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Internet Gambling Bill Introduced in Pennsylvania

Pennsylvania State Representative Tina Davis introduced a bill to legislative committee on Monday that would legalize online gambling within the commonwealth.

Spearheaded by Davis, House Bill 1235 is co-sponsored by eleven other Pennsylvania legislators including Thomas Caltagirone, Rosita Youngblood, Dom Costa, William Kortz, Vanessa Lowery Brown, RoseMarie Swanger, Mark Cohen, Ed Neilson, George Dunbar, John Galloway and John Sabatina.

If approved by the House Gaming Oversight Committee, it will then be heard and voted on by the Pennsylvania House of Representatives.

HB 1235 favors existing land-based casinos offering those with existing slot-machine licenses to apply for Internet gaming licenses. The bill will be not limited to online poker; the bill defines “Internet Game” as “table game, slot machine, or any other game approved by the regulation of Pennsylvania Gaming Control Board to be suitable for the use of Internet gaming activities.” The bill does, however, restrict lottery games, bingo, keno and “small games of chance.”

The bill also says that both the licensed entity along with the player must maintain a physical presence in Pennsylvania, with players required to establish online accounts in person at a licensee’s land-based gaming facility. Online players would have to hold an “active players' club membership, which was applied for and issued at the slot machine licensee’s licensed facility.”

Davis originally proposed a bill much different from what was presented to the legislative committee. Among the more notable changes was lowering the one-time licensing fee from $16.5 million to just $5 million and reducing the taxable rate on gross gaming revenue from 45 percent to 28 percent. Other stipulations to the bill read that licenses would be valid for three-year terms and cost $500,000 to renew and would be approved or rejected within 90 days of receipt.

While the bill explicitly speaks to regulating intrastate gambling, Pennsylvania would not be opposed to considering interstate compacts with other states, such as Nevada, in the future.

In discussing the topic early last month, Davis eagerly explained, “If we do not protect our casinos and money in Pennsylvania, we will be hurt by all the competition.”

The urgency of pushing online gaming forward stemmed from Pennsylvania recognizing the need to evolve and enter the online gaming industry as a highly successful brick-and-mortar casino state. Pennsylvania trails Nevada in casino revenue, but is ahead of New Jersey and Delaware, both of which have legalized online gaming.

In addition to the benefits associated with tax revenues and licensing fees to be received by the state, Davis expects that online gaming would create thousands of new jobs for the state and prevent players from dipping into the pool of New Jersey and Delaware.

According to CalvinAyre.com, as stated by HB 1235, the state plans to use 55 percent of the taxes it collects to reduce property taxes for the elderly and an additional 30 percent for providing free or reduced transit for the elderly. The remaining 15 percent would go to the Pennsylvania Race Horse Development.

Republican State Representative Paul Clymer still remains pessimistic on the issue and intends to introduce his own bill to make online gambling illegal.

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