Cannibalization? Who thinks there’s cannibalization? Certainly not Pennsylvania’s casino industry, considering it not only rebounded after two straight years of declining casino revenue, but was able to shoot past 2012’s record-setting tally and post its best year to date in terms of revenue. The state’s 12 casinos are proving to be a strong source of revenue for the state, as the state’s cut of casino revenue in 2015 reached $1.3 billion, and more importantly, all of the state’s casinos appear to be on solid financial footing moving forward. Inside the PA casino numbers 2015 saw casino revenue jump to $3.173 billion, a 3 percent year-over-year increase in revenue, and just a whisker above the previous high water mark set in 2012, when the industry posted $3.158 billion in grass gaming revenue. A historical look at Pennsylvania casino revenue from 2006-2015:
2006: $31,567,926
2007: $1,039,030,723
2008: $1,615,565,758
2009: $1,964,570,480
2010: $2,486,408,061 (table games introduced)
2011: $3,024,772,959
2012: $3,158,317,863
2013: $3,113,928,591
2014: $3,069,077,597
2015: $3,173,787,012 Overall, the state’s casinos have been extremely consistent since 2011. Revenue over the past five years has varied only 5 percent. Who were the big gainers? Pennsylvania’s top two casinos were two of the biggest gainers in 2015, as Parx Casino saw YoY revenue increase seven percent, while Sands Bethlehem Casino posted nine percent YoY growth. Interestingly, the state’s two “resort” casinos (a misnomer in the gaming industry as Pennsylvania’s “resort” designation is for resorts with strict limits on gaming), were also among the biggest gainers, as Lady Luck Casino posted an 11 percent YoY increase and Valley Forge Casino a six percent gain. The remaining casinos saw minimal YoY changes. Where did the revenue come from? Table game revenue was up nearly 8 percent YoY, as the state’s casinos totaled $808,135,353 in 2015, compared to the $749,543,217 they generated in 2014. Meadows Casino, Parx Casino, and Sands Casino all saw table game revenue rise at least 10 percent, while Harrah’s Philadelphia was the only casino in the state to see table game revenue drop YoY, but it should be noted that the drop was just 1.1 percent. Slot machine revenue was up 2 percent YoY, and outside of four casinos, was pretty much flat across the board. The four casinos that posted gains were the same four that posted the largest total revenue gains, as slot revenue at Sands (6.6 percent), Parx (5 percent), Valley Forge (6.2 percent), and Lady Luck (12.2 percent) all went up in 2015. Contrasting Pennsylvania gambling with Atlantic City Pennsylvania’s strong 2015 revenue is challenging the notion that cannibalization and over saturation will destroy casino markets. Since Pennsylvania’s casinos opened their doors in 2006, Atlantic City has struggled. After 27 consecutive years of growth, the AC casino industry experienced its ninth straight year of decline in 2015. Gross gaming revenue fell another 6.5 percent in 2015, to $2.56 billion, a number that is less than half its tally from 2006, when the city’s casinos pulled in over $5.2 billion.
2006: $5.2 billion
2007: $4.9 billion
2008: $4.5 billion
2009: $3.9 billion
2010: $3.6 billion
2011: $3.3 billion
2012: $3 billion
2013: $2.9 billion
2014: $2.7 billion
2015: $2.6 billion But Pennsylvania has avoided Atlantic City-like declines despite new competition in Ohio and Maryland. As Richard McGarvey, a Pennsylvania Gaming Control Board spokesman told the Morning Call, while there was some trepidation over the recent revenue declines in 2013 and 2014, “When you look at it, we never really fell that far. It was nothing like what happened to Atlantic City, so it was a lot easier to come back from.” Increased competition will certainly make things more difficult (New York and Massachusetts are opening new casinos, and there is serious talk of a North Jersey casino in the near future), but Pennsylvania’s continued success is certainly making people reconsider why casinos are cannibalized beyond competition and over saturation, and perhaps making the case that new casinos – or reinvestment into existing casinos – are the best forms of medicine, as they force current operators to either up their game or call it a day. Gaming reform bill The Pennsylvania casino industry could get another boost in the coming months, if the legislature can pass a sweeping gaming reform bill it is currently considering. If the proposed gaming reform package is implemented, it should lead to even greater revenues for the state’s casinos, as most of the gaming expansion is thought to be non-cannibalistic and runs through the state’s current casinos. Chief among these reforms are:
The legalization of online gambling;
The addition of slot machines (provided by current casinos) in secured, post-check-in locations at the six international airports in PA;
Allowing resort casinos to buy-out from their membership requirements and increase the number of slot machines and table games for a one-time fee;
The addition of video game terminals at off-track-betting parlors provided they are 50 miles from a casino;
Potential fantasy sports legalization and regulation, which would be run through the state’s casinos.

