PA Legislators Given Extension to Solve Slot Tax Levy Issue

by Jim Hall

Legislators in Pennsylvania have been given an extension to be able to solve the slot levy tax issue.

September 2016 was a stressful month for legislators in Pennsylvania as the state Supreme Court decided to rule in favor of the Mount Airy Casinos position that a slot levy tax in the state is unconstitutional. The court ruled that the tax was not fair as each venue paid a different amount, especially the smaller casinos as compared to the larger venues. Legislators were given 120 days to come up with a solution and have been unable to do so. Thankfully, the state Supreme Court have given legislators an extension to come up with a solution.

A Little Background

To begin to understand, we must go back to last year. Legislators in the state were unhappy to find the court took away the slot levy tax which is $10 million or 2% of slot gaming venues paid to the casino’s host municipality. There are 12 casinos in the state of Pennsylvania so several counties and municipalities were able to benefit from over $140 million total in taxes paid each year. The court ruled the tax was unfair as smaller venues were paying different amounts than the larger casinos.

The court decided to stay their decision for 120 days to give legislators time to come up with a fair solution for the tax. In the meantime, municipalities were scrambling, trying to find a way to pay for various programs and community needs. Thankfully, while legislators couldn’t seem to come to an agreement, casinos and local officials could, with many gaming venues choosing to continue to pay the money to help their local community.

Legislation was created that could have solved the issue but was not passed in time last year. Legislators had until this Friday to come to a solution but were unable to do so, asking for an extension of which they have been granted.

A Little More Time

Justice David WechtLegislature now has 120 more days to try and find a way to see the more than $140 million still paid in the state while appeasing all gaming venues. At the time of the first deadline, many legislators felt that the time frame was unrealistic and would not be met. The Supreme Court has now provided more time, until the 26th of May, for the legislators of the state to come to a decision due to an emergency petition filing.

Justice David Wecht was the only judge in the state Supreme Court who was unhappy with the decision to approve the extension. The first 120 time frame was the decision of Wecht and he felt that legislators had plenty of time to make a decision to change the local share assessment. Wecht felt that legislators lacked the political will to make a decision.

The judge also stated that the Senate had ample time to make the necessary changes during the previous deadline and they should be loath to allow the law that has been ruled unconstitutional to remain in place.

So now, legislators will have to make a decision as to the local share tax and hopefully within the 120 day time frame. Will this time frame be enough for lawmakers to make a decision? It might be a good idea to just consider this element of gaming instead of trying to combine the levy tax with some other gambling expansion as that tactic failed in the past. The Senate and House must act now to save the money needed for communities and show the State Supreme Court that they can make the right move to help the state.