The $32 billion Pennsylvania budget that Governor Tom Wolf (D) allowed to pass without his signature in late June is underfunded by $2.2 billion, and it now appears the odds are fairly strong that some sort of gaming expansion measure will be used to partially cover the shortfall.

Pennsylvania budget gaming expansion

Democratic Governor Tom Wolf and the Republican-led House and Senate are close to a Pennsylvania budget deal that assumes new tax revenue from gaming expansion and licensing fees. (Image: Chris Knight/Associated Press)

State lawmakers are back in the Harrisburg capital city this week to find a way to fund the fiscal blueprint the legislature co-developed over the summer. The leaders of the Republican-controlled House of Republicans and Senate are reportedly working behind closed doors with their Democratic colleagues to reach a deal.

While nothing has officially been confirmed, sources tell local media outlets that the authorization of as many as 10 so-called “mini-casinos” in rural areas will be included in the funding package. Online poker and interactive slot games will also be legalized, and video gaming terminals will be permitted inside certain truck stops.

That’s according to City & State, a digital news outlet that covers Pennsylvania government.

“There is no deal until there are votes,” Stephen Miskin, the spokesman for House Speaker Mike Turzai, told City & State. “The details are still being worked out and we hope to have something to share with the caucus next week.”

Authorizing 10 small casinos, online gaming, and truck stop terminals won’t generate $2.2 billion in tax revenue for the state. That’s why, in addition to gaming expansion, state leaders are expected to borrow a lump sum that comes each year through the tobacco industry’s Master Settlement Agreement.

Complete details on the budget measure, and a possible vote, are expected next week.

Defining Rural

The small gaming venues will reportedly be required to be built in rural areas far away from Pennsylvania’s current 12 land-based commercial casinos. That of course means Pennsylvania’s two largest cities, Philadelphia and Pittsburgh, won’t be able to snag another gambling facility.

Aside from those two metropolises, which are respectively home to 1.6 million and 304,000 people, much of Pennsylvania could be considered rural. Though Pennsylvania is the sixth most populated state in the US, it’s made up of regional towns that mix the countryside with small cities.

Bethlehem, for instance, is home to about 75,000 people. It’s also the site of Sands Bethlehem, the second richest gaming generator in the state.

Owned by Las Vegas Sands billionaire Sheldon Adelson, the company was reportedly shopping the property recently due to the ongoing gaming expansion talks taking place in Harrisburg. MGM was thought to be interested, but a deal never materialized.

Online Gaming

Should Pennsylvania additionally legalize online poker and iSlot play, it would become just the fourth state in America to do so. Nevada, Delaware, and New Jersey all offer internet poker, but no jurisdiction has joined them since 2013.

Inadequate liquidity has been blamed for poor results stemming from legalized online poker. US operators have been looking for a more populated state to join the fray, and they get just that with the Keystone State.

Networks such as PokerStars and 888 will hope Pennsylvania will enter into interstate compacts to share players across state borders.