Sand’s Bethlehem’s Mark Juliano denounces Senate slots plan
Sands Bethlehem CEO Mark Juliano’s opposition to slots expansion in Pennsylvania is inadvertently doing online gambling a huge favor. (Image: mccall.com)
The Las Vegas Sands Corp has said it will pull hundreds of millions of dollars-worth of investment in Pennsylvania if the legislature opts to pass controversial gambling expansion legislation in the state. And for once the company’s fury isn’t directed at online gambling.
On Tuesday, Pennsylvania’s House of Representatives passed packaged legislation, HB 2150, which would legalize and regulate online gambling, DFS and authorize slot machines in airports.   
HB 2150 was able to avoid the addition of an amendment that sought to license slot machines at bars and taverns across Pennsylvania, which was politically controversial and would have derailed the entire package. Unencumbered, however, it was approved by a vote on the House floor and passed to the Senate for consideration.
But now it seems that a group of Senate members want to add language to the bill that would permit the creation of up 20 satellite slot parlors across the state, to be owned by the states’ 10 licensed casinos.

Threat to Online Gambling and DFS

Not only would this jeopardize hugely the chances of online poker and DFS’s passage through the Senate, but, according to Mark Juliano, CEO of Pennsylvania’s largest casino complex, Sands Bethlehem, it would also cause LVS to halt future investment in the state.
Juliano told the Allentown Morning Call that the proposed parlors would damage the casino industry, drawing people away from the every casino in the state.
Under the Senate proposal, each casino would pay a $5 million license fee to operate a satellite, which would have to be 50 miles from any existing casino. But this would cannibalize the casino industry, Juliano said.
“We’ve got a big investment here and it’s the highest taxed jurisdiction in the country,” he warned. “I don’t know where they think all these new customers are coming from, but we’re certainly not going to continue to make a commitment to reinvest if they follow through with this.

Casino Cannibalization

“Only about 50 percent of our business is within that 50 miles,” he explained. “The rest is coming from 90 miles away and beyond. This is not good business by Pennsylvania. This only hurts a model that’s been working for a decade.
“We thought all we had to worry about was New Jersey. We didn’t think we had to worry about our own legislators. If this happens, what we have now is all they’re going to get.”
As extraordinary as it seems, LVS, in opposing the Senate proposal, LVS is actually fighting online gambling’s corner, despite its deep-seated opposition. Some members of the Senate have made it clear that any bill proposing the proliferation of slots would be political poison.
“Fundamentally opposed to online gaming, yes,” said Juliano, lest we forget. “But would it keep us from investing? Probably not.”