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House bill prompts outcry from stand-alone casino operators
Thursday, October 08, 2009

HARRISBURG -- Three stand-alone casinos will demand that the state return their $50 million slots license fees if the Legislature allows two small "resort hotel" casinos to triple their number of slot machines.

The Rivers Casino in Pittsburgh, Mount Airy Casino in the Poconos and the proposed SugarHouse Casino in Philadelphia -- which begins construction today -- contend that allowing the two resort hotel casinos to have 1,500 slots -- instead of the current limit of 500 -- would cause them "immediate and irreparable harm."

The House is now considering Senate Bill 711, which would allow Pennsylvania slots casinos to add table games like roulette, blackjack and poker. But legislators are also talking about tripling the number of slots allowed at resort hotel casinos. Only one of the two authorized resort hotel casinos has been licensed -- in suburban Philadelphia, at Valley Forge Convention Center, just off the turnpike.

That location is only about 20 miles from the Delaware riverfront site where SugarHouse will be built. Nemacolin Woodlands resort in Fayette County recently said it might resurrect its interest in getting the other resort hotel slots license, and could prove to be competition with the Rivers Casino in Pittsburgh.

The House version of Senate Bill 711 could also contain another change the four large casinos don't like -- letting members of the general public gamble at the two resort hotel casinos, rather than limiting such patrons just to people already staying at the hotel.

Some legislators are also talking about letting the two resort hotel casinos have a few table games, but the four stand-alone casinos didn't discuss that possibility in a news release yesterday.

The 2004 law creating slots casinos said that if the law gets a major change within five years after the casinos got their licenses (in late 2006), the casinos could seek their one-time $50 million license fee back. The Rivers, Mount Airy and SugarHouse say that's exactly what they'll do if the Legislature triples the slots at the resort hotel casinos.

"Any move to change (the restrictions on resort hotel casinos) will be viewed as a breach by the Commonwealth of the terms under which we, as (stand-alone casinos) applied for and were granted" when they got their gaming licenses, the four casinos said in the statement.

The three casinos also said they will seek financial damages from the state in addition to the return of the license fees. If the state is forced to refund the three $50 million slots license fees, it would cost the state $150 million, which could lower the money available for property tax relief.

Bureau Chief Tom Barnes can be reached at tbarnes@post-gazette.com or 717-787-4254.
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First published on October 8, 2009 at 12:00 am