Senate changes may stall Pa. casino bill into 2010

AP News
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Posted: Dec 17, 2009 8:37 AM

Entrenched conflicts in the Legislature over a measure to expand casino gambling in Pennsylvania seemed certain Wednesday to extend a monthslong disagreement into next year and leave major universities without crucial subsidies longer than they had expected.

Senators voted 27-22 on a bill Wednesday night and then immediately left the Capitol for the holidays. However, the bill met with immediate criticism from House Democratic leaders, who had ushered their own version through their chamber less than 24 hours earlier.

The news is bad for Penn State, Pitt, Temple and several other universities that are scrimping by without their normal state subsidies, which are being held up by Gov. Ed Rendell.

With the state's tax collections lagging behind projections, the extra tax revenue from expanding gambling is necessary to help underwrite the universities' subsidies, Rendell has said.

Rendell's chief of staff, Steve Crawford, said Wednesday night that no decision had been made on what to do about the schools' money given lawmakers' inability to compromise.

"We have reason to believe that it will be dealt with finally in early January," Crawford said. If not, "there will be dire consequences, because this is a $250 million hole in the budget. It's not a game."

Both the House and Senate bills would allow table games at Pennsylvania's slot-machine casinos while reforming the state's regulation of the gambling industry, including various provisions designed to thicken walls between the industry's influence and public officials.

Proponents, including Rendell, say legalizing table games is a less painful alternative to raising taxes to shore up the state's recession-ravaged treasury.

Opponents counter that financing government with gambling money is bad policy and say the measure is strictly about doing a favor for the powerful gambling industry.

Legalizing table games increases the value of a state casino license, and two of the Senate's changes to the House bill are particularly problematic in the House because they could affect the potential location of a new casino.

That is setting off a clash between lawmakers who are concerned about hometown interests.

"We're all optimistic that they're going to concur and realize this is as good as its going to get coming out of the Senate," said Senate Community, Economic and Recreational Development Chairwoman Jane Earll, R-Erie.

Democrats wrote a provision into the House bill to increase the number of casino licenses from 14 to 15. It was necessary to win the votes of some members who want to boost the chances of getting a casino in their district, said House Gaming Oversight Chairman Dante Santoni, D-Berks.

However, the Senate removed that provision and added another one that would pave the way for new competitors to seek Pennsylvania's last remaining available casino license.

"If the Senate moves forward with their amended bill, we have a problem. The votes aren't there" in the House, said Brett Marcy, a spokesman for House Majority Leader Todd Eachus, D-Luzerne.

Allowing new competition for the existing license would open the door to two groups _ the owners of the Nemacolin Woodlands Resort in Fayette County and investors interested in a Gettysburg-area site _ who have expressed interest in a license if table games are legalized, said Sen. Robert M. Tomlinson, R-Bucks.

The current applications for the last remaining license _ submitted by the owners of the Fernwood Hotel & Resort in the Pocono Mountains and investors interested in a Reading-area site _ are in locations that would cannibalize customers of existing casinos in eastern Pennsylvania, Tomlinson said.