Pennsylvania has officially filed legislation in an attempt to regulate online gambling in the state.
Most of the bill is similar to what was filed in 2016 and lawmakers hope that Pennsylvania can become the fourth state in the United States to regulate general iGaming.
One thing that bodes well for this bill is that the state's Governor has already earmarked funds from gambling expansion in the 2016-2017 state budget. While iGaming is not specified, one assumes that it will play a major component in the estimated figures.
HB 392 Seeks to Regulate iGaming and DFS
House Bill 392 was filed on Wednesday by Rep. George Dunbar and several co-sponsors. The bill seeks to regulate both online gambling and Daily Fantasy Sports.
Overall, the bill is very similar to one filed in 2016 with a few changes to help solve a local share tax issue. The issue is seen as a major obstacle for the bill.
Like in other states, initial licensing fees are a bit steep. An interactive gaming license will incur a fee of $8 million. Each interactive gaming operator will need to also post a $2 million licensing fee.
After the initial fee, renewals are $250,000 for interactive gaming licenses and $100,000 for operators.
As previously anticipated, the tax rate for operators will be 14% of gross gaming revenue. Some have anticipated that this tax rate would dissuade online poker operators from setting up shop in Pennsylvania, but that remains to be seen.
Gov. Wolf Estimates $250 Million from Gambling Expansion Through 2018
One fact that bodes well for this new bill is Gov. Tom Wolf's recent budget proposal. The proposal has earmarked a combined $250 million from "gambling expansion" over the next two years.
Breaking down the numbers, there's $100 million earmarked for the present year's budget and $150 million for the 2017-2018 budget.
It should be noted that his bill did not specify what forms of gambling expansion are expected to generate these numbers but it seems likely that iGaming will be some part of the package.
Expect the majority of funds to come from licensing in the current year's budget as operators begin setting up shop online. Starting next year, we should get a better idea of the financial impact of iGaming in the state.