Contents
1 The top-line numbers for Pennsylvania casinos
2 Trending downward for PA casinos
3 Winners and losers in January for PA casinos Overall gaming revenue in Pennsylvania was down for the fourth straight month, the continuation of a concerning trend for PA casinos. The top-line numbers for Pennsylvania casinos The Pennsylvania Gaming Control Board released full-month revenue for the state in January on Thursday. The good news? Gross revenue from table games was up 2.1 percent from January of last year. In terms of real dollars, that represents an increase of about $1.5 million, to $72.6 million. The bad news? Table games didn’t make up for the poor performance of slot machines, which were down about $4 million year over year. Overall gaming revenue fell about 1.2 percent, or about $3 million, to $255.9 million total. Trending downward for PA casinos In a vacuum, the numbers being down for a month aren’t so bad. Indeed, gaming revenue for all of 2016 was up. But here’s a look at the previous five months for total gaming revenue.
August 2016 – $260,904,471 (-4.28%)
September 2016 – $260,937,476 (+2.93%)
October 2016 – $263,011,981 (-0.91%)
November 2016 – $249,637,268 (-1.38%)
December 2016: $257,228,162 (-4.64%) Including January, that’s the longest sustained period of gaming revenue decline since the state introduced casino gaming more than a decade ago. While gains in table game revenues have mitigated the losses, slot machines have steadily been in decline in PA in terms of revenue. And there’s not much sign that that trend will abate, without changes from the legislature on gambling. The state is considering a number of changes to its gambling laws, including the regulation of PA online casinos. Winners and losers in January for PA casinos The news was bad for two-thirds of the state’s casinos, which experiences losses, YoY:
Hardest hit, as it had been for much of 2016, was Harrah’s Philadelphia. Revenue was down more than seven percent to $20.4 million. It continues to shed revenue while the other Philadelphia-area casinos experience upticks.
The biggest surprise might have been Sands Bethlehem. The casino usually vies for the No. 1 position in terms of revenue. But it no badly trails Parx Casino, partly because of a drop in revenue to $42.1 million (five percent drop, $2.3 million.)
Mohegan Sun Pocono had a poor month as well, down five percent. The good news was mostly centered in Philly:
The aforementioned Parx was up nearly seven percent, and now easily leads all casinos in terms of monthly revenue ($46.5 million).
The news wasn’t quite as good at SugarHouse, but it still bucked the trend of declining revenue, posting gains of about half a million.
Lady Luck Nemacolin and Hollywood Casino at Penn National were the only other casinos that were up YoY.

Contents
1 PA casino revenue for March 2017
2 Winners and losers for PA casinos
3 Are changes coming to PA gaming? Pennsylvania casinos escaped their sixth straight month of declining revenue — barely. PA casino revenue for March 2017 Gross gaming revenue for the state’s 12 casinos ticked up .1 percent last month or about $360,000, when compared to March of 2016. Revenue clocked in at $289.5 million for the month, according to the Pennsylvania Gaming Control Board. That came after five straight months of YoY decreases at PA casinos, although we’re pretty sure no one is throwing a ticker-tape parade for a flat month. The slight upward shift came from table games, which were up two percent YoY, from $77.9 million to $79.5 million. Slot machines, however, saw another month of declining revenue, as those numbers were released earlier. Winners and losers for PA casinos Casinos were all over the map in March. Revenue was up at both big casinos (SugarHouse, +4.5 percent to $27.7 million) and small ones (Valley Forge, +4.4 percent to $10.5 million; Lady Luck Nemacolin, +4.2 percent to $3.2 million). The biggest winner was Hollywood Casino at Penn National. The mid-state facility saw gaming revenue tick upwards 5.8 percent, or $1.3 million, to $23.3 million. The big two in the state, Sands Bethlehem and Parx, fell in the middle of the pack. Sands had a good month, up three percent ($1.5 million). Parx was relatively flat, down just about $300,000. Mohegan Sun and Presque Isle took the biggest hits, both down about seven percent. Here’s a look at all the casinos for the month: Are changes coming to PA gaming? While casino revenues are flat to declining, the state is in the middle of discussions to change gambling law in the state. Options include legalization of PA online casinos and the authorization of video gaming terminals in private establishments. It seems unlikely the state is going to see improvements to gaming revenue without some sort of changes coming from the legislature. The state government has promised new money to the budget from gaming changes. But, to date, we still have no idea what those changes will encompass.

