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Showing posts with label Presque Isle Downs. Show all posts
Showing posts with label Presque Isle Downs. Show all posts

Saturday, October 1, 2016

UPDATED: Court strikes down casino payments to host communities in Pennsylvania




Geoff Freeman, CEO of the American Gaming Association, said as the ... made by casinos since the state passed the casino gambling law in 2004.


After rejecting city budgets in 2014 and 2015 and withholding about $20 million in gambling tax revenues, the Pittsburgh Tribune-Review reported that ...


The Sands Casino Resort Bethlehem provides its host city with almost $10 million annually in slot-machine revenues. (Express-Times file photo).


HARRISBURG, Pa. (CN) — The Pennsylvania Supreme Court ruled that a municipal tax on slot machines outside Philadelphia violates the state ...


With revenues at every casino always falling below $500 million a year, the $10 million has always been higher than the percentage take would be.

Casinos, with their flashy slot machines, lavish buffets and smoky table games, came with heavy strings attached that now serve as fiscal lifelines in ...


Former Harrison Mayor Jeff Crockett said he saw enough economic potential in the proposedcasino amendment that he hosted petitions for people in ...


Sands Casino Resort Bethlehem, for example, pays $16 million in fees to local communities. The $8.8 million Bethlehem gets is equivalent to 100 ...



The state's highest court on Wednesday ruled a formula in the state gaming act that determines how much gaming revenue casinos are required to ...




The state Supreme Court has struck down casino host fees that cities have come ... By striking down the tax paid by casinos, the court strips more than $16 ... state gaming law imposes a 2 percent fee on gross slot machine revenues, ...

High court strikes down casino payments to host communities
HARRISBURG, Pa. (AP) — Pennsylvania's highest court is striking down the tax that casinos pay their host communities, potentially devastating local ...

Local Governments Could Lose Funding From Casinos - Erie News Now
Millions of dollars are given to local governments each year, from fees paid by Presque Isle Downs, and other casinos in the state. But now, those ...


Hollywood Casino at Penn National Racetrack in Dauphin County. A court ruling will force the state legislature to reconsider payments to casinos' host ...


That difference cost nine Pennsylvania casinos a total of $48.5 million in the year ended June 30, according the Pennsylvania Gaming Control Board's ...


Luzerne annually receives approximately $12 million on average in Local Share Account program money from gambling revenues from the Mohegan ...


HARRISBURG, Pa. —Pennsylvania's highest court on Wednesday struck down a requirement that has forced casinos to pay tens of millions of dollars ...


PLAINS TOWNSHIP — Communities where Pennsylvania's casinos are located could lose tens of millions of dollars, thanks to a state Supreme Court ...



People sit at the bar at Mohegan Sun Pocono casino on Christmas day. ... because it is not uniform and affects Pennsylvania's 12 casinos differently.


HARRISBURG — Pennsylvania's highest court on Wednesday struck down a requirement that has forced casinos to pay tens of millions of dollars to ...



Farmland preservation could suffer if state lawmakers fail to restore $16 million in casino host fees paid out by Sands Casino Resort Bethlehem.

Court strikes down casino payments to host communities in Pennsylvania

Published  12:16 PM EDT Sep 29, 2016

The Pennsylvania Supreme Court ruled that the roughly 4 percent "local share assessment" is unconstitutional because it is not uniform and affects Pennsylvania's 12 casinos differently.
The justices said they would delay the effect of their decision striking down the tax for four months to give lawmakers an opportunity to fix it.
"We are mindful that our decision may significantly affect many counties and municipalities that have ordered their affairs in reliance upon" the casino tax revenue, Justice David Wecht wrote in the 18-page opinion.
Under the state's original 2004 casino law, casinos must pay at least 4 percent of gross slot-machine gambling revenues to their host communities. That includes 2 percent to counties and 2 percent or $10 million, whichever is greater, to municipalities.
  
