The Pennsylvania Senate passed legislation Wednesday to expand casino-style gambling to websites and airports, approve online lottery games and reinstate a requirement that casinos pay millions to host communities. The measure passed 38-12 and was sent to the House, where changes were expected. Here is a look at the highlights:
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ONLINE GAMBLING
The state’s casinos would get an opportunity to pay $5 million for a license to operate slot machine-style games through an online portal and $5 million for a license to operate peer-to-peer table games online, or $10 million for both. The money would go into the state’s main bank account, called the general fund. After 90 days, other entities would have the opportunity to apply for the licenses that casinos do not seek. The tax rate on online gambling would be commensurate with the tax rates on land-based casinos, 16 percent on peer-to-peer table games and 54 percent on slot machine-style games. Online casino-style gambling is legal in just three states: Delaware, Nevada and New Jersey.
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LOTTERY
The Pennsylvania Lottery would be able to feature online games, including its existing games, instant tickets and raffle games. The proceeds would go into the state Lottery Fund, which subsidizes programs for the elderly. The lottery would be prohibited from operating casino-style games online, such as poker, roulette, slot machines and blackjack. Four states - Georgia, Illinois, Kentucky and Michigan - allow online lottery play, according to the National Conference of State Legislatures.
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AIRPORT GAMBLING
Casinos or other entities with an online gambling permit could seek approval from the Pennsylvania Gaming Control Board to operate an online gambling parlor at an international or regional airport in Pennsylvania, with an agreement from the airport authority. The machines would be accessible only to ticketed passengers. Fees to install the machines would be $5 million at the Philadelphia airport; $2.5 million for the Pittsburgh airport; $1 million for Erie, Wilkes-Barre/Scranton, Lehigh Valley and Harrisburg; and $250,000 for Arnold Palmer Regional Airport in Latrobe and University Park Airport in State College. Airport slot-machine gambling would be taxed at a 34 percent rate to the state.
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LOCAL SHARE
Casinos operating under a more expansive license would be required to pay millions of dollars annually to their host communities, reinstating a mandate struck down by the state Supreme Court last year because it treated casinos differently. The mandate is due to expire later this week. Under the bill, Pennsylvania’s largest casinos - there are 10 currently - would pay $10 million a year to counties and municipalities. The state’s original 2004 casino law requires casinos to pay at least 4 percent of gross slot-machine gambling revenues to their host communities. That includes 2 percent to counties and 2 percent or $10 million, whichever is greater, to municipalities, except for SugarHouse Casino in Philadelphia, which was not subject to the $10 million floor. Two smaller “resort” casinos - Valley Forge Casino in suburban Philadelphia and Lady Luck Casino Nemacolin in southwestern Pennsylvania - are not included in the requirement.
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FANTASY SPORTS
Daily fantasy sports betting in Pennsylvania would become regulated and taxed at 12 percent of the contest’s adjusted revenues. Fantasy sports companies such as FanDuel and DraftKings would have to apply to the gaming board for a license and pay a licensing fee of 7.5 percent of adjusted revenues, with a floor of $5,000 and a ceiling of $50,000. Players would have to be at least 18, verify their identity and establish an account.
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CASINO MARKETING TAX
Casinos operating under a more expansive license would pay a new 0.5 percent tax on slot machine revenues into an account that would redistribute the money in annual grants to the casinos to market and improve their establishments. Last year’s two lowest-performing casinos - Mount Airy Casino Resort in the Pocono Mountains and Presque Isle Downs and Casino in Erie - would get most of the money, $5 million apiece, while SugarHouse Casino would get $3 million. The rest of the casinos could apply to the gaming board for a grant. The provision would expire after 10 years, or if every casino brings in more than $200 million in gross slot-machine revenue.
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RESORT CASINO REQUIREMENTS
Resort casinos - Valley Forge Casino in suburban Philadelphia and Lady Luck Casino Nemacolin in southwestern Pennsylvania - can pay $1 million to be relieved from requirements in the original 2004 casino law that gamblers must also take part in other amenities at the establishment.
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