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Pennsylvania Hoping Online Gaming will Soften Blow

of Lost Revenue from Casino Shutdown

The Sands hotel and casino is seen in Bethlehem, Pa.

(The Center Square) – Two weeks ago on Tuesday, the Pennsylvania Gaming Control Board ordered all the land-based casinos in the state to shut down as part of the effort to control the spread of COVID-19.

While most other states that rely on gaming taxes for revenue are taking a massive hit as the coronavirus pandemic has forced the closure of all commercial casinos across the country, the impact will be softened a bit in Pennsylvania, which along with neighbors Delaware and New Jersey allow online gaming.

With brick-and-mortar locations shut down indefinitely, companies like Rush Street Interactive, which offers iGaming through PlaySugarHouse.com in Pennsylvania and New Jersey and BetRivers.com in Pennsylvania, are seeing a dramatic increase in traffic, according to COO Mattias Stetz.

“On BetRivers.com we are seeing about 4-5 times as many new casino customers signing up compared to what we would expect considering seasonality right now," he said in the first days after the retail closures.

The online jackpots can be as big as those you’d see in the land-based casinos. On Sunday, a West Chester man won more than $159,000, and twice since March 15, winners in New Jersey and Pennsylvania have taken home more than $278,000.

Currently, there’s no time frame for the retail casinos to reopen, and statements President Donald Trump made Sunday extending recommendations to maintain social distancing at least through the end of April will likely make it impossible for the 12 state-licensed venues to open up anytime soon.

Pennsylvania has 39 licenses available for online gaming. That’s a license for slots, a license for table games and a license for poker for each of the 13 licensed casinos either open or under development. Doug Harbach, the communications director for the Pennsylvania Gaming Control Board, said 10 of the state’s casinos secured 27 licenses, 10 each for slots and tables and seven for online poker. Five more have since been claimed by two other entities.

Since the closure order took effect, Harbach said the PGCB has seen a significant amount of traffic in the state’s online poker rooms.


Not all the license holders have launched, but some had planned to do so before the outbreak, Harbach said.

“We are continuing to work with them for a launch and how to conduct testing during the restrictions,” he said.

While the tax rates are similar for online and retail gaming, heading into March, Pennsylvania had received the lion’s share of its gaming taxes from the brick-and-mortar venues.

In February, Pennsylvania received $67.9 million in taxes from $199.7 million in revenue the slots generated at the 12 land-based casinos. Local governments shared an additional $3.9 million. For the 2020 fiscal year, which started in July, the state has garnered $526.3 million and communities have received $30.5 million off $1.55 billion in casino revenues.

Table games accounted for $10.9 million in state taxes and $1.5 million in local taxes last month off gross revenues of $77.4 million. For the fiscal year, Pennsylvania has received $84.3 million from the $599.7 million the casinos have generated from table game revenues. Municipalities across the state have received $12 million.

Online gaming, which officially started in July, saw its best month in February. Bettors wagered $254.7 million on online slots, with the seven active casinos reporting gross revenues of $9.6 million. That provided $3.3 million in taxes for the state and nearly $675,000 in local taxes.

Table games, including poker, generated a handle $448.8 million in February and gross revenues of $8 million. That gave the state $1.1 million in taxes and more than $160,000 to local governments.

Monthly figures are generally released in the middle of the following month.


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