryland state line.
Feb. 8 auction: Mount Airy storms New Castle
Auction winner: Mount Airy Casino
Winning bid: $21,888,888.88
Total bidders: 3
Satellite location: Big Beaver, PA in Lawrence County
Mount Airy may be one of the smaller casinos in Pennsylvania, but it brought big bucks to the auction, bidding $21.89 million. It’s New Castle, PA location was just a few miles from the Ohio state line. With Youngstown, OH just 30 minutes away, the mini casino was meant to draw traffic from the Buckeye State.
More on Mount Airy’s bid.
Jan. 21 auction: Stadium Casino sets sights on Pittsburgh
Auction winner: Stadium Casinos LLC (Philly Live! Casino)
Winning bid: $40,100,005
Total bidders: 4
Satellite location: Greensburg, PA in Westmoreland County
Even though Stadium Casinos LLC had not broken ground on its Philadelphia property yet, it wasted no time getting into the satellite casino game too. With a relatively large bid, the group secured the Derry location, which is just east of metropolitan Pittsburgh. With a property just 43 miles from Rivers Casino in the heart of the city, the Stadium group seems intent on having a presence in both of Pennsylvania’s major cities.
More on the second project from Stadium Casinos LLC.
Jan. 10 auction: Penn National bids big for Yoe, PA-area satellite property
Auction winner: Mountainview Thoroughbred Racing Association, LLC (aka Hollywood Casino)
Winning bid: $50,100,000
Total bidders: 4
Satellite location: York, PA in York County
Hollywood Casino’s owners made jaws drop with a hefty bid of $50 million, which was well above industry projections. Most were expecting the initial bid to be between $30 – $40 million, but Penn National went big to secure the Yoe location.
The selected site is roughly 50 miles south of Hollywood Casino and 20 miles north of the Maryland state line. It appears Penn tactically selected a location that would best help protect the centrally located Hollywood from competition.
Read more about Hollywood Casino’s winning bid and plans for the new property.
Overview of the satellite casino law
Here is more about how the process works, including:
- Provisions of the satellite casino licenses
- Calendar of dates
- Map of opted-out municipalities
The law allowed for ten new casinos that fall into a new category of gambling establishment, Category 4. Should the license holder want to offer up to 30 table games, it would need to pay for an additional $2.5 million license.
These satellite properties originally could not be within 25 miles of an existing Category 1, 2, or 3 property. When the second round of auctions resumed, that distance requirement was a little tougher. New satellite properties could not be within 40 miles of any Category 1-3 property as well as any of the five Category 4 properties currently in development.
There was also a stipulation in the law affecting Mount Airy Casino, which effectively creates a bigger buffer zone for the relatively small and isolated casino. Penn National, which owns Hollywood Casino and The Meadows‘ parent company Pinnacle, started suing the state over the unfair treatment, but eventually dropped the legal action.
Here is a breakdown of the existing casino properties by category:
Category 1: Racinos
- Harrah’s Philadelphia
- The Meadows Racetrack and Casino
- Mohegan Sun at Pocono Downs
- Parx Casino and Racing
- Hollywood Casino at Penn National Racecourse
- Presque Isle Downs
Category 2: Standalone casinos
- Mount Airy Casino Resort
- Rivers Casino Pittsburgh
- Wind Creek (formerly Sands Casino Bethlehem)
- Rivers Philadelphia (formerly SugarHouse Casino)
Category 3: Resort casinos
Most of these properties are also the people who got first crack at satellite properties. The initial auctions were only open to Category 1 and 2 properties.
There was one additional group included in the auctions though. That is Stadium Casino LLC’s Philly Live! casino project at Stadium Park in Philadelphia. The property is still under construction, but once it is complete, it will be the state’s fifth standalone Category 2 casino.
When it comes to where to put these satellite casinos, groups are limited by more than just a buffer zone around existing casinos. From the time Gov. Tom Wolf signed the bill into law in early November until the end of 2017, municipalities across the state had the option to opt out of hosting a property.
In order to opt out, municipalities had to hold a public meeting, take a vote, and send written documentation of that vote to the Pennsylvania Gaming Control Board (PGCB). Over 1,000 municipalities in Pennsylvania opted out, while only a handful publicly lobbied to get a new casino.
PGCB released a map of the buffer zones and opted-out cities once the process was over. Yellow circles reflect the buffer zones. Blue indicates a municipality which opted out: