Pennsylvania took an important step towards legalizing online poker on Tuesday when HB 2150 passed the state House of Representatives.
The bill now moves to the state Senate committee with the eventual goal of a floor vote.
This is the second bill in 2016 to pass at least one legislative chamber but many feel that this time, we will finally see a fourth state regulate online poker.
Omnibus Bill Will Regulate Online Gambling and Daily Fantasy Sports
Online gambling was added to HB 2150 earlier in the month after lawmakers removed the inclusion of video gaming terminals.
Once VGTs were removed, lawmakers easily passed the amendment and the bill passed through the House Appropriations Committee last week.
HB 2150 is an omnibus bill that will cover online poker, general casino iGaming and Daily Fantasy Sports.
The bill originally started as simply a DFS regulation measure but with the ongoing state budget crisis, lawmakers were able to add iGaming as a measure to help narrow the budget gap.
What's Next for HB 2150?
With the passage of HB 2150 in the PA House, the bill heads over to Senate Committee and should it pass through, it will head to a Senate floor vote.
However, don't consider this bill a slam-dunk as there are reportedly still some concerns from select lawmakers over revenue and regulatory issues.
One such potential issue may be tax rates. HB 2150 calls for a 14% tax rate for the state along with a 2% local tax.
Some lawmakers last year were calling for a rate as high as 54%, one that would effectively kill any regulatory efforts.
There are also some concerns over how effectively iGaming can be regulated, the technology needed for geolocation and player identification and the manpower needed to achieve regulatory goals.
Even if the bill passes, it appears that Governor Tom Wolf has yet to make up his mind about signing. He has shown a willingness to work with lawmakers over the issue but only if it is a part of a larger plan to solve the state budget.
Unlikely that Potential Revenue Can Be Overlooked
If budget concerns are a major factor in convincing Gov. Wolf to sign HB 2150, the odds of passing may be high.
According to estimates, regulated iGaming will bring in between $90 and $120 million the first year in licensing fees alone.
Estimates on revenue vary between $165 and $250 million with between $35 and $45 million of that going to the state in the form of taxes.
That's a maximum of $165 million that could be going to the state in Year 1, and that's not even including estimates related to DFS.
With the state in desperate need of raising revenue for the budget, this seems like a key component of such fundraising.
As such, we are confident that HB 2150 will receive strong consideration in the weeks ahead and put the odds at around 80% for its passing this year.