Online Gambling Bill Introduced in Pennsylvania

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Pennsylvania State Representative John Payne (R – Dauphin) has introduced a bill that would legalize and regulate online gambling in the Keystone State. The bill, HB 649, already has support, sponsored by sixteen Representatives in addition to Payne.

While HB 649 has been entered on the Pennsylvania General Assembly’s website, the complete text of the bill has yet to be uploaded. Payne did send a memo to all House members two weeks ago, though, to inform them of his imminent bill introduction and to reveal a few details. Here are the relevant portions of the memo:

In the near future, I plan on introducing legislation that would authorize Interactive Gaming in Pennsylvania.  A recent study from the Legislative Budget and Finance Committee found that Internet Gaming is a large new source of revenue from which the Commonwealth could benefit.

Developments in technology and recent legal decisions have created an opportunity to legalize interactive gaming as a means to further enhance and complement the benefits delivered by casino gaming, licensed facilities and the communities in which they operate. [I-]Gaming has already been authorized in nearby states that directly compete with our current licensed casinos. Many Pennsylvania residents participate in illegal and unregulated gaming sites. Establishing a strong regulatory framework under the Gaming Control Board will assist in shutting down these illegal sites and enhance consumer protection for our gaming residents.

Specifically my bill will do the following:

•    Require all internet gaming to be conducted under the current gaming licensees.
•    Require a licensing fee of $5 million per license.
•    Tax all gross interactive gaming revenue at 14%

The states Payne referred to in his letter are Delaware and New Jersey, located directly next door to the Commonwealth. Atlantic City, a popular (yet declining) east coast gambling destination, is just an hour’s drive away from Pennsylvania. Part of Atlantic City’s problem in recent years has been the rise of brick-and-mortar casinos in neighboring states, particularly Pennsylvania and Maryland, who now have major resort-style casinos that attract gamblers that may have otherwise gone to Atlantic City in the past.

With the rise of internet gambling in Delaware and New Jersey, Pennsylvania is now feeling the pressure of possibly legalizing online gaming itself. Now gamblers who might have traveled from New Jersey to Pennsylvania may literally stay home literally and play, since they can do so from the comfort of their couches (AND IN THEIR UNDERWEAR, RIGHT?). Gambling rivalries are growing in the Mid-Atlantic; it was only a matter of time before a bill was introduced in Pennsylvania.

Pennsylvania is probably one of the few states that could sustain an online poker economy on its own, without combining player pools with other states. With an estimated 12.8 million residents, it ranks as the sixth largest state in the country. Though New Jersey’s year-old online gambling industry has not been as big of a boon to the state’s economy as expected, it is still sustaining itself fairly well and the state has about 4 million fewer residents than Pennsylvania.

Not surprisingly, Payne introduced the bill into the House Gaming Oversight Committee, of which he is the chairman.

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