Coming on the heels of a report noting that total revenue from Pennsylvania slot machines for November was down 1.3 percent from last November, the state Senate recently passed a resolution, calling for a study of gambling in Pennsylvania, including the possibility of legalizing online gambling.
The Legislative Budget and Finance Committee will conduct the study with a report due May 1.
Senate President Pro Tempore Joe Scarnati called for the study, noting in interviews with Harrisburg reporters that he was concerned about declining revenues at the state’s 12 casinos.
Scarnati, R-Jefferson County, said he’s particularly worried about revenue from the casinos because they employ 6,000 people and provide nearly $1 billion a year in property tax relief and hundreds of millions more in aid to local governments and economic development programs.
“I’m not an expert on what is cutting edge in the gaming industry, but what I can tell you is we’re losing revenue and. we better make sure we step it up,” the senator said.
“We can just watch our revenues from (casino) gaming—that we use for property tax abatement—just continue to go down, or we can try to step in and look and see what suggestions can come from other states, can come from gaming operators, can come from consultants on how to maintain or grow those revenues.”
New Jersey went live with internet gambling last week, projecting about $150 million in new state revenues.
The question for Pennsylvania lawmakers is whether Internet gaming would take away even more revenues from the casinos or would it bring in a younger audience of people who rarely go to the casinos?
And this all comes on top of Gov. Corbett signing a bill, giving the state’s bar and tavern operators the chance to run monthly raffles, daily drawings and other small games of chance in their premises, bringing in a projected $156 million in new state tax revenues.
Scarnati said the state is going to be facing some serious financial problems in the coming year and finding new revenue is going to become very important.
“The bad news is we’re facing a one billion dollar structural deficit, and that’s not spending one more dollar on public education; that’s not spending one more dollar on higher education, or a dollar more for nursing homes and hospitals,” Scarnati said. “That’s just maintaining the status quo.”
Of course, all of this is worrisome, and you can only wonder how long Pennsylvania can tap the state’s gamblers for more money.
We’ve seen the problem firsthand here in Fayette County with news that revenues from the Lady Luck Casino Nemacolin in Wharton Township have been lower than expected since the facility opened last July.
While the casino might not be closing its doors anytime soon, local officials probably won’t be seeing the tax revenues the facility was expected to produce.
And it might be a cautionary tale for the state as a whole. If the gambling revenue doesn’t add up, what will Pennsylvania lawmakers do?
Certainly, there’s nothing wrong with doing a study of gaming in Pennsylvania, and we can only hope that something good will come out of it.
In the end, though, Pennsylvania won’t be able to legalize new ways of gambling forever. At some point, Pennsylvanians will have to either start raising taxes or cutting programs.
Given the looming financial challenges ahead, it’s probably better that state legislature start dealing with the problem sooner rather than later.
Published Dec. 18, 2013, in Allied News. Pick up a copy at 201 A Erie St., Grove City.