Pennsylvania Tables Online Gaming Bill For A Couple Weeks

Posted on October 31, 2016

[toc]A proposed plan to temporarily extend a crucial local tax for Pennsylvania communities with a casino was amended late this week to include the legalization of online casino games, as well as the regulation of daily fantasy sports.

After amending it, lawmakers in Pennsylvania’s House voted 108-71 in favor of House Bill No. 1887, sending it back to the Senate for consideration. A potential vote would happen in mid-November, but lawmakers there could just let it die.

While the House has been eager to get online gambling approved (it passed a separate internet casino proposal in June), the Senate has been less interested.

The measure has not received bipartisan support.

“Leadership decides if a bill gets a full vote,” online gaming advocate Sen. Kim Ward (D-Westmoreland) said. “It won’t unless the Democrats can supply a few because there aren’t 26 Republicans to pass it.”

Pennsylvania’s Senate has 50 members, and there are currently 31 Republicans and 19 Democrats.

A State Supreme Court ruling in September said that the local share tax on slot machine revenue was unconstitutional because it affected state casinos differently.

Nine out of the 12 casinos want online gaming over a solution in the form of a tax increase.

Slots in Pennsylvania account for more than 75 percent of the casino industry’s gamin win. Online gaming in the Keystone State would include slots, but it could help bring the slot-table game breakdown closer to the balance seen in Nevada.

The Silver State’s slot machines account for 60 percent of overall gaming win.

Slot revenue so far in October

According to figures released by the state Gaming Control Board, Pennsylvania’s 12 brick-and-mortar casinos had slot revenue of $144.8 million from Oct. 1-23.

That money came from $1.9 billion in wagers.

Parx Casino led the way among state casinos with $24.2 million in slot revenue during the period.

Nearly $50 million in state tax was paid. The state gets 34 percent of slot revenue.

About $5.8 million (four percent) was paid to the local share assessment, and $7.2 million (five percent) went to the Pennsylvania Gaming Economic Development and Tourism Fund.

Another $15 million went to the Pennsylvania Race Horse Development Fund.

More than 50 percent of slot machine revenue goes back to Pennsylvania in some capacity. There are currently 26,632 slot machines statewide.

Pennsylvania Rep. John Payne (R-Dauphin), sponsor of the House online gaming bill, said the slot machine tax is a reason for the state to bolster its gaming industry. The idea is to help it remain competitive amid gambling expansion in nearby states.

“We are, like it or not, the majority shareholder in the casino industry because we get 54 percent of the [revenue],” Payne said of slot machines. “In the private sector that would mean we are the majority shareholder. It behooves us to make sure our casinos do well because we get more money.”

Slot revenue so far in 2016

The casinos won $192.2 million from the machines in September, which was a year-over-year increase of 2.4 percent.

Here’s a look at slot revenue by month this year:

  • January: $184.8 million (2.1-percent increase)
  • February: $200.2 million (9.3-percent increase)
  • March: $211.3 million (1.7-percent increase)
  • April: $209 million (1.5-percent increase)
  • May: $208.9 million (1.1-percent decrease)
  • June: $190 million (1.1-percent decrease)
  • July: $213.4 million (1.1-percent increase)
  • August: $193.9 million (4.5-percent decrease)
  • September: $192.2 million (2.4-percent increase)

Through September, the casinos have averaged a 1.3 percent slot machine revenue increase. The casinos won nearly $2.4 billion from the games in calendar year 2015, which was an increase of two percent compared to 2014.

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