SugarHouse Casino in Philadelphia is exempt, as are two smaller "resort" casinos: Valley Forge Casino in suburban Philadelphia and Lady Luck Casino Nemacolin in southwestern Pennsylvania.
  
But Mount Airy Casino in northeastern Pennsylvania's Pocono Mountains had asked the court to strike down the $10 million host fee, arguing that it violates the state constitution by imposing a heavier tax burden on lower performing casinos.
  
Some $141 million in slots revenue was paid in the last fiscal year to counties and municipalities, according to Pennsylvania Gaming Control Board data. That included about $48 million paid by casinos to satisfy the $10 million host fee requirement.
  
Gov. Tom Wolf's office declined comment on the ruling Wednesday. Senate officials said the decision could have far-reaching effects.
  
"We will take action and we'll do it in such a way to maintain the casino obligation to our local communities," Senate Appropriations Committee Chairman Patrick Browne, R-Lehigh, told the Morning Call of Allentown. "This would absolutely devastate these towns."
  
Douglas Hill, executive director of the County Commissioners Association of Pennsylvania, said the money is significant for counties.
  
"Very clearly, the gaming revenue has gone to legitimate and worthwhile local purposes, all aimed at improving the community, and equally for the host municipalities," Hill said.
  
The amount of the host fee is equivalent to the cost of 100 police officers, Bethlehem Mayor Robert Donchez told the Morning Call.
  
"So this is something that we're very concerned about," Donchez said.
  
The court also awarded relief to Mount Airy Casino, although the amount was not immediately clear.



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Sunday, August 21, 2016

Could Bethlehem lose casino cash cow?





Could Bethlehem lose casino cash cow?

 Of The Morning Call
AUGUST 20, 2016

Pennsylvania lawmakers and casino executives have been squabbling for months about whether things such as online gambling or satellite casinos could help close the state's budget deficit, but another fight winding through the state Supreme Court could have a far bigger impact on Main Streets across the state.
Mount Airy Casino is asking the court to strike down the $10 million host fee most casinos pay to the towns where they are located, arguing it violates the state constitution by putting a much heavier tax burden on lower performing casinos.
If Mount Airy wins its case, it could eliminate a large chunk of the annual fee casino towns across the state use to pay for a wide variety of items.

"Our host fee is equivalent to the salaries of 100 police officers," said Bethlehem Mayor Robert Donchez. "That's a significant amount of money. That host fee is extremely important to our budget."
Sands Casino in Bethlehem is not contesting the fee it pays Bethlehem, but any decision issued by the Supreme Court likely would dictate how every casino must pay — or not pay.
A Mount Airy win would be a devastating blow to the budgets of most casino towns that collect the fee, but there's no need for those municipal leaders to panic, just yet. State legislators suggest they'd move quickly to alter the law to replace the fee — or at least they'd try. State legislators have spent much of the past year debating how to expand gambling to raise more money to balance the budget, but have not been able to reach consensus.
"I don't know exactly how we'd go about it, but given that this fee has been established for a decade, we're not just going to let this money be stripped from municipalities that rely on it," said Sen. Pat Browne, who chairs the powerful Senate Appropriations Committee.
Unequal tax
The case is being defended by attorneys from the state attorney general's office, which argues the tax scheme does not violate state law.
The case started in April 2015, when Mount Airy filed a legal challenge that argues the "local share tax" violates the uniformity clause in the state constitution, which requires that "all taxes shall be uniform, upon the same class of subjects." As a constitutional challenge to the gaming law, the matter was eligible to bypass lower courts and be filed directly to state Supreme Court.
The 2004 state gaming law imposes a 2 percent fee on gross slot machine revenues, to be paid to the municipalities where the casinos were built. However, the law also states that a minimum of $10 million must be paid. Therefore, the 2 percent would only really come into play once gross slot machine revenues for a casino went above $500 million.
Because that's never happened, the nine casinos affected by the law — SugarHouse Casino in Philadelphia and two resort casinos aren't subject to the minimum requirement — simply pay $10 million a year.

