Experts: Betting on Pennsylvania gaming expansion risky

While Westmoreland County officials hope to cash in as Pennsylvania adds up to 10 mini casinos, some industry observers doubt the plan to expand gambling will generate the tax revenue state lawmakers are betting on to balance the budget.

“These satellite casinos will likely cannibalize business from the current operations, depending on where they are located,” said Colin Mansfield, a gaming analyst with Fitch Ratings, the New York-based credit rating agency.

Gov. Tom Wolf last month signed into law a gambling expansion bill that allows new casinos that can house between 300 and 750 slot machines and, eventually, up to 40 table games. State officials believe the new facilities — along with internet gambling, fantasy sports betting and allowing video gaming terminals at truck stops — could bring in $200 million or more in the first year through license fees and taxes to help cover a projected $2.2 billion budget shortfall.

Pennsylvania's 12 existing casinos — including Rivers Casino in Pittsburgh, The Meadows Racetrack and Casino in Washington County and Lady Luck Casino Nemacolin in Fayette County — in 2016 topped $3 billion in gambling revenue for the sixth consecutive year, which ranked second only to Nevada.

Under the new law, outside casinos cannot open a satellite facility within 25 miles of an existing casino. Existing casinos could bid to build a satellite facility within their exclusionary zone.

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