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Wednesday, June 10, 2015

Regulation needed to protect our kids!


Here's why Pa. needs to legalize online gambling: John Payne and Nick Kotik

PennLive Op-Ed By PennLive Op-Ed The Patriot-News

on May 27, 2015 at 12:30 PM, updated May 29, 2015 at 11:39 AM

By John Payne and Nick Kotik

When Pennsylvania approved casino-style gambling in 2004, the state took advantage of a known, available revenue stream that was being lost to outside entities.

At the time, Pennsylvanians were crossing state lines for New Jersey casinos, and hundreds of millions of dollars in potential taxes and revenue were lost each year.

Something similar can be said about online gaming: it's happening here in our state, but because it is not regulated Pennsylvania loses out on millions of dollars in tax revenue that instead goes into the pockets of offshore illegal gambling websites.

And what's more, because these online games are unlicensed and unregulated, players are exposed to financial risks and abuse. There also are no protections to stop children and other underage players from gaining access, and no protections for problem gamblers .
Read More: Internet gaming is waiting in the wings at the Capitol this budget season

It makes no sense to leave online gaming unregulated, and sit idly while the state loses out on this income and players are unprotected.

That's why we have drafted a bipartisan measure that would regulate and tax the industry.

Pennsylvanians support what we're trying to accomplish with our bill.

A just-released poll of Pennsylvanians commissioned by Caesars Entertainment shows 58 percent of respondents believe online gaming should be strictly regulated which is at the heart of our legislation.

Nearly 66 percent believe online gaming revenue should be taxed and the proceeds used for vital state programs (only 20 percent disagree).

They also say -- 80 percent -- that the state needs to make online sites use new technologies to assure that minors do not have access to online gaming, which is a cornerstone of our legislation; children are left entirely unprotected with the existing black market.

Pennsylvanians likewise support providing protections for problem gamblers: 52 percent of respondents said online gaming operators should be required to use technology that limits losses, deposits and the amount of time an individual can play.

This too is part of our legislation as there are no protections provided today for the vulnerable.

Regulating online gaming is a win/win for Pennsylvanians and the state.

As for the financial boost online gaming would provide, a recent study from a Philadelphia-based economic consulting firm estimated that the newly expanded industry would generate approximately $120 million for Pennsylvania in its first year.

The Legislative Budget and Finance Committee also estimates that online gaming could generate $307 million in revenue for Pennsylvania's casinos, including $113 million in taxes annually.

That kind of money would help to offset the projected budget deficit we face and proposals to levy new taxes on working Pennsylvanians.

This is not a partisan issue; during the past several years a number of bills have been introduced -- by Democrats and Republicans -- to regulate online gaming in order to combat the illegal market that exists. And Internet gaming already is regulated in Nevada, Delaware and New Jersey.
Read More: In new poll, Pennsylvanians support legalizing Internet gaming. How about you?

These states have shown that the technology exists to provide safeguards. This type of gambling is only growing.

Figures released from New Jersey this month show that online gaming revenues have increased 19 percent compared to the first four months last year. Regulating online gaming also helps existing casinos (and the jobs they provide), which means property tax relief for Pennsylvanians.

This is because online gaming attracts a younger adult crowd that's used to blackjack and televised poker tournaments. Gaming sites managed by brick-and-mortar casinos draw players for in-person tournaments -- players who otherwise would never set foot in a casino.

In fact, Penn National Gaming officials have testified at legislative hearings that they believe Internet gaming is vital to evolving and protecting their business -- so much so that the company named a Head of Online Gaming.

Our bill offers the types of strict regulations needed to make online gaming work as it should in our state. The recent poll illustrates that this is something Pennsylvanians want.
Read More: Here's why Intenet gaming is bad for Pennsylvnania (Op-Ed)

Under the legislation, the state Gaming Control Board would establish consumer protections such as allowing customers to set limits on deposits and losses and measures to help problem gamblers.

It also would implement cutting-edge safeguards to bar minors from online gaming sites and ban unlicensed operators, imposing hefty fines on illegal sites.

Enacting this legislation would regulate an industry that is operating without any type of protections right now. It will provide funding for the state and make Pennsylvania casinos more competitive.

Simply put, regulating online gaming is a win/win for Pennsylvanians and the state.

Rep. John Payne, R-Dauphin, is the chairman of the House Gaming Oversight Committee. Rep. Nick Kotik, of Allegheny County, is the panel's ranking Democrat. They are co-sponsoring legislation to legalize Internet gaming in Pennsylvania.