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Pennsylvania Slots Revenues Surge in July Report

Posted on August 5th, 2010

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Pennsylvania casinos took in a combined $211 million gross revenue from slots machines in July—a record 17.8 percent increase from the same period last year. Leading the top gainers are three Philadelphia casinos. Parx generated $36.7 million in slots revenue, a 19 percent increase from July 2009. Harrah’s Chester ranked next with $27.3 million, up 0.07 percent, while Sands followed at the third place with $24.5 million, up 25 percent year on year performance. The three operators contributed a combined 42 percent in gross revenue for the month of July. Not including the 3,000 slots located at Rivers Casino in Pittsburgh, which did not operate a full year, state slot revenues for the remaining 8 casinos were up by an average of 5.26 percent. Gmbling revenue is expected to go up some more when revenues from table games are factored in.

Table game returns are counted manually. But reports, though still early at this point, have pointed to a $1.6 million collection from craps, blackjack and all the other table games. In fact, table games have raised casino patronage and served as a huge factor for the sudden surge in slot machines revenue. Table games debuted in Pennsylvania last month. “Table games have bumped up slot machine play, too,” notes Kevin O’Toole, executive director of the Pensylvania Gaming Control Board. “It is too early to gauge a trend, but Pennsylvania casinos have indicated they have experienced a significant increase in the number of visitors since table games were rolled out in mid-July,” he said Tuesday.

Michael Leven, president and chief operating officer of Las Vegas Sands Corp., Sands Bethlehem’s parent company, said that he was very happy with the casino’s early returns from table games. “The addition of poker, blackjack, roulette and craps in our gambling offerings has increased visitor turnout, slots revenue, visibility and food and beverage sales”, he said. In a time of recession, the money earned from casinos is very much needed, says Governor Edward Rendell, who was a staunch advocate for the legalization of slot gambling in the state in 2003. With a 55 percent tax on slots machine revenues, the state receives $116,079, 631 in revenue for July. This represents about $3.74 million tax revenue each day. “What has caused this explosion is that we’ve captured 90 percent of what has been leaving the state. One million Pennsylvanians have been gambling in other states, and we’ve captured that market.” Governor Rendell said of the July report. “We’re off the charts. We’re now getting more revenue from gambling than Nevada, New Jersey, and Delaware, and doing it during a recession. It’s stunning.”

The state plans to spend most of the income on property tax relief. “The rest goes to such things as increased budget for the horse racing industry, local governments were casinos are located, and grants for fire companies”, Governor Rendell reports. But the rise in gambling traffic in Pennsylvania means more trouble for the casinos in New Jerseys. A fourth of the total customers at the csinos in New Jersey were coming from Pensylvania. With the expansion of gambling available, gamblers are now playing closer to home. For casinos in Atlantic City, which depend on table games for 30 percent of its revenue, the arrival of poker and blackjack at those casinos in Pennsylvania has taken a huge dent on their operation.

Previously, state senator and former New Jersey governor, Richard Codey, expressed frustration on the arrival of tables in Pennsylvanian casinos bordering so close to New Jersey. “Why are we giving away hundreds of millions of dollars to other states? There is no logical reason not to do slots in the Meadowlands.” he was quoted before. He was a firm supporter of allowing slots in the meadowlands and was one of those who pushed for Governor Christie to act to such an end . Governor Chris Christie earlier bared plans for a state takeover on Atlantic City’s casinos in an effort to resuscitate life to its dying casinos.