Video poker merits debated at hearing
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The machine vendors pleaded for a chance to profit from legalization of video poker.
The tavern owners asked for a chance to profit more than has been proposed.
And the religious representative didn't want anyone to profit at all.
Those were among the comments at Westmoreland County Community College yesterday at a House Gaming Oversight Committee hearing on Gov. Ed Rendell's controversial proposal to legalize video poker in neighborhood establishments across the state.
The governor touts the plan as a way to provide $550 million annually in tuition assistance to students at state-owned universities and community colleges.
That money would be the state's 50 percent share of revenue raised from allowing the video lottery terminals in bars, restaurants and clubs holding liquor licenses. The administration estimates nearly 9,000 license holders would average four machines each, for a total of 35,400 devices -- about equivalent to the number of slot machines Pennsylvania's casinos are likely to end up with.
The presidents of Indiana University of Pennsylvania and Beaver County Community College testified about the positive impact the program would have, especially for low- to moderate-income students. Kathleen Shaw, state deputy secretary of postsecondary and higher education, touted the benefit of giving Pennsylvania a better-educated workforce without piling debt onto families.
But the details of the plan have nettled the traditional providers of coin-operated amusement devices to bars and clubs. Those entrepreneurs -- many of whom have supplied the video poker machines used illegally in establishments for years -- would be left out. The governor wants to contract with a single supplier of the machines, similar to the Pennsylvania Lottery, in the belief that will improve regulatory control.
John Milliron, legislative counsel for the Pennsylvania Amusement and Music Machine Association, predicted more than half of the 350 to 400 such establishments in the state will go out of business if they're excluded from supplying and maintaining the devices. The other games they supply won't generate sufficient profits because people will gravitate toward the newly legalized machines, he said.
Meanwhile, representatives of the Pennsylvania Tavern Association -- a group that has long lobbied for legalization of video poker -- expressed concern that the plan outlined in House Bill 1317 will not be lucrative enough for them. The 25 percent of revenue they would retain would be sapped by state and local licensing fees, taxes and other costs, they said.
Association Executive Director Amy Christie testified that discussions have begun with the governor's staff about possible financial adjustments.
The lone critic of the gambling-for-tuition idea on principle yesterday was Stephen Drachler, executive director of the advocacy arm of The United Methodist Church in Pennsylvania. He said lawmakers of both parties in Harrisburg have been too eager to use gambling -- despite social ills it creates -- as a source of funding.
Rep. Dante Santoni, D-Berks, gaming committee chairman and sponsor of the legislation, maintained the legalization would not expand gambling because the machines are already so prevalent.
He said two more hearings will be held in coming weeks, and the concerns raised will be considered, before the committee votes to send the measure to the full House before the summer recess. Its chances for passage in the Republican-controlled Senate are considered more difficult.
First Published May 8, 2009 12:00 am