Pennsylvania’s Regulator Allows Casinos to Reduce Their Slots Count

Several casinos in Pennsylvania, including the Hollywood Casino at Penn National Race Course and the Hollywood Casino at the Meadows, will be allowed to reduce their total number of slot machines as the state’s Gaming Control Board is seeking to tackle unregulated and untaxed “skill games” machines.

Adrian King Speaks About the Negative Impact of Unregulated Machines

Adrian King from the law firm Ballad Spahr participated in November 10’s meeting of the Pennsylvania regulator as a representative of the Mountainview Thoroughbred Racing Association. He justified the slot machine reduction with a number of factors.

King pointed out that the post-COVID-19 situation and the growing popularity of online gaming have reduced the need for slot machines. He added the unregulated skill games machines were a big factor in the decision to reduce the overall number of slot machines.

King shed light on the proliferation of the so-called distributed gaming where various non-casino establishments get their own slot machines. The Mountainview Thoroughbred Racing Association representative said that this is a serious problem for the industry as people would always prefer to avoid traveling to the casino. This, in turn, has caused the gambling industry to see a $200 million decrease in the gross gaming revenue between 2013 and 2019. Furthermore, this also damages the Commonwealth which can’t collect its 52% tax on legal casino slots.

King continued that the unregulated skill games have a plethora of other detriments to the industry. To list a few, he mentioned that such machines often blend in with the regulated ones, that they often allow minors to play and also spark more problem gambling and gambling-related crime. This whole lack of regulation leads to a decline the public trust in the industry.

Last but not least, regulated casinos provide a safe gaming environment that unregulated machines cannot ensure.

Two Notable Gaming Venues Reduce Slots

The Hollywood Casino at Penn National Race Course and the Hollywood Casino at The Meadows are two notable examples of casinos that might have their slot machines reduced. The reduction is planned in such a way as to not damage the venues’ income or to endanger the employees’ jobs. The removal will prioritize older machines that have become harder to repair.

The cut in machine numbers will take into account the number of visitors in order to avoid resulting in scarcity. Speaking in numbers, the Hollywood Casino at PNRC will be removing 191 of its 1,927 slot machines. The Hollywood Casino at the Meadows, in turn, will remove 317 of its 2,323 machines.

As an example of how unregulated gambling has affected the industry, the Hollywood Casino at the Meadows had a gross terminal peak of $275 million in 2009 which plummeted to a mere $100 million in 2020.

The Hollywood Casino at Penn National Race Course, on the other hand, used to have peak gross terminal revenue of $253 million in 2021, which sunk to $125 million in a decade.

The latter venue’s vice president of gaming operations, Mike Mueller, mentioned that as counterintuitive as it may sound, having more slots does not necessarily equal more revenue.

“We want to provide the right number of slots, a comfortable layout, and games people want to play in,” he said.