Pennsylvania Is The New California And California Is The New Mississippi

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If the recently concluded C5 Online Gaming Conference in New York City is any indication, the next state to pass online gaming legislation will be Pennsylvania. Speakers at gaming conferences tend to paint the industry in a positive light and offer cheerful outlooks for gaming going forward. C5 was no exception to this rule. However, this positive spin is often generalized and spoken about in abstract terms, as few of the industry’s analysts and consultants are willing to make steadfast declarations on the ever-changing gaming landscape. And the other group of conference attendees – politicians and regulators – are masters at deflecting questions and leaving the door open for all possibilities. There was one exception at C5, and that was Pennsylvania’s chances of passing an online gaming bill in 2015. an issue several panelists seemed willing to discuss and bullish about. No need to parse these comments One panelist, former New Jersey Division of Gaming Enforcement and New Jersey Casino Control Commission member and current Amaya Gaming Chairman of Compliance, Thomas Auriemma, went so far as to say it is “likely” Pennsylvania will pass a bill in 2015, and that the Pennsylvania bill “will move” this year. Auriemma’s comments should be given a lot of credence, as his previous positions in New Jersey have given him intimate knowledge of the dynamics in Pennsylvania, as well as the principles involved. An online gaming bill would likely be part of the state’s budget, which is due to be passed in June. This leaves precious little time to get the ball rolling in the legislature. However, as Auriemma noted, budgets don’t have to pass on time (nor do they). So we shouldn’t consider June a hard deadline for an online gaming bill in Pennsylvania, although he also indicated that it could be passed by June. Another panelist suggested that with the continued turmoil in California, all eyes should be turned to the Keystone State. Throughout the day, whenever Pennsylvania’s progress was broached by a panel there were many nods of agreement from other panelists and audience members. These sentiments were also espoused in private conversations. Steady online gambling regulation progress in PA Unlike California, where online gaming expansion has been on the table for at least five years with little progress made, Pennsylvania is currently on a trajectory similar to New Jersey in 2012 and 2013. What I refer to as the three year plan:
Year 1: The issue becomes a topic of discussion and a bill may or may not be introduced.
Year 2: Legislation is introduced and hearings are held but the bill dies in the legislature.
Year 3: Legislation is reintroduced, more hearings are held and the measure is passed. Pennsylvania is currently in year three. Momentum is clearly on PA’s side Not only is Pennsylvania in year three of online gaming talks, but several factors have accelerated the online gaming expansion process in Pennsylvania. A new GO Committee Chairman John Payne, a pro-online gambling legislator, took over control of the all-important House Gaming Oversight Committee. His predecessor, Mauree Gingrich, was extremely leery of online gaming expansion, telling local press in 2013 that online gambling was not a priority, nor was it on the legislature’s radar. When Payne was given the Chairmanship of the GO Committee, he outlined his goals thusly: “I view this new responsibility as a chance not only to ensure integrity in the industry, but explore opportunities for expansion and reform that could generate additional revenue for our economy.” Earlier this year I spoke with Chairman Payne and he reiterated his commitment to keep Pennsylvania gaming healthy and competitive, saying, “My mission statement is to keep gaming in general healthy, but in particular to make sure our casinos stay healthy and competitive against our surrounding states.” “The thing I don’t want to see happen is four casinos in Pennsylvania close like happened in Atlantic City. […] “For me, I’d rather have Internet gambling, fantasy sports betting, fix the small games of chance bill [bar machines], than vote to raise income or sales taxes,” Payne said. Bipartisan support Payne also has a willing partner on the opposite side of the aisle, as Democrat Nick Kotik (the Democratic Chair of the GO Committee) has cosponsored Payne’s online gaming bill, HB 649. Hearings, and hearings, and more hearings With Payne at the helm, Pennsylvania has hosted half a dozen (and counting) hearings on online gaming expansion. Aside from Las Vegas Sands representatives, there appears to be a strong appetite among Pennsylvania’s gaming interests and lawmakers, who not only are hosting hearings, but dressed-down Las Vegas Sands rep Andy Abboud and his demagoguery of online gaming. They also passed HR 140, a resolution urging Congress not to pass RAWA. May I have this dance? Finally, several of Pennsylvania’s brick and mortar casinos have entered into partnerships with online operators. This is a particularly strong indicator that positive steps are being made, as the same situation occurred in New Jersey prior to the bill being passed, here and here.

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