Pennsylvania Vote Nears on Racetrack Slots Licenses

Pennsylvania gambling regulators are expected to give the state's racetracks the go-ahead Sept. 27 to plug in thousands of slot machines, the biggest step in two years toward making Pennsylvania one of the nation's busiest gambling markets.

The seven-member Pennsylvania Gaming Control Board is scheduled to vote on whether to grant conditional slots licenses to the state's six racetrack owners, which include the nation's largest casino operator, Harrah's Entertainment Inc. With most, if not all, of the racetracks expected to get the nod, Pennsylvanians for the first time will soon be able to play slots in their home state, instead of driving to Atlantic City, N.J., Delaware, New York, or West Virginia.

To wrap around the gambling floors, the racetrack owners are spending well over $1 billion to tear down old grandstands and rebuild them with steakhouses, spas, and sports bars. The Mohegan Indians, who operate a huge casino in Connecticut, are shooting to open the first slots parlor in Pennsylvania. Mohegan Sun at Pocono Downs, in the northeastern region of the state, could open its doors as early as November.

"We're going about 100 mph right now," racetrack spokesman Jim Wise said. "It's a very exciting time. It's a lot of long hours and lot of energy being expended, but it's all worthwhile to get this building open."

A temporary slots parlor in the renovated grandstand at the track near Wilkes-Barre will house the machines until a more elaborate gambling hall can be built over the next two years. The rest of the racetrack owners expect to unveil slots casinos over the course of the next year.
In December, the gaming board plans to decide whether to issue permanent slots licenses to the racetracks, as well as to pick from among 15 casino developers and established resorts that are competing with one another for seven additional slots licenses.

A 14th slots license is set aside for whoever wins the state's final harness racing license. Applicants from Lawrence and Beaver counties were rejected by the Pennsylvania Harness Racing Commission, but a Pennsylvania appeals court said the commission erred in rejecting the bid of Bedford Downs in Mahoning Township. The court upheld the rejection of Valley View Downs in Beaver County. The appeals court decision is being appealed by both the commission and Valley View Downs.

Ultimately, Gov. Ed Rendell expects Pennsylvania's slots parlors to pull in $3 billion a year, with most of the state's share to be used to help cut local taxes and boost the state's share of spending on public schools.

If his projection proves accurate, Pennsylvania would become the third-biggest commercial gambling state in the nation, behind Nevada and New Jersey and ahead of Mississippi and Indiana, based on 2005 statistics compiled by the American Gaming Association.

Pennsylvania's July 2004 law that legalized slots allows up to 61,000 machines, a number that would make Pennsylvania the second-biggest slots state behind Nevada, not counting Indian casinos.

With racetracks in each corner of the state and most near major population areas, including Philadelphia and Pittsburgh, at least two-thirds of Pennsylvanians will live within an hour's drive of a gambling hall. Pennsylvania's racetrack slots also will be an hour's drive from competing gambling destinations, such as Atlantic City.

Pennsylvania's horse breeders and racetrack owners are heralding the arrival of slots as the savior of the state's declining equine industry. With neighboring states using slots to plump up purses at their racetracks, many breeders and bettors have drifted away from Pennsylvania in recent years, industry officials said.

"It will be the first time in a long period that people will be able to make money in this business in Pennsylvania," said Joe Thomson, a Pennsylvania-based Standardbred breeder who has farms in Delaware, Maryland, New York, and Canada--but not Pennsylvania.

Many officials in Pennsylvania's racetrack towns also have welcomed the slots as a boon to their bottom lines. Officials in the Bensalem Township have long been slots boosters because they feared losing Philadelphia Park, the biggest employer and taxpayer there.