Pennsylvania Gets Ball Rolling On Sports Betting Regulations

After the PASPA ruling, we dove into the existing industry framework in the state and concluded the road was all clear for legal sports betting in Pennsylvania. With temporary regulations now in place, Pennsylvania continues to show a willingness to move quickly on the regulation of sports betting.
PA Ball Rolling Sports Betting

Although the temporary sports betting regulations the Pennsylvania Gaming Control Board approved on Wednesday don’t reveal much we don’t already know, let’s focus on the positives: the ball is rolling on full sports betting regulation in the Keystone State.

For sports bettors, casinos, racetracks, potential sports betting operators, Pennsylvania state officials, and pretty much everybody except for people who think gambling is the devil, this is amazing news.

After the PASPA ruling, we dove into the existing industry framework in the state and concluded the road was all clear for legal sports betting in Pennsylvania. With temporary regulations now in place, Pennsylvania continues to show a willingness to quickly take its first bets.

The temporary regulations

In what amounted to a few minutes of a meeting that lasted over an hour, the PGCB tabled and approved a 21-page packet of temporary sports betting regulations. Along with the approval, the PGCB announced that the temporary regulations marked “the beginning of sports betting regulation in Pennsylvania” and that, if things progress well, they would like to start accepting applications for sports betting licenses and certificates sometime in mid-June.

Here are the sections included in the General Sports Wagering Provisions document released by the PGCB:

  • Definitions, which are words and terms that have outlined meanings unless the context clearly indicates otherwise
  • Details on initial and renewal certificate and license fees
  • Details on sports wagering certificate petitions and standards

Skin in the game

One of the most intriguing aspects of the entire document comes in the definitions section, where they’ve included a reference to website skins (yes, plural):

“The interactive gaming skin or skins through which a sports wagering certificate holder, or interactive gaming operator or sports wagering operator on behalf of a sports wagering certificate holder, makes authorized sports wagering, mobile sports wagering or interactive sports wagering available for play when authorized by the Board.”

It was only back in April that Pennsylvania lawmakers decided that online gambling license holders in its state would, in fact, be allowed to operate and support multiples skins. It’s reasonable to assume similar skin rules and regulations will apply to online sports betting.

On the surface, this sounds like a sweet deal. However, the language pertaining to online gambling skins comes off as somewhat restrictive.

At the very least, we know that online gambling skins must be intimately tied to the license holder via branding. But it also looks like skins will have to be subdomains of the license holder’s site, and that players can only have one account per license holder.

Taxes and fees unaddressed

This brings us to perhaps the most disappointing aspect of the release of these provisions: Pennsylvania hasn’t yet considered making changes to the sky high tax rates and licensing fees it plans to levy on sports betting operators.

A $10 million licensing fee and a 34% tax rate on gross revenue – in addition to possible integrity fees – is far too prohibitive, hindering the ability of smaller casinos to put up a worthwhile effort.

In the meeting, the PGCB said it, “Will consider the comments, questions and concerns of all interested parties when it comes to full sports betting regulations.” Unfortunately, the high fees and tax rates aren’t set or influenced by the PGCB, but are rather part of the expansion laws passed by legislature. Only time will tell, but it would be nice if the state at least considered lowering these numbers.

Other news from the PGCB board meeting

The other piece of news to come out of the May 30th PGCB board meeting was a unanimous decision to renew the Category 2 Casino License of Sands Casino Resort Bethlehem. The board claims it collected information from both the operator and the public in order to reach a decision. So in a move that comes as a surprise to nobody, Sands Bethworks, LLC received a five-year renewal on its Operator’s License.

Sands was sold to the gaming arm of the Poarch Band of Creek Indians (Wind Creek Hospitality) in March, for the sum of $1.3 billion.

Since opening its doors in May of 2009, Sands Casino Resort Bethlehem has garnered almost $4 billion in revenue from slot machines and table games, which has resulted in over $1.6 billion in gaming tax revenue for Pennsylvania. In addition, Sands Casino Resort Bethlehem currently employs over 2,400 individuals across its properties.

With any luck, the presence of legal sports betting in Pennsylvania will be a boon to the new owners of Sands, its employees, the gambling industry, and the state as a whole.


Related Posts