Online gambling bill approved by Pennsylvania House

In the Pennsylvanian House Tuesday Rep. John Payne’s online gambling legalisation bill HB2105, packaged with the state’s budget bill, passed on a vote of 114-85, and is on its way to the Senate on a tight deadline.

An accompanying intrastate legalisation bill for daily fantasy sports also passed, with a 5 percent tax on revenue and 5 year licensing at $50,000 for casino operators or 7.5 percent of smaller operator revenues.

The measure included a variety of gambling expansion proposals which remain after a controversial inclusion of video gaming terminals was stripped out (see previous reports).

The actual $31.5 billion budget bill, the subject of heavy negotiations between Republicans and Democrats, passed on a vote of 132-68 with online gambling and a hike in tobacco taxation the chief hopes for additional state revenue.

The online gambling bill calls for licensing and regulation, with existing state casino licence holders given the opportunity to go online.

Other gambling expansion proposals include allowing slots at airports and at off-track betting sites. In the latter case the provisions are subject to the US Congress repealing the federal Professional and Amateur Sports Protection Act, which currently bans sports betting in most US states.

Our readers will recall that the bill has had an adventurous trip through the political system, at one point failing due to confusion among lawmakers, only to be resurrected and then packaged within the budget.

It still has a likely difficult passage in the Senate to face.

State governor Tom Wolf told a local radio station Tuesday that he does not believe the House’s plan raises enough money.

“I haven’t agreed to this and as far as I can tell there’s still some things that need to be worked out,” he said in a KQV-AM Radio interview.

Rep. Bill Adolph, who chairs the House Appropriations Committee, said the House could raise about $1 billion from legalising online gambling, breaking the state’s monopoly on the sale of wine, increasing tobacco taxes and launching a tax amnesty program.

House leaders said Tuesday that the House vote represented cooperation and compromise on both sides of the political aisle.

HB2105 calls for operators who wish to go online to pay $8 million for a five year licence with renewal fees of $250,000.

Services and supply companies wishing to provide technology and services to operators will pay a fee of $2 million for a five year supply licence, renewable at $100,000. In addition, operators will be taxed at 16 percent on revenue.

Unfortunately, there are restrictions in the bill on mobile gambling, which will only be permitted within airport premises….at a further hefty fee of $1 million per airport and tax at 34 percent plus a levy of 20 percent, rendering it hardly viable as a commercial proposition, according to some observers.

On the positive side, there is a provision which could permit the negotiation of inter-state compacts such as shared player pools.

The land expansion elements in the bill carry a hefty separate fee structure.

Mark Juliano, CEO of Sheldon Adelson’s Sands Bethlehem casino in Pennsylvania, was quick to comment on the House vote, urging the state Senate to reject the gambling expansions – especially those for slots at airports and off-track facilities – which he views as unwanted competition.

John Pappas, executive director of the Poker Players Alliance, which has been active in mustering Pennsylvanian punters to lobby their political representatives, welcomed the positive vote for online gambling in the House, saying:

“Pennsylvanians deserve robust consumer protections and today the Pennsylvania House delivered. This legislation will create jobs and help the Commonwealth close its budget gap. This common sense legislation is a win-win for Pennsylvania. The online poker community urges the Senate and Governor Wolf to act swiftly to approve this measure.”

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