That creates an unequal tax that has some casinos paying a much bigger portion of their revenues to their host community. So, while the $10 million paid by Pennsylvania's most lucrative casino, Parx in Bensalem, was just 2.8 percent of the casino's 2014 gross slot machine revenue, the $10 million Mount Airy paid was more than 7 percent of its $140 million in revenue for 2014.
Each day, the Department of Revenue siphons 2 percent of all slot machine revenues from each casino and distributes it quarterly to the host community. At the end of the year, if that casino hasn't generated $10 million in fees then state regulators instruct the casino to make the payment needed to reach the $10 million minimum.
That "true-up" payment is what Mount Airy is contesting. For Mount Airy, the payment was $7.2 million for 2015, but even successful casinos have to write big checks. Sands, for example, had to pay $4 million to reach its minimum for last year.
In Sands' case, $3.2 million of that true-up payment went into Bethlehem's general fund and about $800,000 went to Allentown, under a deal struck between the cities before the gaming license was given to Bethlehem. It's a similar story in casino towns across the state, where casinos — depending on their revenue — pay end-of-year true-up fees ranging from Parx's $2.4 million to the $7.7 million paid by Presque Isle Casino, Erie.
"All we're asking for is uniformity and fairness, and that $10 million rate is neither," said Michael Sklar, the Atlantic City attorney who is co-counsel for the Mount Airy suit. "We think if the court strikes down the $10 million minimum, the 2 percent tax passes constitutional muster."
In addition to asking that $10 million minimum be struck down, Mount Airy is asking the court to award damages. While it doesn't specify how much, it has paid $57.4 million in true-up fees since it opened in 2007, second only to Presque Isle's $61.8 million.
Not a surprise
Part of Mount Airy's argument is not only that lesser performing casinos are unfairly burdened, but also that not every casino must pay the $10 million minimum. SugarHouse Casino in Philadelphia pays a straight 4 percent of its gross revenue. That consists of the same 2 percent all state casinos pay to their host county, plus another 2 percent that represents the local share, but without the $10 million minimum Mount Airy and other casinos pay.
Christopher Craig, a Pennsylvania Treasury attorney and former legislative counsel who wrote much of the gaming law, wouldn't predict how the court will rule, but he explained why the law was written the way it was.
The proposed Philadelphia County casinos in the law weren't given a $10 million minimum because the city was expected to be the only municipality that would have two casinos, therefore there was no need for a minimum. As it turned out, SugarHouse has been the only casino built so far, while the other gambling license has been delayed for years.
More to the point, Craig said the host fee is just that — a fee that every casino applicant was aware of when they applied for a gambling license in 2004. Though the Mount Airy suit repeatedly refers to it as a "Local Share Tax," it was actually called a "Local Share Assessment" in the law, Craig noted.
"A cost was identified for the impact gambling would have on a municipality and that cost was $10 million," Craig said. "In exchange for engaging in an activity that would otherwise be illegal, the licensee agreed to pay a minimum of $10 million."
That's how Sands Casino CEO Mark Juliano interprets it.
"We knew exactly what we were getting into when we applied for the license," Juliano said. "We're not trying to get out of it. We don't intend to join in the suit."
But two other casinos also have raised similar challenges. Harrah's Casino in Chester filed a similar suit last year and Rivers Casino in Pittsburgh filed a nearly identical suit in July. Harrah's suit was stayed while the Mount Airy case runs its course, and Rivers withdrew its case just a few weeks after filing it, presumably to wait for the Mount Airy decision.
Both sides have spent months filing preliminary objections and briefs, and oral arguments have already been made. There's no time limit on how long the court has to deliberate on the matter, so a decision could come any day, or it could be months away.
Analysts say the court could do everything from deny the challenge, to strike down the $10 million minimum requirement — or even strike down the entire local share fee altogether. It also will have to decide whether Mount Airy and the other casinos deserve a refund of any of the the more than $320 million in true-up payments they've made the past decade.
"This is one everyone is watching closely," Browne said. "There's a lot at stake."

