Sen. Ward Expected To Meet With PA Casino Officials When Session Resumes This Week.

From The Looks Of It, Online Gambling Will Reemerge As A Hot Topic In PA Sooner Rather Than Later

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The Pennsylvania legislature will return to Harrisburg this week, and there is still quite a bit of unfinished business from last session on the agenda.

Included among these outstanding issues are the legalization of online gambling and solving the local share tax paid by casinos to host communities.

Both will be top priorities for the legislature in 2017.

Informal meeting to get ball rolling

According to the Tribune Live, “Sen. Kim Ward, R-Westmoreland and chair of the Community, Economic and Recreational Development Committee, has asked officials from all 12 casinos to be in Harrisburg that day [January 3] to discuss potential changes.”

However, legislation isn’t expected to get any serious consideration until the end of the month.

Ward, and her Senate colleagues had the chance to pass a bill that would have legalized online gambling and solved the state’s local tax share dilemma created by the Pennsylvania Supreme Court‘s ruling that the current model is unconstitutional.

The Senate chose not to act, which means the incoming legislature is under the gun to get both issues solved by the spring. Pennsylvania has already earmarked the $100 million online gambling is expected to generate in Year 1 for the budget

Stronger together?

Since the Pennsylvania Supreme Court made its ruling, the local share tax and online gambling have been joined at the hip, particularly in the House of Representatives.

But it’s unclear if the Senate will suddenly go along with the House’s proposal, or if they will continue to try to decouple the local share tax from online gambling, and try to find another way to come up with the $100 million for the state budget.

Senate Minority Leader Jay Costa told the Pittsburgh Post-Gazette he plans on introducing a bill that would be a modest expansion of gambling, but would still generate the $100 million in revenue. It’s unclear if online gambling would be a part of Costa’s proposal.

On the House side, Representative Rosita Youngblood told Online Poker Report she would continue to push for a comprehensive gaming reform bill that included online gambling in an interview in December.

“I plan to once again push for a comprehensive gaming reform bill in 2017,” she said. “House Bill 2150 was a great start. The amended version of House Bill 1887 that the Senate failed to pass this fall was probably a more realistic approach.”

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Is a key Adelson ally defecting?

The local share tax is the more pressing issue, and the anxiety it’s creating in some corners is putting a strain on some relationships in the Keystone State.

Northampton County District Attorney John Morganelli is applying pressure on Sands Casino to reach a similar agreement to Valley Forge, Parx, and Harrah’s that would keep the local host money flowing until the legislature passes a new bill.

According to the Allentown Morning Call, if Sands doesn’t come to an agreement to pay the $10 million host fee, Morganelli has said he won’t commit resources to prosecute certain types of crimes committed against the casino, such as, stealing by passing bad checks.

“I would not in good conscience be able to justify the use of my limited resources to help a profitable billion-dollar corporation while the Sands maintains the position they are an island unto themselves,” Morganelli said in a news release cited by the Morning Call.

The comments aren’t as surprising as they first appear, as there has been an ongoing debate in Pennsylvania when it comes to nonviolent financial crimes, and whether they should be dealt with as civil or criminal cases.

Morganelli typically comes down on the side of prosecuting these cases.

David Arnold, the district attorney of Lebanon County and president of the Pennsylvania District Attorneys Association told the Morning Call, in general, prosecutors have leeway over which cases they’ll pursue, and limited resources can force their hand.

“The question becomes, ‘Is that a good use of our resources when they [alleged victims] can go to civil court and resolve those cases?'” Arnold said.

Arnold also said the explicitness of Morganelli’s comments could be problematic for the DA, telling the Morning Call, “I think it’s fair to consider what type of appearance it gives.”

So, while the threat has the hallmarks of being a strong-arm tactic to force Sands hand and make them agree to a temporary tax share solution, there is a basis for adopting this hands-off policy when it comes to nonviolent financial crimes committed against Sands Bethlehem.

What is a bit surprising is who is applying the pressure, and what impact it might have on the state’s efforts to legalize online gambling.

Morganelli has been an Adelson/Sands ally when it comes to online gambling, which raises the question of how far he is willing to go to get Sands to agree to pay the local host tax.

If Sands continues to avoid reaching an agreement on the local host community share, Morganelli could apply additional pressure to Sands by withdrawing his longstanding opposition to online gambling. Whether this would have any impact on legislators is anyone’s guess.

- 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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