Online gambling on the cards again in Pennsylvania

Republican Representative John Payne has wasted no time in getting online gambling legalisation on to the agenda in this year’s sitting of the Pennsylvania Legislature, introducing his bill HB 649 to the House, although the full content has yet to be seen.

Rep. Payne has revealed that the provisions include:

* 14 percent tax on gross revenue;

* Licensing exclusive to companies already licensed by the state to provide Pennsylvanians with
gambling;

* A licensing fee of $5 million per licence.

* Limits on deposits and losses, along with tough precautions against underaged or problem gamblers
and criminal activity.

Payne is chairman of the state House Gaming Oversight Committee, where he introduced HB649 this week. The Committee has scheduled several gambling-related hearings for this session.

Earlier this month Rep. Payne prepared the ground for his new bill by writing to House colleagues,
claiming that “…developments in technology and recent legal decisions have created an opportunity to
legalize interactive gaming as a means to further enhance and complement the benefits delivered by
casino gaming, licensed facilities and the communities in which they operate.”

He pointed out that internet gaming has been authorised in nearby states which are in competition with Pennsylvania, and that many state residents play on unregulated and illegal online gambling sites, making it desirable to regulate and licence under the auspices of the state Gaming Control Board, and then shut down illegal operators.

In a statement this week, Payne said: “Right now millions of Americans, including Pennsylvanians,
participate in illegal online gaming where no regulation currently exists.

“By enacting effective state policy, we can help curb the illegal market while ensuring strong safeguards are in place to protect consumers.”

“A recent study released by a Philadelphia-based economic consulting firm named Internet gaming the largest potential new revenue source for Pennsylvania’s gaming industry. If enacted, the study estimates online gaming would generate approximately $120 million in the state for the first year. Some gaming officials have estimated it could bring an excess of $300 million in ongoing revenue.

“We are currently facing a projected $2 billion budget shortfall. I think it’s important we consider all
responsible options to boost revenue before we consider asking our taxpayers for more money to fill that deficit.

“The implementation of legalized online gaming in Nevada, New Jersey and Delaware demonstrates the technologies exist to regulate Internet gaming safely and effectively.”

Payne’s House Committee on Gaming Oversight is scheduled to hold an exploratory hearing on internet and mobile gambling on April 16 this year. Committee members include Representative Tina Davis, who proposed a legalisation bill two years ago but did no succeed (see previous reports).

Industry observers point out that federal attempts to ban online gambling through the Restoration of the American Wire Act despite its trampling of states’ rights could add impetus to intrastate legalisation in states like Pennsylvania.

Payne can expect opposition from the Coalition to Stop Internet Gambling and lobbyists, all funded
generously by land casino magnate Sheldon Adelson, who remains strongly opposed to legalised online gambling.

On the brighter side, the recent agreement not to push “bad actor” clauses between Caesars
Entertainment and Pokerstars parent Amaya Gaming (see previous reports) presents a more coherent opposition to Adelson’s efforts.

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