AT ISSUE
• Mount Airy Casino is asking the Supreme Court to strike down the $10 million host fee most casinos pay to the towns where they are located.
• All casinos pay 2 percent of all slot machine revenues to the state Department of Revenue to be distributed to host communities. However, if that amount is less than $10 million annually, casinos are required to kick in the difference.
• That difference, a "true-up" payment, is what Mount Airy is contesting. In 2015, Mount Airy's true-up payment was $7.2 million.




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Thursday, July 21, 2016

Rivers Casino challenge to slots tax highlights big checks Pa. casinos have been writing




Slot machine tax challenged by Rivers Casino
TAGS: PennsylvaniaGamingCasinosTaxesPennsylvania Gaming
Every day, 2 percent of the cash earned by every slot machine at Rivers Casino goes to the city of Pittsburgh. In 2015, that amounted to $5.5 million. But it wasn’t nearly enough. At the end of the year, the North Shore casino cut a check for another $4.5 million to hand over to the city — representing the difference between what its slot machines produced and the minimum $10 million that Pittsburgh is entitled to annually under state gambling law.
View original Article

Rivers Casino challenge to slots tax highlights big checks Pa. casinos have been writing

July 21, 2016


By Mark Belko / Pittsburgh Post-Gazette
Every day, 2 percent of the cash earned by every slot machine at Rivers Casino goes to the city of Pittsburgh. In 2015, that amounted to $5.5 million. But it wasn’t nearly enough.
At the end of the year, the North Shore casino cut a check for another $4.5 million to hand over to the city — representing the difference between what its slot machines produced and the minimum $10 million that Pittsburgh is entitled to annually under state gambling law.
Rivers Casino is no exception.
Last year, eight other casinos in the state ponied up anywhere from $2.4 million to $7.6 million in “true-up” payments to cover the difference between what their slot machines produced for local municipalities and the minimum $10 million they are required to pay their communities.
The municipal portion of the local share tax, enacted when slot machine gambling was legalized in Pennsylvania in 2004, is now the subject of legal challenges by Rivers and two other casinos — Mount Airy and Harrah’s Philadelphia.
Stakes have become high in the legal tussle — so high that Pittsburgh Mayor Bill Peduto canceled an appearance at Rivers Casino Wednesday for a Northside Chamber of Commerce event.
He felt “it is not appropriate to appear at the casino while it is making the city the subject of a lawsuit putting taxpayer funds in jeopardy,” spokesman Tim McNulty said.
Under the system being challenged, all casinos in the state are required to pay the municipal portion except those in Philadelphia and the resort casinos in Nemacolin and Valley Forge. The affected venues pay 2 percent of their gross terminal revenue if it exceeds $500 million or $10 million if it is less than that.
In its lawsuit filed last month, Holdings Acquisition Co., the Rivers Casino owner, claimed the provision “imposes unequal rates of taxation on slot machine licensees” and violates uniformity and equal protection clauses in the state and U.S. constitutions.
The law lacks uniformity, it maintained, because it ordains two tax rates on the same class of taxpayers depending on whether gross terminal revenues are above or below $500 million. That difference in treatment is “arbitrary and not rationally related to any legitimate government purpose,” Holdings argued.
