Video Gaming Terminals Threaten To Derail PA Online Gambling Bill

June 8, 2017
Video Gaming Terminals Threaten To Derail PA Online Gambling Bill


The Pennsylvania House passed a bill that would legalize online gambling on Wednesday night.

That should be cause to celebration for proponents of regulated iGaming in the Keystone State. But any reason to cheer for the future of PA online casinos is tempered by all the other things the House did to the bill.

The biggest speed bump is the House’s inclusion of provisions that would allow video gaming terminals (or VGTs for short) at taverns around the state.

Online gambling moves on in PA

Here’s the nitty-gritty of what’s happened so far for PA iGaming this year, including last night’s action:

  • The House originally passed a “shell” bill in April, intended as a blank slate for the Senate to add revenue-producing gaming measures.
  • The Senate obliged in May, amending and passing the bill with a number of new gaming provisions, online gambling included.
  • The bill returned to the House for concurrence, but it sat idle until Wednesday. The House Rules Committee abruptly amended the Senate version with a number of new things, including VGTs and a much lower tax rate for online gambling.
  • After a sometimes contentious debate, the House ultimately approved the bill 102-89. The bill heads back to the Senate for concurrence.

Why VGTs are a problem

There are major differences between the bills on the tax rate for online gambling. The Senate passed a bill with a non-sensical rate of 54 percent. The House lowered that rate to 16 percent. But there’s a decent chance that a middle ground can be found on taxes.

It’s not at all clear that there is middle ground on VGTs. Chatter in the media and Harrisburg has declared VGTs a poison pill in the Senate dating back to last year. In fact, the House tried to tie VGTs to online gambling last year, but the chamber ultimately declined to advance that effort in 2016.

On Wednesday, some members who had supported online gambling and an omnibus gaming bill in the past cast “no” votes on Wednesday, largely because of VGTs.

Quite simply, the subject of VGTs is quite a bit messier even than online gambling in the state.

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What will happen next for PA online gambling?

The most likely endgame appears to be a conference committee on the bill. That would mean a few members of each chamber would gather to discuss the bill and hammer out final language that would be acceptable to both the House and the Senate. (The possibility still exists of the bill dying altogether because of the major disagreement between the two versions of the bill.)

How such discussions might play out is unknown. After all, yesterday’s amended bill appeared just about out of nowhere — with VGTs included. Some members of the House were flummoxed by the hasty nature of the bill’s amendment and passage during open debate.

If push comes to shove, will the House back down on VGTs in order to pass the over-arching gaming bill? Both chambers have cited the need to generate new revenue from gaming, given the budget shortfall the state faces.

To take a more optimistic view, there’s this: Online gambling is still alive. The fact that the legalization of PA online poker and casinos is still in the mix at all at this late juncture is still a positive development.

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