Pennsylvania Legislature Receives Third iGambling Bill Of 2015

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Tuesday, April 14th, 2015 | Written by Stephen Smith

Pennsylvania is considered one of the US states most likely to introduce online gambling legislation within the next few years, and this is reflected in the level of interest being shown on the hot topic, with State Representative Tina Davis (D-Bucks County) recently having introduced to the state legislature a third internet poker bill of 2015. Unlike the poker-only bill sponsored by state Representative Nick Miccarelli (R-Delaware County), however, Tina Davis’s bill is similar to the one proposed earlier by state Representative John Payne (R-Dauphin County) allowing for the full range of online gambling games, and as Davis explains:

“Considering efforts across the country to legalize internet gaming, it is imperative that we maintain the integrity of our gaming industry amid inevitable federal preemption and competing states.”

Tightly Control The iGaming Industry

Tina Davis’s bill, known as HB920, seeks to exert a tighter control over any future online gambling industry than its two competing bills, with one provision stating that anyone wishing to gambling online should first register at one of the twelve casinos currently operating in Pennsylvania, who would then be responsible for checking and approving each player individually.

Davis’ bill would also require those Pennsylvania casinos wanting to run internet gambling sites to pay a $5 million licensing fee, which could subsequently be renewed for further three year periods, at a cost of $500,000 each time. In addition, the operators would be subjected to a 28% tax rate on gross gaming revenue, with the money mostly going towards the Property Tax Relief Fund, but with 30% earmarked for transit and shared ride programs for the elderly, and 15% for the state Race Horse Development Fund. Preempting HB920, State Rep. Tina Davis commented earlier this year:

“A responsible internet gaming system must be created in order to protect Pennsylvanians and the success of the established gaming industry in the Commonwealth, which has generated more than $7 billion in state tax revenue, and created more than 16,000 jobs statewide.”

A Rather Crowded Field

Tina Davis’s bill currently has a good amount of support in the Pennsylvania legislature, with a number of other Democratic representatives already having signed on as co-sponsor for HB920. Nevertheless, Davis’s bill now has to compete in a crowded field, which includes John Payne’s HB649, which sees iGambling as a viable alternative to hiking taxes, and Nick Miccarelli’s HB695, which would regulate just internet poker, whilst providing no provision for any future interstate liquidity sharing compact.

Furthermore, Tina Davis has already lent her support to John Payne by co-sponsoring his iGambling bill, while Payne has yet to reciprocate with support for Davis’ bill. Added to the fact Payne holds the post of chairman of the House Gaming Oversight Committee, with the body scheduled to hold a public hearing on Online and Mobile Gaming in a week’s time, then early indications suggest John Payne’s bill presently has the best chance of progressing during the current legislative session.

Upcoming Public Hearing On iGaming

The Pennsylvania House Gaming Oversight Committee is scheduled to hold two public hearings on online gambling within the next month, the one on April 16th covering “Internet Gaming and Mobile Gaming,” and the second hearing on May 6th covering Internet Gaming. US poker grassroots advocacy group, the Poker Players Alliance (PPA), has welcomed the hearings as a serious effort by state legislators to discuss and better understand the internet poker industry, with PPA Executive Director John Pappas explaining:

“The May 6 hearing will provide a forum to make our best case why the Commonwealth needs to act this year. I have little doubt that online gaming opponents will be out in full force, and we need to be prepared to crush their rhetoric with facts.”

Regulated Online Gambling Potential

The Keystone state opened its first slots casino in 2006, with table games added in 2010, and by 2012 Pennsylvania had usurped New Jersey as the country’s second biggest gambling market with $3.16 billion in revenues. Of course, revenues have been falling ever since, with $3.11 billion generated in 2013, and $3.07 billion in 2014, leading lawmakers to now seek ways to reverse the negative trend and find an additional source of gaming revenue. Consequently, Pennsylvania has estimated that the state can expect to receive around $120 million from online gambling in the first year following regulation. However, that forecast is considered conservative considering that amount is roughly equal to the revenues generated by neighboring New Jersey, whose population of 8.9 million is almost 3 million people less than that of Pennsylvania.