Compounding the matter, at least in the eyes of Holdings, is that casinos in the city of Philadelphia pay 4 percent of their gross terminal revenue as the local share but are not subject to the $10 million minimum. Resort casinos pay 2 percent and aren’t subject to the $10 million minimum.
In the 10 years the state has been collecting the municipal share, no casino has ever exceeded the $500 million figure, meaning all have been required to write checks every year to hit the $10 million level. That’s despite the fact many would be paying much less based solely on revenues.
The way the system works is that the state collects 2 percent a day from casino slot machines and earmarks it for the municipal share. At the end of the year, the state calculates how much has been collected and how much each casino owes as a “true-up” payment to reach the $10 million.
Last year, Parx Casino, the largest in the state, shelled out the least, $2.4 million. Presque Isle in Erie, anted up the most, $7.6 million.
Rivers paid $4.5 million, while The Meadows Racetrack and Casino in Washington County paid $5.6 million.
The majority paid between $4 million to $5 million.
Christopher Craig, who helped craft the state’s gambling law as a lawyer working for former state Sen. Vincent Fumo, said the local share was added to help municipalities offset the costs, including police and infrastructure, associated with hosting a casino.
As for the 2 percent versus the $10 million, the legislature was seeking to strike a balance between the needs of the municipality and “not creating a burden” for the casino, Mr. Craig said.
The 4 percent was put in place for Philadelphia because legislators felt gross terminal revenues for casinos in that city would generate more than $10 million a year for the local share.
“People can go back 12 years and quibble with some of the public policy decisions,” Mr. Craig said. “At the end of the day, the act has been extremely successful.”
Should Rivers prevail, Pittsburgh would lose $10 million a year in revenue, though payments the past few years have been tied up in a battle with the Intergovernmental Cooperation Authority. Rivers also is demanding about $65 million in refunds for money it paid in the past.
Pittsburgh has been using the gambling funds to prop up its ailing pension fund, as required under the Act 47 recovery plan.
If the city loses the money, it would not be able to meet that state mandate or would have to cut $10 million from “core municipal services” to do so, Mr. McNulty said. The city intends to intervene in the lawsuit.
“The local share tax payments were one of the conditions for granting the casino its license, and it never should have taken this frivolous legal action,” Mr. McNulty said.
Like the city, Denis Rudd, a professor and director of hospitality and tourism management at Robert Morris University, doesn’t think the casino has much of a beef. He said there’s definitely a cost to the municipality in hosting such a venue “and that’s the reason they get a chunk of” the revenue.
Mr. Rudd conceded $10 million is nothing to sneeze at — even for a casino like Rivers that produced $272 million in gross terminal revenue last fiscal year, 54 percent of which went for taxes, including the municipal payment. But all casinos knew going in what the cost would be, he noted.
“They agreed to it, so they should have to pay it,” he said.



