PA Considers Gambling

Interlink, May 28, 2004, p.3

By Roger Thomas, Member WPA Witness Team

 

 

 

 

 

 

Pennsylvania is considering racetrack gambling under House Bill 623.  The Witness Team went to the casino in Mountaineer, WV to see how things were going there.  It is run by the same firm that wants to operate our casinos.

The idea in HB623 is that racetrack owners could operate 3,000 slot machines at their track.  There could be 40,000 machines statewide.  The Mountaineer casino has 3500 machines.

The $50,000,000 Pennsylvania license would only be available to the racetrack operators.  Illinois offered open bidding, and received over three times that amount.

All slot machines revenue would be transferred directly to the Pennsylvania Department of Revenue every day.   The Department would then 1) deduct its administrative costs and expenses, 2) distribute 1% of the gross to the host municipalities, 3) transfer 1% of the gross to the Department of Community and Economic Development for "infrastructure improvements and public safety expenses associated with the racetrack and slot machine operations."

After making the three deductions, the Department of Revenue would deposit 34% of the remainder into the State Gaming Fund.   That leaves about 64% of the gross revenue for the owner's account.  West Virginia collects 38%.

The state would move the money from the Gaming Fund to the Property Tax Relief Trust Fund every month.  HB623 does not say how the Property Tax Relief Fund will be distributed.

The State Gambling Fund would provide for a Compulsive Problem Gambling Treatment Fund.  The Department of Health would "develop program guidelines for public education, awareness and training regarding compulsive and problem gambling, and the treatment and prevention of compulsive and problem gambling."  Compulsive Gambling would be authorized $1,500,000 per year for the entire program.

HB623 prohibits "the use or extension of credit to players."  West Virginia has the same provision, but Mountaineer has 10 MAC machines and several credit card debit machines down the hall from the casino.

We interviewed a bus driver from Northern Lights who drives loads of people to Mountaineer.  He told us how even these drivers sell "markers" to their customers.  Gamblers freely obligate their homes, cars, and other personal property as collateral for the markers, and the lenders can forcibly collect on them.  There are instances in which the casinos support the lenders with temporary funds.  Markers are legally enforceable in Pennsylvania.  We met with Sen. Gibson Armstrong (R-Lancaster) about these, and have offered him some proposed statutory language.

The Mountaineer casino is a stock corporation that employs about 1500-1800 people.  Employees start at minimum wage and get merit - rather than seniority - promotions. They tend to be full time employees, except for some people in the food and beverage department.  They are open from 7:30 AM to 4:30 AM every day except Christmas.

As shown in the photograph, about 75% of their players are retirees.  Players get "points" for the number of games they play. These (green stamps) may be applied to other services such as food and spa.

We did a random sample in the parking lot, and found 15 Pennsylvania plates in a row of 68 cars.

We mentioned the absence of a third party liability provision in HB623 to Sen. Armstrong.  Every product or service has protection for third persons who their product injures.  Even bars and taverns have dramshop laws.  If bartenders continue to serve drinks to customers who the ordinary person would know was intoxicated, the tavern can be liable for subsequent injuries.  He had us send him some proposed language on that too.

 

 

 

The Western Pennsylvania Conference of the United Methodist Church adopted the following Resolution, 75-3-7, on June 11, 2004

RS 102 Gambling Regulation

1) Whereas "Gambling is a menace to society, deadly to the best interests of moral, social, economic, and spiritual life, and destructive of good government. As an act of faith and concern, Christians should abstain from gambling and should strive to minister to those victimized by the practice. Where gambling has become addictive, the Church will encourage such individuals to receive therapeutic assistance so that the individual's energies may be redirected into positive and constructive ends. The Church should promote standards and personal lifestyles that would make unnecessary and undesirable the resort to commercial gambling-including public lotteries-as a recreation, as an escape, or as a means of producing public revenue or funds for support of charities or government." The Book of Discipline of The United Methodist Church--2000, ¶163G

2) Whereas the "Pennsylvania Gaming Act of 2003" (House Bill 623 of Session 2003, Printer Number 2473) would allow racetrack owners "to place and operate slot machines."  There is a limit of 3,000 machines per track, and 40,000 machines statewide. Only the racetrack owners can buy the permits.