Contents
1 A look inside the YTD revenue numbers
1.1 Historical look at casino revenue in Pennsylvania
2 Who’s up in PA?
2.1 Parx Casino
2.2 Sands Bethlehem
2.3 Valley Forge Casino Resort
2.4 The Meadows Casino
2.5 SugarHouse Casino
2.6 Harrah’s Philadelphia
2.7 Mount Airy Casino Resort
2.8 Mohegan Sun at Pocono Downs
3 Who’s down in PA?
3.1 Lady Luck Casino Nemacolin
3.2 Rivers Casino
3.3 Presque Isle Downs and Casino
3.4 Hollywood Casino at Penn National Pennsylvania’s 12 land-based casinos posted their best month to date in March. The gains were thanks in large part to a near 12 percent increase in table game revenue compared to March of 2015. Overall the industry’s casino revenue (slots and table games) was up over 4 percent year-over-year. Unlike most other locales, from Connecticut to Atlantic City to Las Vegas, Pennsylvania’s casino industry has thus far avoided the over saturation that has afflicted these other markets. After two consecutive years (2013 and 2014) of trivial revenue declines, Pennsylvania bounced back with a record-setting 2015, and is on pace for a second straight year of record revenue in 2016. Interestingly, and likely not a coincidence, the Pennsylvania Legislature is one of the more proactive when it comes to keeping its casino industry healthy. This is evidenced by the number of reforms it is considering, including online gaming and the addition of VLT’s at designated airports and off-track-betting parlors. These reforms and expansions are designed to further bolster the current operators. A look inside the YTD revenue numbers With revenue on the rise in January, February, and March, the Pennsylvania casino industry is on pace to tally $3.34 billion in CY2016, a number that would shatter last year’s all-time revenue record of $3.17 billion. Here is a look at the year-to-date tally for Pennsylvania’s casinos:
January 2016 GGR: $255,905,078 (+3.6%)
February 2016 GGR: $268,354,231 (+8.6%)
March 2016 GGR: $289,167,505 (+4.2%) Year-over-year, the industry as a whole is up 5.4 percent year-to-date:
2016 gross gaming revenue YTD = $813,426,814
2015 gross gaming revenue YTD = $771,663,075 Historical look at casino revenue in Pennsylvania
2006: $31,567,926
2007: $1,039,030,723
2008: $1,615,565,758
2009: $1,964,570,480
2010: $2,486,408,061 (table games introduced)
2011: $3,024,772,959
2012: $3,158,317,863
2013: $3,113,928,591
2014: $3,069,077,597
2015: $3,173,787,012
2016 [on pace for]: $3,345,171,510 Who’s up in PA? Parx Casino
March 2016 revenue: $49,994,112 (2015: $44,682,526)
YoY change: +11.89% In the race to the top, Parx out-pipped Sands Bethlehem for the sixth consecutive month, and its lead appears to be widening. Falling just short of $50 million in revenue, Parx also posted the largest YoY gain of any of the state’s 12 casinos in March, thanks in large part to an incredible 28 percent increase in table game revenue. Sands Bethlehem
March 2016 revenue: $46,918,830 (2015: $43,344,923)
YoY change: +8.25% Sands Bethlehem had a terrific month, with slot revenue up 4 percent and table game revenue up 15 percent. But even with these gains, they slipped further behind Parx. Valley Forge Casino Resort
March 2016 revenue: $10,031,452 (2015: $9,434,213)
YoY change: +6.33% Valley Forge did it! For the first time in the casino’s history, it eclipsed the $10 million mark in monthly revenue, something I predicted would occur in last month’s column. The “resort” casino (visitors must be staying at the hotel or purchase a yearly membership in order to gamble) achieved $10 million in monthly revenue despite a slight YoY dip in slot revenue, thanks to a 28 percent increase in table game revenue. The Meadows Casino
March 2016 revenue: $22,949,317 (2015: $21,703,239)
YoY change: +5.74% Evidenced by a nearly 6 percent increase in YoY revenue, Meadows Casino continues to make progress in the market. Even though Meadows may only be producing about half as much monthly revenue as Parx and Sands, the casino’s continued growth has allowed it to keep pace with the increasingly crowded trail pack of SugarHouse, Harrah’s, Penn National, Mohegan Sun, and Rivers Casino. SugarHouse Casino
March 2016 revenue: $26,519,098 (2015: $25,461,527)
YoY change: +4.15% With its expansion efforts wrapped up, including the opening of its Poker Night in America poker room, SugarHouse Casino continues to make gains in the market. March saw SugarHouse pass Harrah’s in revenue, and the casino now ranks fourth in the market, behind Parx, Sands, and its sister casino (both are owned by Rush Street Gaming) in Pittsburgh, Rivers. Harrah’s Philadelphia
March 2016 revenue: $26,129,301 (2015: $25,606,034)
YoY change: +2.04% After a poor February (when it was the only casino to post a significant decline), Harrah’s bounced back with a solid March, posting 2 percent YoY growth, largely due to a 20 percent jump in table game revenue. Mount Airy Casino Resort
