The deadline for a fix to be put in place in regards to the Pennsylvania casino host tax is this Friday. Will the deadline be missed?
For months now, legislators in Pennsylvania have been dealing with several issues as far as gaming is concerned. From expanding into the realm of online casino game play to VGTs and airport gaming, the lawmakers of Pennsylvania have had their hands full. On top of new expansions, the legislators have also been trying to repair the casino host tax, a tax that was deemed unconstitutional in September by the state Supreme Court. After an extension, lawmakers have until this Friday to find a solution or the much-needed money goes away.
A Little Back Story
The casino host tax first became a major problem in September 2016. The state Supreme Court ruled in favor of the Mount Airy Casino in a fight against the tax. Basically, gaming venues were paying 2% of their slot gaming or $10 million in a host casino tax. The higher amount of the two would be paid to the host community or municipalities of the area in which the casino was located. Mount Airy felt this tax was unfair to smaller venues like themselves and the court agreed. Lawmakers were given until January 26th to come up with a solution.
Fast forward to January and no solution was in sight. Lawmakers asked for yet another extension, this time given until the 26th of May, which just so happens to be this Friday. It seems lawmakers are going to miss this deadline as well which means millions of dollars will not be contributed to the state, with many programs and groups affected.
What Happens Next
According to recent reports, lawmakers are ‘close’ to a fix. So basically we will have to wait and see if a bill is created and passed within the week or if the tax will remain in limbo. Two senators of the state feel that the deadline will be missed and the host fees will be cut off. However, they do feel that this will not be a problem as many municipalities are not due a payment until July or August.
Some gaming venues have agreed to pay their fee even if they don’t have to according to the law. These fees go to help the local community, like the police and fire departments, senior citizens and children’s programs depending on the area. And while some plan on paying up, the Sands Casino Resort Bethlehem still has not pledged to do so which has upset local officials.
The communities where the casinos lie are going to be devastated if they do not have access to the host fee monies. Since casinos first launched in the state almost ten years ago, the communities have grown accustomed to the money. As much as $142 million is put back into the local communities due to the tax each year.
What are the Fees Used for?
The purpose of the casino host tax was to pay fees to the local community based on the fact that the communities had to deal with the adverse effects from the gaming venues. Take Lehigh Valley for example. They see money divided into several areas from the Sands with the money used to pay for emergency response service. Without this money, this service will suffer losses. In Bethlehem, the last fiscal year produced $8.8 million in fees which was used to create a large portion of the city’s budget.
Overall, the money is needed and lawmakers need to get it together and create a plan of action to see the fee paid, in a fair way for all. We shall see if a fix is created or if the communities lose out for some time on these much-needed funds.