Pennsylvania online gambling still on the table

Wednesday’s defeat of Pennsylvania Governor Tom Wolf’s $2.4 billion tax proposal has possibly created space for legalised online gambling bills currently stalled in the legislature, industry observers claimed yesterday.

They point out that House Majority Leader Dave Reed has given gambling expansion a prominent place on his list of alternatives to the tax increases proposed by the governor.

“I think we need to have a discussion first on what other revenues are on the table,” Reed said after the House debate on the governor’s proposal.

“We need to come to a conclusion on liquor reform. We need to address cost drivers like our pension system. We need to look at gaming options.”

Mike Bean, president of the Mohegan Sun Pocono casino in Pennsylvania commented this week that Internet gambling as an area of potential growth has commercial appeal.

“We generally favor internet gambling for the brick-and-mortar casinos in Pennsylvania,” he said, qualifying his statement by noting that success was contingent on the right tax and fee structure imposed by the state government. “We believe that New Jersey is a good model,” he said.

There is now some pressure to resolve the prolonged political disagreement on how to address Pennsylvania’s $2 billion budget deficit; the state Legislature is largely dominated by a Republican Party intent on resisting the tax increases that the Democratic Party governor says are essential to balance the budget.

Earlier this week Governor Wolf said he was open to an expansion of gambling as part of a package of revenue generating possibilities. However, he said that he doubted such initiatives would solve the deficit problem facing the state .

Adding another problem, Democrat and Senate Minority Leader Jay Costa, said his caucus is firmly against balancing the budget on the backs of gambling and an unpredictable revenue stream.

Nevertheless, the state does accrue revenues from land and lottery gambling; the state lottery’s $1 billion in revenue last year went to support programs for the elderly, and more than $1.2 billion in tax collections on slot machine gambling in the last fiscal year went mostly for school property tax reductions and horse racing industry subsidies.

Observers note that the consideration of gambling legislation is still at an early stage. There has so far been no floor debate or negotiations with Wolf’s office, although there are bills at committee stage in the state legislature.

Sen. Kim Ward has proposed that Pennsylvania’s land casinos be allowed to offer Internet gambling for a $10 million permit fee to people who register and are present in the state, and a bill by Rep. Nick Kotik, D-Allegheny, would allow casinos to position slot machines at Pennsylvania’s six international airports.

Senate President Pro Tempore Joe Scarnati, said this week that gambling bills may have been opposed earlier this year, but that the prospect of massive tax increases and a crisis in government could bring about a change of view.

“All of a sudden, gaming doesn’t look that bad now,” he said.