March 2016 revenue: $16,285,829 (2015: $15,996,923)
YoY change: +1.81% Mount Airy continues to creep up towards the crowded trail pack I alluded to above. Growth slowed to just under 2 percent in March, but growth is growth, and a number of casinos did worse. Mohegan Sun at Pocono Downs
March 2016 revenue: $23,529,527 (2015: $23,346,717)
YoY change: +.78% Compared to March of 2015, March of 2016 was basically a wash for Mohegan Sun at Pocono Downs, as table game revenue bucked the industry trend (Mohegan’s table game revenue was down 20 percent), but this was offset by a 5 percent gain in slot revenue. Who’s down in PA? Lady Luck Casino Nemacolin
March 2016 revenue: $3,037,311 (21015: $3,048,461)
YoY change: -.37% Lady Luck remains an also-ran in the PA casino industry, hovering around the $3 million mark in monthly revenue after March revenue remained largely unchanged YoY. Rivers Casino
March 2016 revenue: $30,241,006 (2015: $30,460,711)
YoY change: -0.72% Rivers’ revenue remained pretty much unchanged in March, as it posted another $30 million month. Still, the casino continues to be the closest competitor to Parx and Sands. Presque Isle Downs and Casino
March 2016 revenue: $11,517,348 (2015: $11,806,003)
YoY change: -2.44% After a terrific February, Presque Isle fell back to earth in March… and then some. In February, the small casino was the top gainer when it came to percentage YoY growth, but it gave a little of that back in March, posting a near 2.5 percent YoY decrease. Hollywood Casino at Penn National
March 2016 revenue: $22,014,374 (2015: $22,591,559)
YoY change: -2.55% After a second consecutive month that can best be classified as the casino underperforming, Hollywood Casino continues to slip to the back of the Pennsylvania casino market. If the current trends continue, it could find itself falling out of the trail pack in the not-so-distant future.

Contents
1 The August numbers
2 A look inside the YTD revenue numbers
2.1 Historical look at casino revenue in Pennsylvania
3 A casino by casino look at the numbers
3.1 Sands Bethlehem
3.2 Parx Casino
3.3 SugarHouse Casino
3.4 Rivers Casino
3.5 Harrah’s Philadelphia
3.6 Mohegan Sun at Pocono Downs
3.7 Mount Airy Casino Resort
3.8 Valley Forge Casino Resort
3.9 The Meadows Casino
3.10 Presque Isle Downs and Casino
3.11 Hollywood Casino at Penn National
3.12 Lady Luck Casino Nemacolin Any way you slice it, Pennsylvania’s casino industry had a dismal August. Revenues were down almost across the board: Table games, slots, individual operators, year-over-year, and month-over-month. Adding insult to injury, the August decline put an end to a nearly year-long streak of growth. From September 2015 to May 2016, Pennsylvania’s casino industry posted year-over-year revenue gains each and every month. The streak came to a semi-halt in June, after the industry posted a microscopic decline of .02 percent. July saw revenues back in the black, with revenue growth of 2.95 percent. And then August happened. If you’re looking for a silver lining, the declining revenue may help push a gambling expansion bill across the finish line. The latest numbers show the Pennsylvania casino industry isn’t immune to the cannibalization and receding revenue other jurisdictions are seeing. The bill would, among other things, legalize PA online casinos and daily fantasy sports, and make some structural changes to Category 3 license holders that would allow them to increase their land-based gambling footprint. The August numbers The August revenue reports issued by the Pennsylvania Gaming Control Board puts total casino revenue at $260,904,471 in August. Table game revenue was down 3.7 percent YoY. Slot revenue was down 4.5 percent. Eleven of the state’s 12 casinos saw revenue decline YoY (the only exception was SugarHouse Casino). Only a single casino, Valley Forge, posted a YoY increase in slot handle.
August 2016 slot machine revenue: $193,949,366.66 (-4.47%)
August 2016 table game revenue: $66,955,105 (-3.73%) A look inside the YTD revenue numbers Here is a look at the monthly year-to-date revenue tally for Pennsylvania’s casinos:
January 2016 GGR -$255,905,078 (+3.6%)
February 2016 GGR – $268,354,231 (+8.6%)
March 2016 GGR – $289,167,505 (+4.2%)
April 2016 GGR – $281,206,497 (+3.9%)
May 2016 GGR – $280,194,999 (+.80%)
June 2016 GGR – $258,423,105 (-0.2%)
July 2016 GGR – $288,451,402 (+2.95%)
August 2016 GGR – $260,904,471 (-4.28%) Historical look at casino revenue in Pennsylvania Despite the August setback, Pennsylvania is still on pace to have its best year to date. The previous high-water mark was set last year when the state’s casinos tallied $3.17 billion.
