Pennsylvania Accepts Its First Legal Sports Bets

Pennsylvania map

Pennsylvania’s Hollywood Casino’s sportsbook is now open for business, accepting the state’s first legal sports bets. The process of legalization has been long and drawn out, but the day has finally come.

Hollywood Casino at the Penn National Racetrack in Grantville began offering sports betting without any announcement and not much hype on November 15 at 3 pm. For the first two days, the facility went through a trial period from the Pennsylvania Gaming Control Board. After everything was found to be operating appropriately, the casino had its official launch on November 17.

Pennsylvania has now joined Nevada, Delaware, New Jersey, West Virginia, and Mississippi as states where full sports betting legalization is in place and sportsbooks are operating.

A single tribal casino in New Mexico is exploiting a legal loophole to offer sports betting also. Many other states are waiting to open sportsbooks or to push through their own legalization bills in 2019.

Hollywood Casino’s offering

The Hollywood Casino’s sports betting operation is on the second floor of the building. More than 30 televisions allow bettors to follow their wagers. Sports bets must be placed in person through a teller at the counter.

There are expectations that mobile sports betting will arrive early in 2019. Hollywood Casinos will likely benefit from opening its sportsbook ahead of its competitors in the state.

The Sugar House Casino and Parx Casino in Philadelphia and Pittsburgh’s Rivers Casino did not get this honor. Gamblers can place sports bets at Hollywood Casino from 11 am until midnight on weekdays and from 10 am until midnight at the weekend.

Getting to sports betting legalization

Getting sports betting legalized in Pennsylvania was a long journey. There were many objections and disagreements along the way, but sports betting and online gambling finally became legal in October 2017.

That was done with the idea that the Supreme Court would end the federal ban the following year. Pennsylvania is behind only Nevada in gambling revenue. Therefore, the legalization of sports betting was a natural evolution for the state.

However, several delays occurred along the way. A dispute between the state’s authorities and casinos led to a lawsuit being filed by a group of the casinos against the state’s iLottery platform.

There was then a drawn-out application process for the new sports betting licenses. It took many months before the applicants had their cases heard and ruled upon.

Will legalization be a success?

Eventually, some gaming facilities got the go-ahead in early October to open their sportsbooks. Hollywood Casino and Parx Casino and Racing were the first to receive the licenses.

Both had applied back in early August, so it took about two months for them to get the green light. A $10m (£7.8m) license fee is the payment for having a sportsbook. A hefty tax of 36% on sports betting revenues is in place.

This, of course, is a massive tax rate that dwarfs the rates in other states. Many believe this is a deterrent to operators from applying for sports betting licenses. Breaking down the tax obligations, there is a 34% gross revenue tax, a 2% tax for local share assessment, and a 0.25% federal excise tax on the handle.

By comparison, New Jersey has a $100,000 licensing fee, an 8.5% gross revenue tax on offline sports betting, and a 13% tax on online bets.

With 13 sports betting licenses up for grabs in Pennsylvania, only a handful of operators have applied. Therefore, for those who have high hopes about Pennsylvania’s future role in the sports betting space, there are a lot of barriers to be overcome. Other states will be watching closely to see what happens with the high license fee and tax rate in the Keystone State.

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