Online Poker Still On Table In PennsylvaniaLawmakers Waiting, Working On Budget Agreement |
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Efforts to legalize and regulate online poker in Pennsylvania are still very much alive, State Rep. John Payne (R-Dauphin County), author of one of several I-gaming bills in the Keystone State, told Card Player on Friday.
“Nothing is further from the truth,” Payne said of speculation that the window is closing on online gaming legalization in 2015.
Payne said that until there’s a budget agreement “nobody knows” what exactly will happen with his and other gaming expansion bills on the table, which include other ideas to beef up the state’s gaming industry, such as slots at airports.
One of the concerns with online gaming proposals in Pennsylvania this year has been the tax rate. One of the leading online gaming proposals set a tax rate of 54 percent. That’s much higher than Nevada’s just under seven percent and New Jersey’s approximately 18 percent, but also higher than Delaware’s roughly 45-percent rate. Payne’s online gaming bill set the tax rate below 15 percent, while another proposal put forth a rate less than 30 percent. There’s varying opinions even within the Keystone State’s legislature about how to do I-gaming and what it should give the state.
“I think [54 percent] is the high end,” Payne said. “If 14 percent is too low, I am willing to negotiate.” Again, he said, it depends on what the state determines it needs for its budget.
Nevada, New Jersey and Delaware are currently the only states in the country with online gaming industries, though a handful of other states have lotteries that offer online services.
Pennsylvania concluded in a past study that regulated online poker could be worth up to $129 million annually once it reaches maturation. It also found that house-banked online casino games could reach $178 million annually under the same conditions. Those revenues would add roughly 10 percent to the state’s brick-and-mortar casino gambling market, worth around $3 billion annually. Pennsylvania gaming revenues haven’t grown for the past two years.
Pennsylvania is the second-largest commercial casino market in the country behind Nevada. Silver State casinos take in a little more than $11 billion a year from gamblers. Then there are tribal gaming markets, like the one in California worth more than $7 billion a year. Tribal gaming made up roughly 43 percent of the overall casino gaming market in America in 2014. California is also looking at regulated online poker, but efforts there, far less advanced than the progress in Pennsylvania, are likely dead for this year.
Nevada doesn’t separate online poker revenue from live poker revenue since there is essentially only one web poker operator, so all we know is that Silver State poker was $15.84 million in June overall. New Jersey does provide figures for online poker and the other online casino games. In June, New Jersey online poker saw $1.83 million in revenue, while the other games brought in $9.83 million. Delaware online poker revenue was just $30,675 in June, compared to roughly $78,000 for the other online games. Nevada and Delaware share liquidity for online poker.
Out of the three, the only state that was very interested in predicting online gaming revenue before it had an industry was New Jersey, probably because it was touted as a way to save struggling Atlantic City. Estimates a couple of years ago for year no. 1 of online gaming ranged from just over $200 million to more than $1 billion. When the results were in, New Jersey online gaming yielded about $125 million last year. The good news is that year-to-date online gaming revenue in New Jersey is up 14.2 percent (but not thanks to I-poker).
The wide range for New Jersey likely has caused estimates for Pennsylvania to be more measured.
Payne pointed out that one year the budget wasn’t set until October, so online gaming legalization could be on the table for a couple more months in Pennsylvania.
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