Gaming in Pennsylvania

By Wendy Lewis , Senior Budget Analyst | 11 months ago

 

 

 

 

 

 

 

 

 

Category 4 Casino Auction Results as of August 2021
Casino County Final Location Auction Date Bid Amount
Hollywood York Springettsbury Township, York Galleria Mall 1/10/2018 $50,100,000
Live Westmoreland Hempfield Township, Westmoreland Mall 1/24/2018 $40,100,005
Parx Cumberland Shippensburg Township near Rt. 81 2/22/2018 $8,111,000
Hollywood Lancaster Caernarvon Township, Berks County near PA Turnpike 4/4/2018 $7,500,003
Rivers Centre Union Borough, Centre County 9/2/2020 $10,000,101
Total $115,811,109
Invalidated Auction Attempt
Sands Mercer Hempfield Township 2/21/2018 $9,885,000
Mount Airy  Lawrence Big Beaver, Beaver County
Application denied 11/19/2019. 75% of fee returned.
2/8/2018 $21,188,889

 

 

 

Appendix A - License Fees, Tax Rates, and Distributions

Gaming License and Certificate Fees
One-Time Fees Fee Devices Allowed Additional Information
Slot Machine License Fee - Category 1 & 2 $50 million       3,000 Up to 2,000 more slots after 6 months of operation, if approved by the Board. Deposited into the State Gaming Fund prior to 2017/18, after that to the General Fund.
Slot Machine License Fee - Category 3 $5 million           500 Deposited into the State Gaming Fund. Additional 100 slots permitted with a table games certificate.
Table Games Certificate Fee - Category 1 & 2 $16.5 million           250 For certificates issued before June 1, 2010.
Table Games Certificate Fee - Category 1 & 2 - after June 1, 2010 $24.75 million           250 For slot machine licenses issued in 2017/18, the table games fee is due before June 30, 2018.
Table Games Certificate Fee - Category 3 $7.5 million             50 100 more slots allowed if casino also holds a table games certificate.
Expanded Gaming - All Fees Deposited into the General Fund
Category 3 - Additional Slot Machine Fee $2.5 million           250 Allows for additional slot machines.
Category 3 - Additional Table Games Fee $1 million             15 Limited to only poker tables.
Category 3 - Patron of the Amenities Waiver $1 million  N/A  Allows public to patronize casino without patronizing resort amenities or paying a membership fee.
Category 4 Casino - Slot Machine License Fee $7.5 million minimum bid   300-750  Fees are based on auction price. Number of devices may not exceed total complement of the licensee.
Category 4 Casino - Table Games  Certificate Fee $2.5 million             30 Optional certificate fee after slot machine license is approved.
iGaming Certificate $10 million  No limit  Additional $1 million fee for contracted operators. $10 million for current casinos to purchase all 3 (poker, tables, slots) certificates in first 90 days. After that, PA casinos and other qualified entities can purchase any remaining certificates for $4 million each.
Airport Gaming Fee $125,000 to $2.5 million  No limit  Must first have iGaming Certificate. $2.5 million in first-class county, $1.25 million in 2nd class, $500,000 in all other counties with an international airport. For other qualified airports, $125,000.  Only available to iGaming certificate holders.
Fantasy Contest License $50,000  No limit  Allows fantasy sports operators, regardless of location, to collect taxes on contest net revenues adjusted for PA in-state participants.
Video Gaming Terminal License $250 per VGT  5 per truck stop  Truck stop must sell 50,000 gallons of diesel per month, have 20 commercial parking spaces, and occupy  at least 3 acres.
Sports Wagering Certificate $10 million  N/A  Certificate fee deposited into the General Fund. Must first have an iGaming certificate. 
Simulcasting Permit of Horse Races No Fee  N/A  Allows Category 1,2,3 and 4 casinos to simulcast live races from any location for conducing pari-mutuel wagering.
Gaming Taxes, Assessments and Distributions
Slot Machines and Table Games - Prior to Expanded Gaming
($ amounts in millions)
Taxes and Assessments Rate Revenue
2017/18
CumulativeThrough 6/30/2018 Distribution of Funds
Slot Machine Tax - State Share 34%  $    799.8  $     8,419.5 Local property tax relief (wage tax relief in Philadelphia); local law enforcement grants ($2 million per year); compulsive gambling treatment program (at least $2 million per year); drug and alcohol treatment services ($3 million to Dept. of Health); volunteer fire company grants ($30 million).
Slot Machine Tax - County Local Share Assessment 2%  $      23.3  $         911.5 Distributed to host counties to be used for security, road construction, traffic systems, and other local government services needed to support orderly operation of slots facilities.