2006: $31,567,926
2007: $1,039,030,723
2008: $1,615,565,758
2009: $1,964,570,480
2010: $2,486,408,061 (table games introduced)
2011: $3,024,772,959
2012: $3,158,317,863
2013: $3,113,928,591
2014: $3,069,077,597
2015: $3,173,787,012 A casino by casino look at the numbers Sands Bethlehem
Slot revenue, June 2016: $24,788,628.16 (-2.8%)
Table game revenue, June 2016: $19,334,469 (-1.02%) Even though Sands Bethlehem experienced only modest declines in slot and table game revenue during one of the worst months in recent history, it was still enough to cede its tenuous position as the top revenue generating casino in Pennsylvania back to Parx. As noted above, online gambling could soon be legalized in Pennsylvania. If the state does legalize online gambling Sands is expected to forego launching an online gambling site. That would likely mean Parx will be able to cement its place as the top revenue-generating casino in the state with the addition of a new revenue stream. Parx Casino
Slot revenue, June 2016: $31,988,404.99 (-.28%)
Table game revenue, June 2016: $12,938,984 (+.71%) Parx not only eclipsed its rival Sands Bethlehem, but the casino managed to buck the downward trend, as revenue was virtually flat year-over-year. SugarHouse Casino
Slot revenue, June 2016: $14,030,492.80 (-.18%)
Table game revenue, June 2016: $8,509,687 (+21.94%) SugarHouse has been on a tear of late (thanks to a massive expansion project that the property wrapped up earlier this year). August was far from the property’s best month during this run from a numbers perspective. However, it could very well be its best month, considering SugarHouse was the only casino to post YoY gains in August. Table games continue to be where SugarHouse hangs its hat, as the casino has clearly separated itself from all of the state’s casinos not named Parx and Sands when it comes to monthly table game revenue. Rivers Casino
Slot revenue, June 2016: $21,884,335.87 (-7.66%)
Table game revenue, June 2016: $5,404,034 (-17.59%) The Pittsburgh-based Rivers Casino continues to be the third-highest grossing casino in the state. Unlike its sister casino in Philadelphia, SugarHouse, (both properties are owned by Rush Street Gaming) Rivers is going in the wrong direction. Rivers was down nearly 10 percent YoY, with both slot and table game revenues undergoing a significant decline. Harrah’s Philadelphia
Slot revenue, June 2016: $16,265,982.01 (-8.99%)
Table game revenue, June 2016: $5,757,736 (+10.25%) All in all, August wasn’t too bad for Harrah’s, which is doubly important considering Harrah’s has been bearing the brunt of nearby SugarHouse’s gains. Revenues slipped less than five percent YoY, and Harrah’s continues to run neck-and-neck with SugarHouse for the No. 4 spot on the state’s monthly revenue list. Mohegan Sun at Pocono Downs
Slot revenue, June 2016: $17,899,498.69 (-6.18%)
Table game revenue, June 2016: $3,002,410 (-17.61%) Mohegan Sun had a similar month to Rivers, as there’s little positive news for the casino in this month’s revenue reports. Mount Airy Casino Resort
Slot revenue, June 2016: $12,385,625.81 (-6.06%)
Table game revenue, June 2016: $3,283,432 (-29.24%) Once again, table game revenue at Mount Airy fell off a cliff. This trend has been going on for three months now, with table game revenue down 17 percent in June, 12 percent in July, and a whopping 29 percent in August. Mount Airy was one of two casinos (Meadows being the other) that experienced a double digit decline in YoY revenue. Valley Forge Casino Resort
Slot revenue, June 2016: $6,526,640.14 (+2.89%)
Table game revenue, June 2016: $2,792,677 (-8.14%) Valley Forge is one of the few casinos that will likely be content with its August numbers. Revenue was virtually flat at the small casino, with a slight uptick in slot revenue offsetting the casino’s declining table game revenue. In fact, Valley Forge was the only Pennsylvania casino that saw slot revenue increase YoY in August. The Meadows Casino
Slot revenue, June 2016: $18,323,551.37 (-5.7%)
Table game revenue, June 2016: $1,625,299 (-46.77%) Table game revenue was down significantly at a number of casinos in August, but nowhere near the drop-off Meadows saw. The nearly 50 percent drop in slot revenue YoY might be explained by a significant jackpot being hit. Also of note, the PGCB recently approved the conversion of Meadows operator license from Washington Trotting Association to Pinnacle Entertainment. Pinnacle will take over day to day operation of the property, with WTA leasing the property to them. Presque Isle Downs and Casino
Slot revenue, June 2016: $10,217,083.27 (-4.34%)
Table game revenue, June 2016: $1,167,941 (+11.59%) Like most Pennsylvania casinos, Presque Isle saw its slot revenue drop significantly. Unlike most of the other casinos, Presque Isle was able to mitigate the slot decline with solid table game revenue numbers. Hollywood Casino at Penn National
Slot revenue, June 2016: $16,976,162.84 (-7.06%)
Table game revenue, June 2016: $2,786,057 (+12.16%) Even a 12 percent increase in table game revenue was unable to put much of a dent in the declining slot revenue at Hollywood Casino of over seven percent — the third worst in the state in August. Overall, revenue dipped nearly five percent YoY for the storied racetrack and casino. Lady Luck Casino Nemacolin
Slot revenue, June 2016: $2,662,960.71 (-5.95%)
Table game revenue, June 2016: $352,378 (-29.91%) Lady Luck is on the verge of falling below the $3 million mark in monthly revenue. The casino’s revenues often fluctuate due to its size and volume of play (making it a victim of variance) but Lady Luck’s table games and slot revenues took a bath in August.

