Report On DFS Could Help Clear The Way For PA Gambling Expansion

Is Online Gambling Legalization Tied To Daily Fantasy Sports In Pennsylvania?

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Expectations that Pennsylvania could pass an online gambling bill were extremely high at the start of 2016. The bill, HB 649, would legalize online gambling (among other things) through the state’s existing land-based casinos, was all the rage in 2015, and seemed poised for passage in 2016.

In an interview with Online Poker Report in December, the bill’s sponsor, Rep. John Payne, shed some light on the path forward for the bill. At the time, Payne told OPR the plan for HB 649 has always been to use the revenue it creates as a means to close the state’s pension deficit. He said he believed that issue would be addressed in the spring of 2016.

Over the first five months of 2016, online gaming advocates have grown increasingly anxious, as HB 649 has sat untouched and universally unmentioned. In fact, until very recently, the bill received very little local or national press, and seemed to have fallen by the wayside.

However, according to the bill’s sponsor, this is not the case. The bill is still alive and well, and this holding pattern was expected.

The plan remains the same for PA online gambling

In an interview with OPR this week, Payne reiterated his previous comments that the bill’s purpose is to close the state’s pension deficit. “It hasn’t changed,” Payne stated, adding that he’s “still hopeful 649 crosses the finish line.”

Failing this, the bill could potentially be included in the state budget — something that was attempted last year. The state is always looking for additional revenue streams, and budget negotiations could extend well into the fall or winter.

Payne noted that the bill has been kept active through the requisite legislative procedures, namely, rotating the bill by moving it on and off the table.

Payne went on to intimate that one reason it’s been quiet on the HB 649 front is because the bill has moved beyond the point of hearings. That being said, an upcoming daily fantasy sports hearing, which will take place after the Pennsylvania Gaming Control Board submits its report on DFS later this month, could have ramifications for HB 649.

Is DFS holding up online gambling?

When it was first introduced, HB 649 was exclusively an online gambling legalization bill. Over the course of 2015, the bill morphed into a comprehensive gaming reform measure that included everything from the easing of licensing restrictions imposed on the state’s Category 3 “resort” casinos to the addition of slot machines at off-track-betting parlors and in secured areas of Pennsylvania airports.

Towards the tail end of 2015 yet another gaming reform was being discussed in the Pennsylvania legislature, daily fantasy sports. A DFS bill first emerged in May of 2015, but only really gained momentum following the strife in the DFS industry that began in October of 2015 and propelled into the national spotlight.

A late amendment to HB 649 (one of many) called on the state’s Gaming Control Board to produce a DFS report if HB 649 was passed. This report was later requested in a separate bill. It’s quite likely that if DFS legalization and/or regulation were to be considered in Pennsylvania, HB 649 would be the eventual vehicle, in order to keep all of the proposed gaming reforms tied together.

Fast forward to the present: The DFS report is due on May 27, with a hearing to follow (tentatively scheduled for June 1) according to Representative Payne. The impetus of the hearing is for the Gaming Oversight Committee to accept the Gaming Control Board’s report on fantasy sports and its recommendations for regulation.

Upshot for iGaming in PA

The legislature may very well be waiting for a definitive answer on DFS — hoping to add it to the long list of gaming reforms already included in HB 649 — before moving on HB 649.

It appears the fate of HB 649 is largely tied to daily fantasy sports. The reason HB 649 may have sat collecting dust over these past months, was so the legislature could consider the state’s impending report on the DFS industry. That way it could be tacked onto HB 649, rather than attempting to pass multiple gaming reform measures separately.

- Steve covers nearly every angle of online poker in his job as a full-time freelance poker writer. His primary focus for OPR is the developing legal and legislative picture for regulated US online poker and gambling.
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