Slot Machine Tax - Municipal Local Share Assessment $10 Million     Act 42 of 2017 changed the rate from the greater of 2% or $10 million to a fee of $10 million. Windfall provisions roll excess revenues over to the host county.
Race Horse Improvement Assessment1 12%  $    240.2  $     2,728.4 Funds allocated to the horsemen's orgainzation must be used to benefit all horsemen. Benevolent programs include pension and health insurance benefits for the horsemen.
Gaming Economic Development and Tourism Assessment 6%  $    129.6  $     1,250.1 Funds are distributed to specific projects via separate capital budget bills, Act 53 of 2007 and Act 63 of 2008 (H2O PA). Of the 6%, 0.5% of Category 1, 2 and 3 gross terminal revenue goes to the Casino Marketing and Capital Development Account. Category 4 casinos are assessed at 6%, all going to the GEDTF.
Table Games - State Share2 12%  $    126.2  $         791.6 Deposited in the General Fund. If Rainy Day Fund reaches $750 million, revenues would go to Property Tax Relief Fund.
Table Games - Local Share 2%  $      17.9  $         119.9 1% to the host county and 1% to the host municipality.
1The race horse improvement assessment is a formula based on each entity's gross terminal revenue and the gross terminal revenue at all Category 1 licensees, which is capped at 12% of gross terminal revenue. Actual rates are closer to 10%.
2The table games tax rate is 14% for the first two years of table games operation at each casino, then drops to 12%.The state tax rate on fully automated table games is 34% in addition to the base rate of either 12% or 14%. Effective August 1, 2016, there is an additional 2% tax on table games revenue, which is set to expire on June 30, 2019 (Act 84 of 2016 amending the Tax Reform Code).
Expanded Gaming Taxes, Assessments and Distributions
($ in millions)
Taxes and Assessments Rate Distribution of Funds
Category 4 Slot Machine Tax 50% 34% deposited into the Property Tax Relief Fund.
5% to the Commonwealth Financing Agency for project grants in the public interest in any county.
5% distributed to counties whose local share funding levels decrease below 2017/18 levels.
6% to the PA Gaming Economic Development and Tourism Fund.
Category 4 Slot Machine Local Share 4% 2% to the host county.
2% to the host municipality.
iGaming - Table Games and Poker  14% Deposited into the General Fund.  
iGaming - Slot Machine Style  52% 34% to the Property Tax Relief Fund.
5% to counties whose local share decreases below 2017/18 levels.
13% to the CFA for grants in any county for projects in the public interest.
iGaming - Local Share 2% 1% to the host county of the licensed casino, added to and distributed according to  county slot machine distributions.
     - Philadelphia: 1% to the school district.
     - Delaware County (Harrahs): 1% to the county authority for municipal police and
        emergency services  or other economic development.
     - If the certificate holder is not a PA casino, 1% added to and distributed with the
        amount below to the CFA for projects in any county.
1% to the CFA for projects in the public interest in any county.
Airport Gaming - Table Games and Poker 14% Tax rates and local share are the same as iGaming rates; however all taxes deposited into the General Fund.
Airport Gaming - Slot Machine Style 52% Tax rates and local share are the same as iGaming rates; however all taxes deposited into the General Fund.
Airport Gaming - Local Share 2% 1% to the CFA for grants in the host county.
     - Philadelphia Airport: 0.5% to the Philadelphia school district and 0.5% to
        Delaware County.
1% to the CFA for grants in any county.
Fantasy Sports 15% Deposited into the General Fund. Tax collections began May 2, 2018. Each year 0.2% transferred to the Department of Drug and Alcohol Programs for drug and alcohol addiction treatment services.
Video Gaming Terminals 42% Deposited into the Video Gaming Fund. 0.2% of revenues transferred for compulsive and problem gambling; remaining revenue transferred to the General Fund.
Video Gaming Terminals - Local Share 10% Distributed to the CFA for grants in the commonwealth.
Sports Wagering 34% Deposited into the General Fund. Each year 0.2% transferred to the Department of Drug and Alcohol Programs for drug and alcohol addiction treatment services and 0.2% of revenues transferred to the Compulsive and Problem Gambling Treatment Fund.
Sports Wagering - Local Share 2% Distributed to the CFA for grants in the commonwealth.
Simulcasting 1.5% Same as pari-mutuel wagering: 1.5% of the amount wagered on win, place or show wagers and 2.5% on exotic wagers (exacta, daily double, quinella and trifecta). Distributed to the State Racing Fund for regulation of the Racing Commission and for promotion of horse racing.

