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Gambling on back burner as Pa. pols head to N.Y. soiree

HARRISBURG - Lawmakers departed yesterday for the annual Pennsylvania Society weekend of politicking and socializing in New York City, leaving unfinished business with broad statewide implications.

HARRISBURG - Lawmakers departed yesterday for the annual Pennsylvania Society weekend of politicking and socializing in New York City, leaving unfinished business with broad statewide implications.

After days of closed-door vote wrangling and one spirited late-night debate, the long-promised bill to add table games at slots parlors - and hundreds of millions of dollars to state coffers - failed to reach a floor vote.

While offering reasons for the holdup, lawmakers in the House and Senate still voiced confidence yesterday that they would pass the legislation before recessing for the holidays on Wednesday.

Of immediate importance, proponents say, is that the bill would provide $250 million in revenue that the state needs to balance the current budget and to send delayed aid to state-related universities.

Without that money, some universities have threatened midterm tuition hikes. Gov. Rendell has said he might consider layoffs of state workers. And unemployed workers counting on jobs, and communities counting on casino revenue, would have to wait.

After repeatedly setting dates for promised action, the effort was derailed this week when House Democratic leaders admitted there were not enough pro-gaming votes in the Capitol and delayed an expected vote.

The proposal to add table games to help bolster revenue was embraced by Democratic and Republican lawmakers as they were finalizing the overdue state budget. After the budget was signed Oct. 9, lawmakers said they would pass the gaming legislation.

In addition, they agreed to authorize $730 million to fund state-related colleges. Under a constitutional provision, their funding is considered separately from the general budget.

Within weeks, the Senate passed two gaming bills - one addressing reforms and another authorizing table games. The Senate bill set the casino license fee at $15 million and the tax rate at 12 percent, plus 2 percent to local governments.

But during the last two months in the House, the gaming issue became messy as the proposed bill grew.

At the behest of the Senate, for instance, the House dropped a provision that would have authorized two additional resort casino licenses. Senate Republican leaders said they did not want to add more licenses when only nine of the 12 licensed slots parlors are up and running.

A provision to extend credit to gamblers, which remains in the bill, has come under fierce fire from anti-gambling activists, who say it takes advantage of those with addiction problems.

Still at issue for some House Democrats is the amount of a one-time license fee ($16.5 million) and the taxes (14 percent for state and 1 percent each for municipalities and counties where casinos are located) being considered on table-game revenue.

Rendell - while discouraged about the holdup - has said he would sign a bill based on those figures.

But several rank-and-file House Democrats said the licensing fee and tax rate should be higher and amount to "giving away" licenses to a multibillion-dollar industry.

"I fear it's too low," said Rep. Steve Santarsiero (D., Bucks) about the tax rate, compared with West Virginia's 35 percent. "We ought to take the time and do it right."

Rep. Paul Clymer (R., Bucks), one of the Capitol's most fervent gambling foes, said the tax rate and the fee would be "giving away the store" to casino operators. "Santa Claus comes early to Harrisburg if we adopt those figures," Clymer said yesterday. "Absolutely."

New Jersey's combined tax rate on table games and slots is 9.25 percent. Delaware's proposed rate is 29.4 percent.

Bob Green - chairman of Greenwood Racing Inc., which owns and operates PhiladelphiaPark Casino & Racetrack, the most profitable casino in the state - said yesterday that a tax rate higher than 16 percent would hurt Pennsylvania's ability to be competitive in the region.

"The basis of this bill started out as a jobs and capital-investment bill," he said. "If you want that, then you have to have a realistic tax rate."

Without the full support of the House Democratic caucus, gambling supporters would almost certainly need Republican votes to get the 102 votes needed.

Steve Miskin, spokesman for House Minority Leader Sam Smith (R., Jefferson), said that the bill would likely get at least several dozen GOP votes, but that Republicans would continue to fight for changes they'd like to see in the bill, such as eliminating gambling-reform language with the idea of putting it in a separate bill.

Pennsylvania casino operators are also growing increasingly concerned about the delay.

Each passing month, they say, puts them at a competitive disadvantage with surrounding states that have table games, like New Jersey, or are planning to add them soon, such as Delaware, which is expected to offer blackjack and roulette and other games this spring.

"The longer it takes for the legislation to pass, the longer it will be for us to be up and running, because we have to have regulations in place and employ people," said Green, whose PhiladelphiaPark Casino moves into an expanded facility on Friday.

The Pennsylvania Gaming Control Board said it would take from six to nine months to install table games at the state's nine existing casinos from the day Rendell signs a bill.

The Senate, for now, is the chamber in waiting.

Erik Arneson, spokesman for Senate Majority Leader Dominic Pileggi (R., Delaware), said he did not anticipate major problems with the bill as it stands and thinks that the chamber could vote to approve it in time for the House to give final approval by Wednesday.

House Majority Leader Todd Eachus (D., Luzerne), in an interview yesterday, pledged a vote when the chamber returns to work on Monday.

"Every bill that's gone to the floor since we started in the majority in 2007, we've won," he said before heading off to the Pennsylvania Society event. "We are going to get it done."