Legal Sportsbook To Open In Pennsylvania In Nov, 2018

Pennsylvania casino gaming will reach a milestone later this month when legal sports betting operations begin at Hollywood Casino, just outside of Philadelphia. Four more casinos are also expected to open sportsbooks before the end of the year.

The road to legal sports betting in PA

Last year, in October, the Pennsylvania legislature passed sweeping new laws concerning casino gaming. The legislation legalized and set regulatory and taxing parameters for daily fantasy sports, online poker, online slots and table games, and perhaps most importantly for the state’s sports-loving citizenry, sports betting.

With the state prohibitions on sports betting lifted, all that was needed was for the federal restrictions to be cleared as well. Earlier this year, the US Supreme Court did just that, repealing the Professional and Amateur  Sports Protection Act which had given Nevada a de facto monopoly on sports betting in the country since it’s inception in 1992.

With the legal restrictions lifted, casinos now had to navigate the rules set on sports betting by the Pennsylvania Gaming Control Board (PGCB). Operators who wanted a bite of the shiny new apple that is legal sports betting had to first pony up $10 million for a license and submit an application to the board. They also had to be willing to suffer the 36% tax rate that will be levied on sports betting revenues.

These hefty fees and taxes seem to have chilled some casino operators’ exuberance to enter the market. Of the thirteen land-based state casinos who are eligible, only five have applied so far. However, all five that have taken the plunge have also been approved by the PGCB.

The first should begin taking sports bets in just a few weeks. The rest are expected to be up and running by years end.

Waiting for the PGCB to give the nod

While all five of the applying casinos have had their licenses approved by the PGCB, it has been somewhat unclear when they would be officially green-lit to begin sportsbook operations. That situation became more clear this Wednesday when it was announced that PGCB Executive Director Kevin O’Toole had been given the power to grant that final approval himself.

This speeds things up quite a bit. Rather than wait for the next PGCB meeting on November 28, O’Toole has the flexibility to examine each operator for their readiness to open and give the green-light on a case-by-case basis. Part of this process will involve a heavily scrutinized test opening to ensure that each casino runs its book smoothly, fairly, and follows all pertinent regulations.

As PGCB spokesman Doug Harbach said in an email, this “is a normal process we undertake to have those in authority, such as (O’Toole) and likely a couple Board members, be involved in the testing.”

“We have done this over the years for the opening of a casino in which there have been full test nights, and when table games launched we also had test periods that were observed and those with authority ‘signed  off’ on the readiness to offer to the public. We will have similar test periods for sports wagering and expect to announce the first of those soon.”

The five casinos approved to operate a sportsbook in Pennsylvania:

For the moment, there are only five players in the legal PA sportsbook market. They are:

Each of these casinos is set to begin sportsbook operations very soon, but each has interesting and specific timing, location, partnership, and technical variables that differentiate them. Let’s take a deeper look at each.

Hollywood Casino

As mentioned above, Hollywood Casino is expected to begin taking bets later this month.

Hollywood is partnering with UK sports betting giant William Hill whose US operations division was granted a conditional license to operate in Pennsylvania this Wednesday. Getting the PGCB to approve their technical partner(s) is a major hurdle most casinos will face in the race to begin taking sports bets. Having William Hill already approved is what gives Hollywood Casino the lead in the race to open.

All that remains is for Hollywood Casino to tick off a few housekeeping operational items mandated by the PGCB before opening its doors. All other PGCB sign-offs have been completed. Once a date has been set for their test run, Hollywood Casino will have earned the distinction of being the first legal casino sportsbook to operate in the state of Pennsylvania.

Parx Casino

Parx had initially planned for a November launch as well, but they were tripped up by a slight snag. They have chosen Kambi Group to be their sports betting partner but Kambi has yet to receive operational approval from the PGCB. As of now, their status is listed as “pending”.

In their latest release, Parx officials said:

“Sports betting will begin on property in the next few months (date TBD pending PGCB approval) at a temporary sportsbook in the former 360 Bar space.”

In addition to opening up a temporary book on the former site of the 360 Bar, Parx is also building an ambitious $10 million expansion project they have named Parx Sportsbook which will open “sometime in 2019.” Parx officials also announced that they will “also extend sports betting to the Parx Turf Clubs in South Philadelphia and Valley Forge soon after Parx Sportsbook launches.”

Said Matthew Cullen, Senior VP of Interactive Gaming and Sports:

“Parx aims to offer the absolute best of all types of legalized gaming for our current and new customers. Sports betting is the next evolution of how we can achieve this goal. We will build the best sportsbook in the country — and set the industry standard for this fast growing arena.”

Rivers Casino and SugarHouse Casino

Rivers Casino in Pittsburgh and SugarHouse Casino in Philadelphia are both owned and operated by Rush Street Gaming. Rush Street has announced that they are aiming for a December 1, 2018 launch date for temporary versions of both these sportsbooks with more robust and permanent facilities to follow in the spring of 2019.

Both properties will be using Kambi Group to operate their sportsbooks. This is expected, as Rush Street also uses Kambi to run its mobile betting operations in New Jersey. As such, Rush Street must wait (along with Parx) for Kambi Group to be approved by the PGCB to operate in the state. As of now, Kambi’s application status is listed as “pending”.

Harrah’s Philadelphia

Harrah’s timeline to sportsbook operations in Pennsylvania is less clear than that of its four competitors. While the other casinos offered at least the broad strokes of a timeline in their applications, Harrah’s omitted one entirely.

Since then, Harrah’s has declared its intentions to open online casino gaming and sports betting in the first quarter of 2019 – possibly as soon as 90 days from now. Harrah’s won’t be bothering with any temporary facility and will instead move directly to building out a permanent structure on site. It has been surmised that since Harrah’s already has a good-sized racebook, perhaps they will simply do a slight expansion and remodel rather than a separate (and more costly) construction project.

Harrah’s might lag behind their sportsbook competition as far as their opening date is concerned, but when they hit the market, they will have a lot of experience on their side. Harrah’s is owned by Caesars Entertainment who already operates both retail and mobile sports betting in New Jersey. They also have a strong presence in Mississippi and are longtime successful operators of sportsbooks in Nevada.

When will mobile/online sports bets be available?

The $10 million license that allows casinos to take sports bets at a physical location also allows for mobile sports betting. Unfortunately, Pennsylvanians will have to wait until 2019 for such products to arrive. The PGCB has made clear that PA casinos will have to demonstrate that their retail sportsbook operations are solid before getting the nod to roll out mobile features.

Once the new year has arrived, we can be sure that casino operators will move quickly into this lucrative slice of the sports betting market.

William Hill (partnered with Hollywood Casino) already operates mobile sportsbooks in New Jersey and Nevada and will certainly do so in Pennsylvania as quickly as possible. Parx Casino has announced an upcoming app “complete with live in-game betting” sometime in 2019. Rush Street Gaming’s two properties (Rivers and SugarHouse) have similarly announced an “online solution” that will be ready early in 2019.

Harrah’s hasn’t been as vociferous on the matter, emphasizing that it will focus full attention on opening it’s retail sportsbook. Once it does so, however, it is highly likely they will be expanding to mobile betting to match the actions of its competitors.

 

 

Author: Adam Haman