Coming off a record-setting month in March, the Pennsylvania casino industry showed no signs of slowing down in April. Total casino revenue was up nearly 4% for the month per the monthly revenue reports issued by the Pennsylvania Gaming Control Board. April’s gains were largely on the back of table game revenue, which rose over 11 percent year-over-year. Slot revenue also rose YoY, but only by a modest amount compared to table games — 1.5 percent. Overall, there weren’t any big gains or losses by the individual operators (the largest YoY increase was just over nine percent, while the largest decline was just over two percent), with most of the state’s 12 casinos posting small gains or losses. With revenue continuing to rise, Pennsylvania is proving to be the exception to the rule in the U.S. casino market. The state is on an upward trajectory, and heading towards its best year to date. Meanwhile the legislature is still mulling over a bill that would further strengthen the industry and increase revenue numbers. The measure being considered, HB 649, would among other things, allow video lottery terminals at select locations and authorize PA online casinos. A look inside the YTD revenue numbers April marks the eighth consecutive month the Pennsylvania casino industry posted year-over-year gains, and as noted above, the industry is on its way to its best year to date. Here is a look at the year-to-date tally for Pennsylvania’s casinos:
January 2016 gross gaming revenue – $255,905,078 (+3.6%)
February 2016 GGR – $268,354,231 (+8.6%)
March 2016 GGR – $289,167,505 (+4.2%)
April 2016 GGR – $281,206,497 (+3.9%) Year-over-year, the industry as a whole is up 4.8% year-to-date:
2016 gross gaming revenue YTD = $1,094,633,311
2015 gross gaming revenue YTD = $1,042,241,985 Historical look at casino revenue in Pennsylvania
2006: $31,567,926
2007: $1,039,030,723
2008: $1,615,565,758
2009: $1,964,570,480
2010: $2,486,408,061 (table games introduced)
2011: $3,024,772,959
2012: $3,158,317,863
2013: $3,113,928,591
2014: $3,069,077,597
2015: $3,173,787,012
2016 [on pace for]: $3,326,128,788 Who’s up in PA Parx Casino March 2016 revenue: $48,531,262 (2015: $44,452,844)
YoY change +9.17 Parx had the best month of any Pennsylvania casino. The casino not only generated more revenue than any of its competitors, it also posted the largest year-over-year gain, 9.17 percent, and extended its lead over the No. 2 casino in the state, Sands Bethlehem. Parx has topped the state’s revenue charts for seven consecutive months and beat Sands by 10% in April. SugarHouse Casino
March 2016 revenue: $26,299,934 (2015: $24,127,134)
YoY change +9.01% SugarHouse Casino has been one of the industry’s real success stories. The casino has gone from being in the bottom of the trail pack that is perpetually chasing Parx and Sands, to nearly leading it. In April the casino saw its revenue rise over nine percent, and this trend could continue for quite some time, considering SugarHouse just recently put the finishing touches on a massive expansion project. The Meadows Casino
March 2016 revenue: $22,095,921 (2015: $20,283,534)
YoY change +8.94% Meadows followed up an impressive March, with an even more impressive April. After seeing GGR increase some six percent in March the casino posted a nine percent increase in April. Meadows slot revenue was up nearly five percent for the month, the highest percentage increase of any operator in the state. Yet this pales in comparison to its table game revenue increasing an astounding 48%, also the highest percentage increase in the state. Mount Airy Casino Resort
March 2016 revenue: $15,862,020 (2015: $15,157,092)
YoY change +4.65% Mount Airy‘s ascent in the Pennsylvania casino hierarchy continued in April. The casino is proving it can compete in the market despite the restrictions imposed on it by its category 3 resort casino license. Mohegan Sun at Pocono Downs
March 2016 revenue: $23,461,903 (2015: $22,619,834)
YoY change +3.72% Mohegan Sun had a strong showing in April, with GGR up nearly four percent for the month. Most of the gains came from a nearly 14 percent increase in table game revenue, although slot revenue was also up, but by less than two percent. Mohegan Sun is now on the verge of overtaking Harrah’s, a potential achievement that seemed unlikely just a year ago. Sands Bethlehem
March 2016 revenue: $43,877,133 (2015: $42,920,508)
YoY change +2.23% Sands Bethlehem posted modest gains in April, which wasn’t enough to keep the casino from losing even more ground to Parx. What used to be a two-horse-race to be the top revenue generator in the state (a race often won by Sands) has turned into a case of a clear cut No. 1, Parx, and a No. 1a, Sands Bethlehem. Rivers Casino
March 2016 revenue: $30,574,515 (2015: $30,016,628)
YoY change +1.86% Rivers remains one of the more consistent performers in the market, evidenced by its uncanny ability to generate about $30 million in total GGR each and every month. This is something Rivers accomplished in March of 2015 and 2016, as well as in April of 2015 and 2016. Presque Isle Downs and Casino
