Friday, October 16, 2009

The Status Of Table Games At Pennsylvania Slot Parlors

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The following Philadelphia Inquirer article provides an update as to the status of table games at Pennsylvania slot parlors, including the Tribe's Pocono Downs racetrack-slot parlor:

Deadlock over taxing table games chokes off help
By Suzette Parmley, Mario F. Cattabiani, and Susan Snyder
Philadelphia Inquirer
October 15, 2009

A seemingly small but unresolved piece of the state budget has delayed millions of dollars in aid for state-supported colleges, museums, and hospitals.

The holdup is "table games" - poker, blackjack, and other games being added to Pennsylvania casinos. Though Gov. Rendell signed the other bills comprising the $27.8 billion budget last Friday after a 101-day impasse, legislators still haven't decided how much to tax the new games.

Until they do, aid to colleges and others has to wait.

The situation prompted testy words yesterday between the Republican-controlled state Senate and the Democratic-led House. It has also left officials reeling at Temple, Penn State, the University of Pittsburgh, and Lincoln University - the four "state-related" colleges due to get more than $600 million from the state this fiscal year to help educate 158,000 students.

"I understand that they have to find the money to pay for everything, but our higher-education institutions are more important than gambling is," said Arthur Hochner, president of Temple's faculty union. The school is due about $183 million in state aid.

Penn State is awaiting a monthly $30 million check. The state's flagship university says it has had to dig into cash reserves and has taken a hit on investment earnings as a result of the delay. "We just hope it's resolved quickly," said spokeswoman Lisa Powers.

Gary Tuma, press secretary for Rendell, said the governor could not sign the bills to get colleges' aid flowing until the table-games legislation, with its projection of $200 million in revenue, was in place. "We see this more as a timing issue than anything else," Tuma said.

The delay prompted the Senate majority leader, Dominic Pileggi (R., Delaware), and its president pro tempore, Joe Scarnati (R., Jefferson), to write to House Speaker Keith McCall (D., Carbon) yesterday urging him to call the House back into session to take up table games and the delayed appropriations bill for colleges and others.

"There is simply no good reason to withhold this critical funding," the senators wrote.

The House is not scheduled to return to session until Nov. 9, but House members were put on six-hour call, meaning they could get called back to Harrisburg on short notice.

"We are hopeful we can resolve our differences quickly," said Brett Marcy, spokesman for House Majority Leader Todd A. Eachus (D., Luzerne). "We are hopeful we can find a middle ground on these issues so that we can complete these last pieces of the budget."

The state Senate passed a bill late Friday that would tax the games at a rate of 12 percent, plus an additional 2 percent to local municipalities, and charge each casino a $15 million license fee; smaller "resort casinos" would pay half that amount.

Pileggi said yesterday that he thought Senate Republicans could agree to a 15 percent tax rate. A Democrat-backed House bill calls for 34 percent, but Democrats have signaled they would settle for the high teens.

"We would have preferred to have reached a compromise on table games," Rep. Bill DeWeese (D., Greene), the House majority whip, said yesterday. "But we did not, so in order to fund the traditional state budget, every other measure was included in the appropriations bill and fiscal code, except for the table games" and the bills freeing up money for state-related colleges, hospitals, and museums.

Unlike, say, the state police, the colleges are merely "state-related," not state-run. "They can only be funded if there is money available," explained Johnna A. Pro, spokeswoman for State Rep. Dwight Evans (D., Phila.), the House appropriations chairman.

In all, 28 institutions fall into that category. They range from Penn State and Temple to the Franklin Institute, the Academy of Natural Sciences, and Children's Hospital of Philadelphia. Their state aid this fiscal year adds up to about $730 million.

School officials say they are dismayed that their funding has become entangled in the table-games debate.

"The state-related institutions are still without a budget because of the battle over table games," said Temple president Ann Weaver Hart, speaking at the Coalition of Urban and Metropolitan Universities conference in Philadelphia on Monday. "We have no appropriation, and it is now October."

Meanwhile, casino operators throughout Pennsylvania want a resolution soon, too. They are hoping to have poker and other games running by spring.

The Pennsylvania Casino Association, which represents three of the state's casinos - SugarHouse in Philadelphia, Mount Airy in the Poconos, and The Rivers in Pittsburgh - has insisted all along on a tax rate of 12 percent for table games.

The rate "will determine the number of tables that we see," said the group's executive director, Ken Smukler.

Just get it done, said Michael Hill, vice president for development and external relations at Lincoln University in Chester County, awaiting nearly $14 million in state funding. In other words, 22 percent of Lincoln's budget.

Hill said the school had frozen its hiring and cut back on travel.

"The issue of gaming is not the issue. It's the issue of resolving," Hill said. "Get together and resolve whatever issues to allow us to continue to educate our students."