Is Pennsylvania the New Atlantic City?
For the second straight year, the commonwealth's casinos are on pace to generate more gambling revenue than every other state but one -- Nevada.
Pennsylvania is becoming the new Vegas -- or at least the new Atlantic City.
For the second straight year, the commonwealth's casinos are on pace to generate more gambling revenue than every other state in the union but one -- Nevada.
In 2012, the state's casinos produced $2.47 billion in slot machine revenue, based on statistics released Thursday by the Pennsylvania Gaming Control Board. That's 2.7 percent higher than in 2011 -- good news for the casinos, but not so much for the gamblers who lost the money to any of the 26,476 one-armed bandits across the state.
All those losses generated more than $1.3 billion in tax revenue for the state, about 2 percent higher than in 2011. Slot machine revenue is taxed at roughly 55 percent in Pennsylvania, with the proceeds going mainly toward property tax relief.
If nothing else, the latest figures show just how much of a gambling stronghold Pennsylvania is becoming. In fact, if Bugsy Siegel were building a gambling empire in 2013, he might be staking out land in the Mon Valley rather than the Nevada desert.
Joseph Weinert, senior vice president of Spectrum Gaming Group, an industry consultant, said much of the state's growth has come at the expense of Atlantic City, which for years was the go-to place outside of Las Vegas for Pennsylvania gamblers.
"It's simply a transference of revenue from one state to another," he said. "In Pennsylvania, the industry is still in a growth mode. Properties are still expanding. Table games are still growing, whereas New Jersey is a mature market."
Based on statistics compiled by Spectrum, Pennsylvania now ranks behind only Nevada in terms of total gambling revenue and total slot machine revenue.
For a full year ending Oct. 31, 2012, Nevada produced $6.8 billion in slot machine revenue, compared to $3.1 billion for Pennsylvania. Indiana was third at $2.3 billion and New Jersey fourth at $2.2 billion.
The Spectrum numbers are higher than those compiled by the Pennsylvania gaming board because they include promotional play amounts subtracted out by state regulators.
With table games included, Pennsylvania's total revenue for a full year ending Oct. 31 hit $3.8 billion, second behind Nevada's $10.9 billion, the Spectrum numbers showed. New Jersey was third at $3.1 billion, down 5.8 percent from the previous year.
Pennsylvania revenues, on the other hand, were up 7.3 percent. Richard McGarvey, a state gaming control board spokesman, said one factor in the state's continued growth was the opening of the Valley Forge Casino Resort at the eastern end of the state. In addition, Philadelphia's SugarHouse Casino, which opened in September 2010, got a full year of operation under its belt.
Spectrum doesn't see the state's gambling boom leveling off just yet. It is expecting more growth in 2013, particularly with the Lady Luck Casino at Nemacolin Woodlands Resort in Fayette County scheduled to open this summer.
At the same time, Pennsylvania will be facing more competition from outside its borders in the years ahead. Mr. Weinert said there are only eight states in the country that currently don't have some form of casino gambling. Of those eight, there are "serious proposals" in at least four, including New Hampshire, Hawaii and Virginia, to legalize casino gambling, he said.
"Gambling used to be the exception in this country. Now it has become the rule," he said.
In 2012, Rivers Casino on the North Shore and The Meadows Racetrack and Casino in Washington County ranked third and fifth in the state, respectively, in total slots revenues. Rivers Casino generated $282.1 million in revenue, up 2.3 percent from the previous year, while The Meadows produced $248.9 million, up less than 1 percent.
(c)2013 the Pittsburgh Post-Gazette
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