March 2016 revenue: $11,451,714 (2015: $11,268,063)
YoY change +1.63% Presque Isle Downs had an April like many of its competitors: fairly nondescript. Presque Isle’s slot revenue was static in April, but it did see a nice increase, 14 percent, in table game revenue YoY. Lady Luck Casino Nemacolin
March2016 revenue: $3,111,694 (21015: $3,065,834)
YoY change +1.50% Lady Luck continues to lag behind the rest of the Pennsylvania casino industry, posting just over $3 million in revenue for the month, which means Lady Luck accounts for a mere one percent of the state’s monthly revenue tally. On a positive note, the small casino has been consistently hovering around the $3 million mark and may have simply settled into its place in the market. Who’s down in PA Hollywood Casino at Penn National
March 2016 revenue: $22,027,271 (2015: $22,068,278)
YoY change -.19% April was a relatively stagnant month for Hollywood Casino. The casino’s table game and slot revenue were both down incrementally, but were basically a wash. Harrah’s Philadelphia
March 2016 revenue: $24,218,245 (2015: $24,703,433)
YoY change -1.97% Harrah’s Philadelphia appears to be the victim of SugarHouse’s success, as the two casinos are relatively close to one another. Following the completion of SugarHouse’s expansion project, Harrah’s revenue has been consistently ticking down. If this trend continues, Harrah’s could find itself at the bottom of the trail pack in the near future. Valley Forge Casino Resort
March 2016 revenue: $9,694,886 (2015: $9,894,730)
YoY change -2.02% After bursting through the $10 million mark for the first time in the casino’s history, Valley Forge saw its monthly revenue dip back under $10 million in April. More troubling for the Category 3 resort casino is that revenue fell just over two percent YoY. This occurred on the heels of Valley Forge’s strong March, when the casino posted six percent growth.

After both Pennsylvania and New York have taken their time in recent years considering the legalization of online poker, it’s possible there will now be a sprint to the finish for the two states. What’s going on in Pennsylvania online poker? The conversation on online poker in Pennsylvania’s legislature appears to be on hiatus, although an online gambling bill is also not entirely off the table in the state’s ongoing budget battle. The bill’s sponsor, Rep. John Payne, has indicated previously that the gambling expansion bill that includes regulation and legalization of online casinos and poker would be taken up in the spring. He also predicted that it would be passed in July. There has been optimistic talk from Payne on online gambling in the past, but it does appear like it will get serious consideration in 2016. Part of the reason it will get more momentum? Its neighbor to the north is looking into online poker, too. What’s going on in New York online poker? New York held an informational hearing about online poker in September, but ever since, the topic has been off the table in the Empire State. That all changed in recent weeks, as Assemblyman J. Gary Pretlow, head of the Assembly Committee on Racing and Wagering, introduced a bill that would legalize and regulate online poker in the state. Then, last week, a Senate version of the online poker bill made it onto the agenda of a committee hearing set for Feb. 2. While New York has been considering online gaming regulation for several years, legislation has never gotten very far. How serious this effort is remains to be seen, but the quick turn of events suggest that the online poker will get serious consideration in 2016. Who gets online gambling passed first? First off, it wouldn’t be a surprise if neither state passed online gambling legislation. (It’s important to note that Pennsylvania’s bill encompasses all online gaming, while New York is for poker only.) At the same time, as both states are considering regulation, there is value in being first to pass a bill, so they have a leg up on offering it in their respective state. There’s even a possibility that both states could see the value in passing legislation and entering into an interstate online poker compact that already includes Nevada and Delaware, and that would welcome New Jersey, should it choose to join. Pennsylvania has done far more public legwork on the online gambling question, and legislation has already seen meaningful progress, making it out of committee. Right now, Pennsylvania would have to get the edge for crossing the finish line first. Of course, the recent New York effort came nearly out of nowhere. If work has been done behind the scenes by the bills’ sponsors, then all bets are off, and online poker could get passed quickly in New York. We’ll get a better sense of just how serious New York is about online poker this week.

