Pennsylvania Casinos Finally Decide To Apply For iGaming Licenses

Pennsylvania's expanded gambling law allows for brick-and-mortar casinos to apply for a bundled license which will allow them offer online versions of the games that they offer in their land based casinos. Pennsylvania became the fourth state towards the end of 2017 to legalize online poker joining Nevada, New Jersey and Delaware.

The initial response was very weak as land based casinos were not eager to apply for an iGaming license as they believed that the gaming taxes imposed were way too high for them to cut any profit.

However, three casinos finally sent in their iGaming license just a few days before the July 16 deadline for applying for an online gaming license approached.

Currently, three eastern Pennsylvania casinos have taken the first steps to apply for an iGaming license and a fourth casino is still on the fence. The bundled iGaming license costs $10 million and must be filed on or before the deadline, which does not leave much time for the fourth casino to make a decision. However, if the casino misses the deadline, they can get separate licenses to offer slots, table games, or poker but they will have to pay $4 million for each license. The deadline for these separate licenses is valid till the end of August.

If the casinos don't file for a license, they won't be able to get into the state's online gambling market. However, not all of the state's 13 casinos are enthusiastic about the online gambling option because the 54 percent gaming tax that the law enforces on operators is a barrier for many operators. The lack of interest from the land based casino industry is a blow to the state as legislators passed the iGaming law in the hope of getting a new stream of revenue.

High Licensing Fees And Taxes Not Attractive Proposition

Most of the western Pennsylvania casinos like Lady Luck Casino Nemacolin in Fayette County and Presque Isle Downs & Casino in Erie County have made no indication that they would be applying for licenses. Some experts point out that this is not a surprising decision as with the taxes and large licensing fees, casinos might not be able to profit from the arrangement.

In a statement, Chris Grove, an analyst for the PlayUSA website, said

If this were an all-or-nothing deadline, then it would be a critical date but given the dynamics in which so few may be interested in offering online poker, I don't know if the number of applications you see by Monday will be an accurate barometer of the market

The revenue from online gambling will be less than the land based casino industry but it still represents an expansion of the gambling market. Online gambling is just one part of Pennsylvania's gambling expansion. There are also plans for sports betting, both offline and online, in the state.