3) Whereas the Bill requires that all revenue from the slot machines be transferred directly to the Pennsylvania Department of Revenue every day.  The Department 1) deducts its administrative costs and expenses, 2) distributes 1% of the gross to the host municipalities, 3) transfers 1% of the gross to the Department of Community and Economic Development for "infrastructure improvements and public safety expenses associated with the racetrack and slot machine operations," 4) then deposits 34% of the remainder into the State Gaming Fund. The balance is transferred into the owner's account.

4) Whereas the State Gambling Fund transfers $1,500,000 into a Compulsive Problem Gambling Treatment Fund annually. This fund is to provide for all compulsive gamblers in Pennsylvania.  The Department of Health must develop program guidelines for public education, awareness and training regarding compulsive and problem gambling, and the treatment and prevention of compulsive and problem gambling.

5) Whereas the Gaming Fund must transfer its remaining balance into the Property Tax Relief Trust Fund.  The Bill does not say how the Property Tax Relief Fund will be distributed.

6) Whereas the Bill prohibits the use or extension of credit to players, but it does not prohibit credit card machines on the premises.  Nor does it prohibit the sale of "markers" by private loan sharks.

7) Whereas every vendor should be liable for injury caused by the goods and services they provide.  This Bill makes no provision for vendor liability.

8) Whereas a standard vendor liability provision could be added to this Bill as follows:

Any person who is injured in person or property or means of support, by an impoverished person, or resulting from the impoverishment of a person, has a right of action for all damages actually sustained, severally or jointly, against any licensee or permittee, whether or not the license or permit was issued by the division or by the licensing authority of any other state, who provided credit to the impoverished person when the licensee or permittee knew or should have known the person was impoverished, or who provided credit to and assisted the person to a point where the licensee or permittee knew or should have known the person would become impoverished. If the injury was caused by an impoverished person, a permittee or licensee may establish as an affirmative defense that the impoverishment did not contribute to the injurious action of the person. The remedy provided by this section shall apply to actions filed on or after the effective date of this Act. Every permittee or licensee shall furnish proof of financial responsibility by the existence of a liability insurance policy in an amount determined by the Department. (Iowa's statute 123.92 Civil liability for sale and service of beer, wine, or intoxicating liquor (Dramshop Act) ---liability insurance.  http://www.legis.state.ia.us/IACODE/1997/123/92.html)

9) Whereas gambling tends to create more social problems than it compensates in jobs and revenue.  The Pennsylvania State Lottery, for example, was created as a self-sustaining venture to fund prescription drugs and other programs for seniors.  The lottery has operated in a deficit for several years, and taxpayers are paying its administrative costs out of the general fund.

Be it therefore resolved that the Western Pennsylvania Conference of the United Methodist Church is opposed to the adoption of any gambling policy as inherently evil.

Be it further resolved that if a gambling policy is adopted in Pennsylvania, we encourage open bidding on the permits.

Be it further resolved that if a gambling policy is adopted in Pennsylvania, we urge that markers sold for gambling credit are unenforceable at law

Be it further resolved that if a gambling policy is adopted in Pennsylvania, we urge that it contain a vendor liability provision which will protect innocent persons from the negligent acts of casinos or gamblers.

Be it further resolved that if a gambling Act is adopted in Pennsylvania, we urge that it contain a "sunset provision" which provides for the expiration of the Act.

Be it further resolved that if a gambling Act is adopted in Pennsylvania, we urge that at least 80% of the employees in all pay scales be long standing residents of the host municipality.

Be it further resolved that that the clergy and the laity are encouraged to provide testimony, support, and encouragement to the members of the Pennsylvania legislature toward the introduction and passage of the legislation recited in this resolution.

Rand Edwards, Chair Witness Team