On Wednesday the Pennsylvania Senate Community, Economic, and Recreational Development Committee hosted a hearing that discussed, among other things, the legislature’s current efforts to expand into online gambling. The hearing featured a number of witnesses from the Pennsylvania Gaming Control Board (PGCB), who hit on topics ranging from regulations and safeguards, to problem gambling and the health of the state’s horse racing industry. Wednesday’s hearing occurred just a week after the state’s casino stakeholders appeared in front of the Pennsylvania Senate CERD Committee to talk online gaming expansion and gaming reforms. Both hearings provided positive momentum for online gaming expansion in the Keystone State, but there are still quite a few wrinkles that will need to be ironed out if iGaming is going to become a component of the state’s budget. That budget that is due in just 14 days, although there seems to be wiggle room for an extension. Regulators unafraid of online gambling The key takeaway from Wednesday’s hearing? The Pennsylvania Gaming Control Board is ready, willing, and able to tackle online gambling. PGCB Executive Director Kevin O’Toole was the first witness to tout the PGCB’s capabilities and willingness to take on this oversight role. “The Board is confident [Internet gambling] can be regulated,” O’Toole stated. The PGCB has “experienced and capable regulators,” O’Toole told the committee, adding that the board would be ready to regulate Internet gaming in an efficient and controlled manner if and when it’s legalized. According to O’Toole, the PGCB could have regulations drafted, licenses handed out, and the sites online within nine to twelve months of the legislature passing an online gambling bill. O’Toole qualified this aggressive timeline by saying it was dependent on the speed of the license application process. Another witness, Michael Cruz, the Chief Technology Officer of the PGCB, said the state would draw heavily on New Jersey’s experiences. “I’m not interested in reinventing the wheel,” Cruz told the committee. Cruz added that Pennsylvania regulators would look towards the New Jersey model in drafting Pennsylvania’s regulations. What are the remaining issues? Unlike California, the policy differences among Pennsylvania’s potential iGaming stakeholders don’t seem as hard-line. In-person registrations and whether Category 3 casinos should be allowed to apply for an online gambling license appear solvable. The pricklier issues seem to be differences between the state’s casinos and the legislature when it comes to an acceptable tax rate. The casinos and most iGaming advocates would like to see the tax rate set around 14% (the rate in Representative John Payne’s HB 649) while the recently introduced Senate gaming bill sponsored by Senator Kim Ward, SB 900, calls for a 54% tax rate on online gambling. However, these are merely the iGaming issues the state is wrestling with. The senate is trying to pass a comprehensive gaming reform bill, not a standalone online gambling bill. It’s the policies in the other sections of SB 900 that seem far more contentious. Liquor, Category 3 restrictions, and OTB’s are the REAL issues The issues that could sideline the bill (including online gambling) appear to be the following proposed brick-and-mortar gambling reforms:
Loosening restrictions on Category 3 license holders – specifically, the requirement that casino players must be guests or “members” of the casino.
Increasing the number of off-track betting locations (and slot machines at these locations) in Pennsylvania.
Making liquor available 24/7 at casinos. Category 3 Under SB 900, for a one-time $5 million fee, the state’s two Category 3 casinos would be able to do away with their “membership” requirements. Category 3 casinos are in favor of this proposal, while virtually every other casino is opposed to it. The strength of opposition seems contingent on the proximity to the Category 3 casino. This provision would not allow Category 3 license holders to add more slots or table games. Currently Category 1 and 2 casinos are permitted 5,000 slot machines and 250 table games, while Category 3 casinos are permitted 600 slot machines and 50 table games. OTB locations Another provision in SB 900 would allow casinos (this appears only to apply to racinos) to open multiple OTB parlors and place slot machines at them. Each OTB (there could be as many as 32) would cost $5 million with the slot revenue taxed at 54%. Category 1 racinos are all for this expansion effort, while Category 2 casinos (most notably SugarHouse Casino) are opposed to this type of expansion. Liquor around the clock The final sticking point is a provision that would allow casinos to serve liquor around the clock, which once again calls for a $5 million permit fee. Every casino is in favor of increasing the number of hours they are allowed to serve liquor, so this issue will pit legislator against legislator, as many are opposed to increasing the number of hours casinos can serve liquor. Upshot For the bill to move forward, these three non-Internet gaming issues (which seem far more contentious and far more difficult to solve) need to be addressed or scrapped. Alternatively, iGaming could be separated from the other parts of SB 900 and added to the budget. Pennsylvania’s iGaming future may very well hinge on his happening. Photo by Bestbudbrian used under license CC BY-SA 3.0.