For Philadelphians, legal sports betting just got closer to home.
SugarHouse Casino on Thursday became the first Philadelphia-area casino to launch sports betting, accepting its first wagers under a two-day test period supervised by the Pennsylvania Gaming Control Board. If operations meet approval, the casino can start regular sports-betting hours Saturday.
SugarHouse and an affiliated property, the Rivers Casino in Pittsburgh, both owned by Rush Street Gaming LLC, became the second and third Pennsylvania casinos to offer sports betting. Hollywood Casino at Penn National Race Course near Hershey opened the state’s first sportsbook last month.
“We’re very excited to be the first sportsbook in Philadelphia,” said Cheryl Duhon, the general manager of SugarHouse.
The first bets were placed by six VIP bettors recruited by SugarHouse, including Kevin Konieczny, a Kensington resident wearing a Flyers jacket, who wagered $200 on the hometown hockey team in Friday’s game against the Oilers in Edmonton. Nicole Stabile, a seasoned South Philadelphia sports bettor, bet two C-notes on the underdog Los Angeles Lakers to lead the Houston Rockets at halftime in Thursday night NBA action.
About two dozen regular bettors stood patiently in line waiting for their first bets, greeted by two young women dressed in snug referee outfits that might have drawn a penalty flag from the PC police. Alan Pipkin, a Manayunk construction worker who said he “snuck away from the job site,” clutched three $20 bills that he intended to wager in several different bets on the favored Kansas City Chiefs in Thursday night’s NFL game against the Chargers.
Since the U.S. Supreme Court in May legalized sports wagering outside Nevada, eight states have approved sports betting. New Jersey, which brought the legal action that led to the court’s ruling, reported this week that bettors wagered $331 million in November, up 27 percent from October.
In less than six months, sports bettors have wagered $928 million in New Jersey and generated $73.8 million in revenue for casinos and racetracks, though some experts say the growth may slow down as sports betting takes root in neighboring states. Pennsylvania’s launch may provide the first signals of erosion if sports-betting volumes begin to soften in Atlantic City.
Parx Casino in Bensalem and Harrah’s Philadelphia Casino & Racetrack in Chester have also received sports-betting licenses from the gaming board, and Valley Forge Casino Resort in King of Prussia filed an application last month to become the sixth Pennsylvania casino to offer sports wagering.
For casinos, sports betting is a low-margin business that generates a fraction of the profits produced by slot machines. But casino executives regard it as an additional amenity that will attract new patrons who might eat and drink in the casino, and also bet on traditional casino games during breaks from the visual onslaught of television screens in the sportsbook. “If you want to play blackjack during halftime, you can,” said Evan Davis, the SugarHouse general counsel.
Taxing authorities anticipate that legalized sports betting will take market share from the estimated $150 billion now wagered mostly through illegal bookmaking operations. Pennsylvania has set the highest tax rate in the nation on sports betting, a levy of 36 percent on gross gaming revenue — the amount the casinos retain after paying winners. Pennsylvania’s tax rate is four times higher than New Jersey’s.
Pennsylvania’s $10 million sports-betting certificate, available to any of the state’s 13 licensed casinos, also includes the right to offer interactive sports wagering. Casinos say that online sports wagering is likely to take several more months of review by state regulators before it launches.
“The regulators want to let the dust clear with the land-based piece before starting online sports betting sometime next year,” said Duhon, the SugarHouse GM. She said she hopes the mobile betting, which will allow anybody in Pennsylvania to bet on the internet, would be active in the first quarter of 2019.
SugarHouse initially opened its sportsbook in a small, temporary location, an 1,800-square-foot lounge near the casino’s north entrance that contains seating for about 70 people. The permanent location will be built on the central gaming floor in an area now occupied by the Lucky Red Lounge.