Pennsylvania's first slot machine casino attracted $85 million in wagers in only half a month of operation and generated nearly $5 million for the state for property tax relief and other purposes.
But for players at the Mohegan Sun casino at Pocono Downs, the 1,096 slot machines weren't exactly easy money. Their payouts, on average, were the lowest among casinos along the East Coast in November, according to one analyst.
Figures released by the state Gaming Control Board showed that $85 million was wagered last month at the Mohegan Sun, which opened Nov. 14. Players won $76.3 million.
The racetrack/casino produced a gross terminal revenue -- the difference between the amount wagered and the amount paid to winners -- of $8.7 million. The state's cut, with its 55 percent tax on slots revenue, was $4.8 million.
Of that amount, 34 percent will go for property tax relief; 12 percent for horse owners, breeders, and trainers; 5 percent to a special economic development fund; 2 percent for the host county and 2 percent for the host municipality.
Jim Wise, vice president of marketing for the Mohegan Sun at Pocono Downs, said it all added up to an "excellent start."
"I would say we're satisfied. For 1,100 games, that's very good business. When you have the opportunity to be the first, that is a terrific unique advantage, and I think we certainly enjoyed some of that advantage in our first 30 days," he said.
Payouts to players averaged 89.73 percent, or nearly 90 cents for every dollar wagered, said Joseph Weinert, vice president of Spectrum Gaming Group, which produces an East Coast slots report every month.
The payouts, on average, were the lowest among casinos on the East Coast last month, he said. The highest was Hollywood Slots in Bangor, Maine, at 93.3 percent. The average was 91.07 percent.
Nonetheless, the Mohegan Sun payouts were higher than the 85 percent minimum allowed under state law.
Mr. Weinert said the lower payouts could be a direct result of the state's gambling tax, among the highest in the country.
"We do not expect payouts in Pennsylvania to be on the high side due to the onerous effective gaming tax rate," he said.
Mr. Weinert noted that the other slots casino with a lower payout for November, 90.4 percent -- was Florida's new Gulfstream Park parlor, which opened the middle of last month. Florida also has a high tax rate.
If lower payouts end up being the norm in Pennsylvania, it could cost casinos business, particularly if players find better opportunities in neighboring states.
"If there's a meaningful difference in payout percentage between Pennsylvania and neighboring competitors, it could hurt," he said.
"If a customer has a choice of casinos nearby and they see a report that one casino has a 93 percent payout and one has an 89 percent payout, chances are the one with a 93 percent payout is going to get more business," he added.
However, Mr. Wise said it was way too premature to try to analyze payouts based on half a month in operation. He said that the machines need time to complete full cycles, adding that percentages can be thrown out of whack by early jackpots or other factors.
"You do need time to get a little more balance for that," he said.
That said, Mr. Wise noted that the Mohegan Sun payouts were less than a percentage point off the 90.6 average in West Virginia over the last 12 months.
The average payout in Delaware over the same period was 91.8 percent, Mr Weinert said. In New Jersey, it was 91.7 percent. For the Mohegan Sun casino in Connecticut, it was 91.4 percent.
The state Gaming Control Board hopes to begin posting revenue numbers from Pennsylvania casinos on its Web site in January. By then more racetrack casinos should be in operation.
Spokesman Doug Harbach said the numbers will be posted on a regular basis. Officials are looking at everything from daily to monthly postings, he said.
