Pennsylvania lawmakers continue to work on next year’s state budget with neither side appearing to budge regarding the impasse. An issue that has received nationwide press has been iGaming regulation. It is estimated that regulated iGaming could bring the state $50 million the first year in licensing fees.
Online poker regulation in Pennsylvania will also have an impact on nearby states, especially New York. Today we take a quick look at what impact a yes or no vote for iGaming will influence New York’s chance of regulation in the near future.
Legal Online Poker in PA Accelerates NY Passage
Should lawmakers decide to move forward with online poker regulation in Pennsylvania, the most logical result would be added pressure upon New York lawmakers to do the same.
Think about it. If Pennsylvania passes online poker, then you have New Jersey, PA and Delaware all with regulated online poker. A short drive into either state and players can start gambling online. They don’t need to go to the casino, just go visit some relatives or even rent a cheap hotel room for a day or two and setup shop.
In addition to pressure from citizen lobbyists, casinos will start to pressure state lawmakers and regulators as online gambling becomes a much more credible threat to NY casinos if both NJ and PA are regulated. If both states decide to join the interstate online poker network, this makes things even worse for NY as players have an added incentive of a four-state network to play on.
While we will stop short of saying that online poker would pass in NY in 2016 if PA goes online, we do believe it would accelerate to a two-year timeline.
Issue Continues to be Ignored if PA Ignores Issue
On the other side of the coin, if PA lawmakers decide to pass on iGaming, then NY will probably do the same thing. The threat to the NY casino industry isn’t as dire if PA decides to sit out. While NJ and DE are regulated, DE really isn’t that big of a threat to NY interests.
If PA decides that iGaming isn’t for them, whether for the short-term or long-term, NY will follow suit. We estimate that a no vote for PA effectively kills any momentum in NY through 2016 and into 2017.
The Longer the Impasse Lasts, the More Appealing iGaming Becomes
As the PA budget impasse enters the holiday season, lawmakers are looking for ways to overcome the stalemate and get the budget completed. Hearings on iGaming have been scheduled and subsequently cancelled but talk about the issue continues.
Lawmakers need to find sources of revenue and it will be to their benefit if those resources do not come out of taxpayer pockets in the form of new taxes. The longer this impasse lasts, the more appealing that online gambling becomes. While it is still considered to be a taboo issue to some, the revenue potential cannot be overlooked by the state.
Unless another solution can be devised by the beginning of the year, iGaming may be one of the only viable options that lawmakers can pursue short of taxing citizens and this could override any trepidation on their part. This could be the piece of the puzzle that helps ultimately balance the budget.