May 7, 2014 4 min read

A state Senate committee plans to examine whether Pennsylvania has a gambling problem – or problems.

Econsult Solutions Inc. released its report Wednesday about casino gambling in the state, evaluating the health of the industry and what may be ahead. It touched on nine points, including Internet gambling; the impact Pennsylvania casinos have on each other and the effects out-of-state facilities have on them; and regulatory changes that might occur.

The highlight of the report, commissioned by the Joint Legislative Budget and Finance Committee, stated if Pennsylvania “authorized online gaming,” it could generate $113 million in tax revenue annually.

Kim Ward, R-Hempfield Township, is chairman of the Senate Community Economic and Recreational Committee, which oversees gambling legislation in the state. She said that body will have a hearing to discuss the report when the Senate is back in session in June.

Ward said in a statement she is “specifically interested” in the findings related to online gambling, potential regulatory adjustments and what the granting of new casino licenses might impact the state.

“The committee will seek to get feedback from both the (Pennsylvania Gaming Control Board) and the industry on how best to move forward,” she said. “If there is a need to reopen the existing gaming laws to address new trends and changes … we should address that now.”

Sen. Tim Solobay, D-Canonsburg, is not on that committee but is familiar with casinos and casino issues in Pennsylvania, One of his oft-stated criticisms is that the state’s 12 casinos are concentrated in the western and eastern thirds of the state, with the densely populated south-central area being underserved.

He said “there are a lot of concerns about Internet gaming.”

“Safety for the public, would it be there?” he asked. “Would we make revenue as a state? Would it be in-state or not? If you look at Internet gaming, I believe it should be in our existing casinos. A lot of things need to be investigated.”

Solobay said he believed $113 million in annual tax revenue is a low figure. “I think that with the ease of doing gaming at home, revenues could be higher. My guess is for all the problems the state could encounter, I’m not sure $113 million would be worth it.”

Sen. Wayne Fontana, D-Brookline, is on the Community Economic and Recreational Development Committee. He said late Wednesday afternoon that he hadn’t had a “chance to digest the whole study” and could not comment in depth.

“Before I take a position, I’ll wait to hear all testimony,” Fontana said. “The main consideration is the financial impact on the casinos.

“I do understand the increasing competition from other states on online gaming. I know about the $113 million (tax revenue) figure. But we have to make sure it doesn’t hurt our brick-and-mortar casinos.”

The study’s other findings:

n Tax revenue from casinos statewide grew from 2006 to 2012 before dropping by 4 percent in 2013.

n The casinos have made $3.1 billion in initial capital investments and annually produce about $2.9 billion.

n Casinos generate about $81 million a year in non-gaming tax revenues.

n Neighboring states are applying competitive pressures on Pennsylvania casinos.

n ?Pennsylvania casinos should be able to generate $215 million in revenue beyond the current $3.11 billion.

n The casinos face in-state competition, especially around Philadelphia.

n Pennsylvania’s gaming tax rate of 44.5 percent is competitive for the Mid-Atlantic region.

n The state imposes rigid regulatory requirements on casinos, some of which “could/should be reconsidered, including licensing of non-gaming employees; license duration for casino operators; restrictions on credit/cash advances; and third-party check cashing.”