Appendix B - Slot Machine Revenue Deposits and Fund Transfers

The diagram below shows a basic distribution of the taxes and assessments on slots gaming at land-based casinos. The base of the assessments is gross terminal revenue. For information on distributions from other types of gaming, such as table games and iGaming, see Appendix A.

Property Tax Relief Fund Disbursements
  General Property Tax Relief Sterling Act (Philadelphia Wage Tax Relief) Expanded Property Tax/Rent Rebate Reduction Cities and High Burden Volunteer Company Grants $5 Million Transfer to Lottery Fund for Expanded PTRR Transition Grants to Counties Total
2006-07  $              -    $              -    $              -    $              -    $              -    $  100,000  $              -    $  100,000
2007-08  $              -    $              -    $              -    $              -    $              -    $  100,000  $       2,760  $  102,760
2008-09  $  594,571  $     17,887  $              -    $     48,500  $              -    $              -    $           229  $  661,187
2009-10  $  595,000  $     18,200  $  127,500  $       9,200  $              -    $     40,000  $              -    $  789,900
2010-11  $  595,000  $     21,500  $  129,100  $     26,900  $              -    $       9,900  $              -    $  782,400
2011-12  $  595,000  $     17,100  $  135,900  $     28,200  $              -    $              -    $              -    $  776,200
2012-13  $  595,000  $     20,600  $  137,800  $     29,000  $       5,000  $              -    $              -    $  787,400
2013-14  $  595,000  $     16,600  $  136,700  $     29,800  $       5,000  $              -    $              -    $  783,100
2014-15  $  595,000  $     16,600  $  131,300  $     28,900  $       5,000  $              -    $              -    $  776,800
2016-16  $  595,000  $     21,490  $  136,400  $     30,400  $       5,000  $              -    $              -    $  788,290
2016-17  $  595,000  $     22,900  $  120,700  $     27,300  $       5,000  $              -    $              -    $  770,900
2017-18  $  595,000  $     24,300  $  118,500  $     27,200  $       5,000  $              -    $              -    $  770,000
2018-19  $  595,000  $     24,500  $  114,100  $     27,600  $       5,000  $              -    $              -    $  766,200
2019-20  $  595,000  $     25,500  $  211,500  $     53,500  $       5,000  $              -    $              -    $  890,500
2020-21  $  595,000  $     26,000  $              -    $              -    $       5,000  $              -    $              -    $  626,000
2021-22  $  595,000  $     26,000  $     90,100  $     24,400  $       5,000  $              -    $              -    $  740,500

 

Gaming in Pennsylvania

By Wendy Lewis , Senior Budget Analyst | 11 months ago

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