Pennsylvania Slots Bill Headed to Governor

Legislation to authorize slot machines at Pennsylvania racetracks and other locations passed the state House of Representatives early the morning of July 4 and now heads to Gov. Ed Rendell for his signature.

The state's share of revenue from slots will finance $1 billion a year in property-tax reductions. Rendell is a Democrat who made tax relief the centerpiece of his 2002 election campaign.

"A good example of government working for the people," Rendell said in the Capitol Rotunda shortly before dawn.

Rendell is scheduled to sign the bill at Philadelphia Park the morning of July 5, according to a press release that appeared on the wire.

The bill authorizes slots at 14 locations, at least seven of them racetracks. Four tracks already operate in the state: Philly Park, owned by Greenwood Racing; Penn National Race Course and the Downs at Pocono, owned by Penn National Gaming Inc.; and The Meadows, operated by Magna Entertainment Corp.

Two other tracks have been licensed: Chester Downs and Marina and Presque Isle Downs, which is owned by MTR Gaming, the parent company of Mountaineer Race Track & Gaming Resort. Two other racetrack licenses are up for grabs.

In a statement released July 4, MEC president Jim McAlpine said the legalization of alternative gaming "will have a significant positive impact on purses and on the Pennsylvania horse racing industry in general." MEC plans to pursue an application for a slots license "without delay," the release said.

The legislation authorizes the granting of licenses to up to seven tracks and up to five non-track locations, as well as two resorts. Successful track and non-track licensees would be able to operate 1,500 to 3,000 slot machines, with an additional 2,000 possible with approval from the new Pennsylvania Gaming Control Board. The resorts could each have up to 500 machines.

The state would get 34% of gross revenue. Horsemen would get 12% from track-based slots, however, contributions from non-track slots casinos would increase the share for purses and breed development to about 18% of gross revenue. Local governments would get 4% of revenue, and a state economic development fund 5% of revenue.

Lawmakers also approved a $22.8-billion budget for the new fiscal year, the Associated Press reported. The Senate approved the budget bill unanimously, while the House vote was 193-8. The slots bill was approved by the House on a 113-88 vote following an 8 1ò2-hour debate that began July 3.

Republican Rep. Daryl Metcalfe said the slots legislation was "Machiavellian" and "extremely flawed." He said it would create increases in crime, among other things. House Minority Leader H. William DeWeese accused the bill's critics of "'demagoguing" in an attempt to kill the measure.

The Senate approved the slots bill July 2 and the tax bill July 3. Together, the measures would authorize as many as 61,000 slot machines--more than any other state except Nevada. A proposed gambling commission would issue slots licenses to racetracks, resorts and other sites for fees ranging up to $50 million each.

The bill would make Pennsylvania the 18th state to legalize slot-machine gambling, not counting casinos run by Indian tribes, according to the American Gaming Association.