Penn National Doesn’t Think New Gambling Laws Play Fair

Written By Marty Derbyshire on November 30, 2017
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[toc]Wyomissing-based Penn National Gaming has just one Pennsylvania gaming facility, Hollywood Casino at Penn National Race Course. There’s more than 2,300 slots and video poker machines on the property. Plus, there’s 50 table games and a 16-table poker room.

Its Central Pennsylvania location is miles from any other casino, but that’s becoming a problem.

The property grossed approximately $245 million from gaming in 2016. However, that put it in the bottom half of the state’s 12 casino properties. It’s just a small fish in a $3.2 billion pond.

However, outside of PA, Penn National actually owns and operates dozens of casinos in as many as 18 states across the country. That makes it Pennsylvania’s largest casino company. Yet it still can’t catch a break from state lawmakers.

When Gov. Tom Wolf signed a comprehensive gambling expansion bill into law in October, the state authorized the construction of up to ten satellite casinos. The plan was to create 25-mile buffer zones around existing casino properties. The buffer zones were created so these new facilities wouldn’t eat away at the existing businesses.

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Penn National Gaming wants a bigger buffer

The state is now in the process of figuring out who wants one and where. But in the meantime, Penn National Gaming says the playing field isn’t a level one.

Company executives say Hollywood Casino at Penn National Race Course will likely be facing more competition from these satellite casinos than anyone. Now, it’s considering a lawsuit to fight it.

At issue is the fact casinos built closer together in other parts of the state help create larger buffer zones. As a result, these casinos are getting more protection from potentially cannibalistic satellite casinos than others.

Harrah’s Philadelphia is close enough to Mohegan Sun Pocono to create a massive buffer zone across one side of the state. Sands Bethlehem enjoys a more-than 125-mile area where it can be free of competition from satellites. Plus, the area around Rivers Casino and The Meadows Racetrack and Casino in Pittsburgh extends 95 miles.

Additionally, Penn National Gaming says statistics show most of it’s customers come from outside of 25 miles surrounding the property. This makes its constricted buffer-zone dilemma even worse.

Mount Airy buffer bolstered

Apparently state lawmakers don’t think it would be fair to change the legislation to create a larger buffer zone that would only benefit Hollywood Casino at Penn National.

However, they may have already done that for Mount Airy Casino Resort. The legislation included language prohibiting satellite casino construction in sixth-class counties. That nearly tripled the buffer around Mount Airy. It did nothing for any other casino property in the state.

Penn National Gaming could buy it’s way out of the problem. It could apply for a satellite casino license of its own. That process would require a minimum bid of $7.5 million. Plus, $2.5 million for gaming license and whatever it costs to build a new facility to make sure it’s the one cannibalizing itself.

For now, the company is considering its legal options. It’s also awaiting the possibility state lawmakers will reconsider. They’re hoping the state legislature will go ahead and change the buffer-zone language in the bill and finally give its largest casino company a break.

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Marty Derbyshire

Martin Derbyshire has more than ten years of experience reporting on the poker, online gambling, and land-based casino industries for a variety of publications including Bluff Magazine, PokerNews, and PokerListings. He has traveled extensively, attending tournaments and interviewing major players in the gambling world.

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