Pennsylvania Regulators Ready for Online Poker

After two weeks of hearings discussing the overall gambling industry of Pennsylvania, regulators are ready to begin the work to legalize online gaming within the state. The most recent hearing to take place was with the Community, Economic & Recreational Development Committee, which is chaired by Kim Ward, a Senator of the state who recently proposed an online gaming bill. The hearing took into account several factors involving gaming, including online poker gaming.

Kevin O TooleKevin O’Toole is the Pennsylvania Gaming Control Board director how spoke during the recent hearing. The Director was in high praise for the success of gaming in Pennsylvania since the Gaming Act was created in 2004. With the Gaming Act, the state was able to offer land based gaming with legalization and regulation. By this year, gaming revenue should reach the billions, as much as $3 billion for the 4th consecutive fiscal year.

O’Toole stated that the gaming industry within the state is beginning to reach a stabilized period. He believes it is safe to say that the industry will not be seeing an explosion in growth of year’s previous but will also not see a decline in gaming revenues.

In regards to online gaming, O’Toole discussed two items of legislation that were recently proposed. Both SB 700 and SB 900 were introduced by Ward and other committee members for the introduction of online poker within the state. O’Toole wants to see a five year licensing renewal period created within the state instead of the 3 year period in the proposed legislation. With the increase in time frame, O’Toole believes the cost will be lessened without sacrificing oversight. It seems legislators have listened since SB 900 has changed the time frame for licensing to 5 years.

Also on the table for discussion was the option for Pennsylvania to operate outside the state. Legislators are interested in entering into agreements with other states for online gaming player liquidity. States that currently offer online gaming, Delaware/Nevada/New Jersey, all have the option to operate in other states. Both Nevada and Delaware have already signed an agreement and are currently sharing player pools when it comes to online poker gaming.

Hot topics of opponents of online gambling were also discussed during the hearing. One topic that is always up for discussion is underage gaming. O’Toole understands that not all security measures are foolproof especially when it comes to underage gaming. There will always be a parent that is not parenting or a sophisticated person who wants to work around the system. However, O’Toole believes that the features in place with Delaware, Nevada and New Jersey gaming seems to be working to keep young children from gaming online.

Perhaps the portion of legislation that is a point of contention is the tax rates. With SB 900, the bill would see revenues of online gaming taxed at 54%. This rate is higher than 15% wanted by casino operators who state that the high percentage will put the casinos out of contention with neighboring state’s casinos.

John Payne’s bill HB 649 has a tax rate of 14% which is much lower than SB 900 proposed rate. Other legislator wants to make sure that the tax rate is correct so that gaming at online casinos will not hurt land based revenues, which could happen if online options offers lower tax rates.

Overall, the hearing was a success to push forward with talks of online poker gaming within the state. Only time will tell if legislation is passed in time to move forward and make Pennsylvania the next state to offer online gaming within the United States.