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Monday, April 21, 2014

'Common knowledge' about slot machines often wrong



'Common knowledge' about slot machines often wrong


By Mark Gruetze

Published: Sunday, April 20, 2014, 9:00 p.m.Updated 14 hours ago


Here's a quick true-or-false quiz:
 
• The American Psychiatric Association recently declared that posting selfies is a mental disorder.
 
• Obamacare requires every participant to implant a microchip holding medical information and a link to the user's bank account.
 
• Oracle CEO Larry Ellison tops this year's Forbes list of “most punchable” CEOs, followed by BP's Bob Dudley, Amazon's Jeff Bezos and Rupert Murdoch of News Corp.
 
All are myths, the work of imaginative writers trying to be funny or make a point.
The danger is that they sound plausible enough that some people might take them as fact.
That sounds like a lot of the “common knowledge” about slot machines. Many gamblers, refusing to concede that machines are indeed machines, assign them superhuman powers to explain personal losing streaks and others' winning spins. Here are a few common slot myths:
Running hot or cold
It's a frequent question by players on the way to the casino floor: Are the machines hot today? Slots don't have cycles. With each spin, you have the same chance of hitting a jackpot, regardless of what the machine paid on the last spin or the last thousand spins. Each machine contains a random-number generator that constantly spews out combinations that determine the outcome of a spin. The instant you hit the spin button, the RNG locks in a combination that tells the machine whether to pay out. How the symbols line up and whether you advance to a bonus round are just entertainment for you.
That was my jackpot!
Some players wait for a big bettor to leave a machine after losing, figuring it's “due” to hit. Nope. While each machine is programmed to pay out a specific percentage of what's wagered, that's calculated for the lifetime of the slot, meaning millions of spins over years of use. What happens in an hour or two doesn't matter. Even if the newcomer hits a jackpot on the first spin after taking over the seat, the player who left can't legitimately claim “that should have been my jackpot.” The winning combination was set at the millisecond the second player pushed the button; even if the original gambler had stayed, it is highly unlikely he would have hit the button at the same instant.
The secret code
Some people swear casinos place loose machines on the aisles, while tight ones go near the restrooms. A gambling buddy used to insist that a meter sometimes visible underneath the reels revealed the machine's hit frequency. In general, players have no way of learning a machine's payout rate. The list of possible combinations and payouts is on a top-secret PARS (Paytable And Reels Strip) sheet, accessible to casino officials and regulators.
The Omniscient Machine
Some people say using a player's club card reduces the number of payoffs. Others swear the machine automatically pays less for free play than for cash. Those who refuse to use their player's cards throw good money after bad; not only are they playing against a high house advantage, they're refusing valuable comps. The points earn free play, free food, free drawings; in essence, you get back a portion of what you bet. Why give that up? The machine can't tell the difference between free-play credit and cash credits. Again, each spin is independent; you have the same chance of winning each time.
I never win
Never say never. You do win here and there, but most people put the winnings back into the machine. The occasional profitable visit gets overshadowed by a string of losses. Recognize that slots are a horrible bet; although big jackpots hit often enough to keep players hopeful, overall the house wins about 10 percent of all wagers. If slots are your gambling choice, play slowly to make your money last longer. You're better off learning games with a lower house edge, such as video poker or blackjack.


Read more: http://triblive.com/aande/gambling/5959439-74/million-machine-percent#ixzz2zX7nKGwX
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About Mark Gruetze
PictureMark Gruetze 412-320-7838
Administrative Editor
Pittsburgh Tribune-Review
Mark Gruetze has been a recreational gambler for more than 30 years, focusing on blackjack, video poker and poker. He is administrative editor of the Tribune-Review.

Keith Hodan | Tribune-Review
Slot machines are the most popular form of casino gambling.



Details
Money trail
Statewide casino win for March: $284.1 million, down from $296.7 million in March 2013, the state's best month on record. Last month's total includes $67.93 million from table games and $216.21 million from slot machines.
Statewide slot payout rate since July 1: 89.9 percent; for every $100 bet, machines return an average of $89.90
High and low payout rates: 90.74 percent at Lady Luck Nemacolin; 89.19 percent at Penn National near Harrisburg
Rivers: 89.69 percent slot payout; March table-game revenue, announced last week, was $6.14 million, down from $6.74 million last year
 
Meadows: 89.94 percent; March table-game revenue $3.01 million, down from $3.32 million


Presque Isle: 89.49 percent; March table-game revenue $1.15 million, down from $1.3 million
Lady Luck Nemacolin: 90.74 percent payout; March table game revenue $496,884; not open last year
Source: Pennsylvania Gaming Control Board
Casino sues over $9.6 million baccarat win
Borgata Casino in Atlantic City claims pro poker player Phil Ivey cheated when he won $9.6 million playing baccarat on four occasions in 2012.
The lawsuit says Ivey knew of defective cards made by Gemaco Inc. in Missouri and gained an advantage over the casino when the casino used them in the game. Ivey, companion Cheng Yin Sun and Gemaco are defendants.
 
The casino says Sun asked the dealer to turn “good” cards one way and “bad” cards another as they were dealt. Because of a slight difference in the pattern on the back of the cards, Ivey could predict the value of the first card of each hand in subsequent deals, the suit says. The house normally has a 1.06 percent edge in baccarat, but the suit says the knowledge gave Ivey a 6.765 percent edge over the casino.


Read more: http://triblive.com/aande/gambling/5959439-74/million-machine-percent#ixzz2zX8ZndLp
Follow us: @triblive on Twitter | triblive on Facebook


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