Realizing that one of the only ways to plug its budget hole is to make drastic changes to existing laws, lawmakers in Pennsylvania approved the largest expansion of gambling for over a decade. On Friday, the Pennsylvania House voted 109-72 in favor of a bill that will legalize online gambling, among other things. Earlier last week, the Pennsylvania Senate passed the bill after a vote of 31-19.
The bill has now headed to the desk of Governor Tom Wolf who has the final say. It is unclear which direction the governor will take since his opinion on internet gambling has not been disclosed.
Some of the important points of HB 271
- The law will allow for the construction of 10 ‘mini’ casinos.
- Truck stops will be allowed to operate video gaming terminals.
- Pennsylvania airport passengers will be allowed to play online casino games on their mobile devices.
- An intrastate online gambling industry will be legalized and regulated, with players allowed to wager on specific games for real money on their desktop or mobile devices within the state borders.
- Existing Pennsylvania land casinos will be able to offer online gambling to their customers.
- A licensing process for slots, poker and other table games will open up.
- Pennsylvania Lottery tickets will be allowed to be sold online.
- Daily Fantasy Sports will be legalized.
54% Slot Rate Criticized
In the meantime, the interactive chief of casino operator Penn National has come out strongly against the 54% online slots tax that the bill wishes to enforce, should the Governor sign HB 271 into law. Penn National is one of 12 existing land casinos that could receive an online gambling license. The license will cost operators $10 million each.
Speaking about HB271, Chris Sheffield said: “Obviously we are pleased that this has finally moved, but 54% for online slots in the highest tax rate on the planet. It’s completely unworkable and the only reason one might buy a license is to then begin an active lobbying effort to reduce the rate to where one might actually make money on the operation.”
Sheffield said that Penn National had run the numbers many times and said that the company could not see how they could work, given that they still had to pay license fees, set up costs and ongoing maintenance costs. He warned that some operators would bail the fledgling industry, before it even began.
