Internet Gaming a 'Growing Business' for Pennsylvania

Members of the House sponsored a new bill that would legalize and regulate online gaming, generating new revenues and protecting gamblers from predatory sites.

by Howard Frank, Pocono Record / April 27, 2015

(TNS) -- Get ready to add a new word to your vocabulary — iGaming. It might be coming to a computer near you.

Pennsylvania's Mount Airy Casino Resort will host a public hearing for online gaming held by the House Gaming Oversight Committee on Tuesday. The hearing will focus on how to keep the state’s casinos competitive. The hearing is at 2 p.m. at the casino at 312 Woodland Road in Paradise Township. It is open to the public.

“Internet gaming is a growing business,” State Rep. John Payne, R-106, said. “Right now, millions of Americans, including many Pennsylvanians are playing games of chance online.”

Payne is the chairman of the House Oversight Gaming Committee.

New Jersey and Delaware have legalized online gaming. Payne thinks it’s time for Pennsylvania to join in.

He, along with 19 other members of the Pennsylvania House of Representatives, sponsored a new bill, HB 649, to legalize and regulate online gaming. Payne said the bill would generate new revenues and protect Pennsylvania gamblers from dishonest and predatory gaming sites.

“… unlike visitors to Pennsylvania’s brick-and-mortar casinos, these players are at risk for fraud and abuse by unlicensed and unregulated offshore gambling sites operating outside the law,” he said.

Under the legislation, online gaming licenses would only be made available to the state’s 12 existing casinos.

Each casino would have to pay $5 million for an online gaming license. That’s a relative pull of a slots handle compared with the $50 million cost for a slots license, or $16.5 million for a table games license for category one and two casinos.

The bill imposes a 14 percent tax on online-generated revenues, just like table games. But while some of the slots revenues are dedicated to lowering property taxes, online gaming revenues would go into the state’s general fund, like those of table games.

The bill prohibits online gaming at Internet cafes that restrict access through membership dues.

A recent study by a Philadelphia-based economic consulting firm estimated iGaming could bring in an additional $120 million in gaming revenues in the first year, Payne said. It would help offset the state’s projected $2 billion budget deficit without levying new taxes, he noted.

Nevada is the only other state, besides New Jersey and Delaware, that allows iGaming.

State Sen. Mario Scavello, R-40, is concerned with the impact on the problem gambler of legalized online gaming. He voted against two earlier bills with iGaming.

“I worry about the gambling when you can go in front of a computer at home. It makes it much easier for problem gamblers to gamble,” he said.

He acknowledged that online casinos still exist, whether or not the state is involved.

“We’re not going to stop it. By legalizing it and putting rules in place, you’re protecting the player and generating revenues,” he said.

New Jersey generated $13.1 million in Internet gaming revenue for March. Its best month since it went operational in November 2013, according to Pennsylvania Gaming Control Board spokesman Richard McGarvey said.

“Regulating online gaming in Pennsylvania would require operators to incorporate responsible guidelines for Internet gambling into their overall compulsive and problem gambling plans, enable the Pennsylvania Gaming Control Board to establish consumer protections, such as limits on time played, deposits and losses and prominent links to help lines and other gambling resources on online gaming websites.” Payne said. “It would require state-of-the-art technologies and “Know Your Customer” practices to ensure minors can’t gamble.”

The bill also has provisions addressing compulsive and problem gambling.

Measures under the legislation “will help drive illegal operators out of the Pennsylvania market,” Payne said, by giving gamblers a regulated option to play online.

Advances in geolocation software and other verification technologies give operators a way to limit iGaming to within the state’s physical borders. It also includes the ability to exclude anyone under the age of 21 from gaming online.

©2015 the Pocono Record, Stroudsburg, Pa. Distributed by Tribune Content Agency, LLC.

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