Pennsylvania Is Likely to Have a Senate Vote on a Gaming Bill in the Fall

The Pennsylvania State Senate has not voted on an gambling bill which was passed this summer by the General Assembly, but most believe a vote is forthcoming in the fall session. If passed, Pennsylvania would allow more forms of land-based gambling, as well as online gambling.

The optimism stems from the fact that the revenue from additional gambling was used to pass the 2016-17 budget, suggesting a groundswell of support for the measure. The revenue would have to be found elsewhere, if the measure did not pass.

To update readers on the legislation in the bill, we’ve included the major components for the online and offline gambling measures. The House passed these proposals in July 2016.

Pennsylvania Online Gambling

The House proposed legalized online gambling for desktop computers and mobile devices, which would be taxed at a 16% rate. Land-based operators at casino and racetrack-casinos would have the right to operate online gaming portals.

Representative Russ Diamond [pictured], who represents the 102nd District in Pennsylvania, defended his vote for the iGaming provisions. Diamond said, “Online gaming is already in Pennsylvania, it’s just not being regulated. People with gambling addictions, they’re going to play whether it’s legal or not.”

New Taxes on Casino Table Games

One facet of the new gaming laws already is in place. That is a 2% tax increase on table games throughout the state. The 2% increase raises the tax rate on table games to 16%, which is in line with the proposed online gaming tax rate.

The tax increase was included in the 2016-17 budget, so it is an accomplished fact. The decision was criticized by the state’s gaming operators, including Eric Shippers of Penn National Gaming. Shippers told the Lebanon Daily News that the increased tax rate would lead to diminishing returns, stating, “The more you tax something, the less you get of it.”

No Video Lottery Terminals

One proposal failed to pass in the House vote. Video lottery terminals, which are similar to slot machines, did not gain approval. The VLTs would have been placed in the state’s bars and private clubs, if they gained the proper licensing.

Gaming operators lobbied against VLTs, due to the new form of competition it would entail. The operators convinced lawmakers that it would increase competition without significantly increasing tax revenues. Penn National Gaming supported a modified plan, which Penn said would have allowed VLTs, but with more restrictive placement to have maintained a “level playing field“.

Fantasy Sports Provisions

The bill also has provisions for licensed, regulated, and taxed daily fantasy sports. 55 million Americans play fantasy sports every year. Millions also play daily fantasy sports, a form of the game involving online sites like DraftKings and FanDuel.

All fantasy sports involves drafting individual players from sports teams in NFL football, Major League Baseball, or NBA basketball onto imaginary rosters. This lineup of players are pitted against opponents. In traditional fantasy sports, these rosters are pitted against friends, family members, and coworkers in season-long competitions called seasons. While people gamble on the outcome, a yearly bet on fantasy football is hardly seen as a gambling problem.

Difference in DFS and Sports Betting

In daily fantasy sports, the lineup is built for a set of games played on one single day. The contestants fields this lineup against other entrants in the DFS contest, with a paid entry fee. A site which acts as organizer takes a 10% fee on all entry fees, while the rest is dispersed as winnings. Many people see DFS as another form of sports betting, while others see the activity as a game of skill, because the game involves resource allocations and roster decisions on many component parts.

Most sports bets are based on one simple factor in a game: win/loss, point spread, over/under, or who scores first. For that reason, many people argue that traditional sports wagers involve a higher degree of chance.