Pennsylvania’s highest court upheld the Pennsylvania Gaming Control Board’s (PGCB) decision to award a Category 4 slot machine license to Ira Lubert’s SC Gaming (SCG). The ruling clears the way for construction to begin on Lubert’s satellite casino—in partnership with Bally’s Corporation—in State College, PA. The license also has implications for Pennsylvania’s online sports betting market, making room for one more skin, which will likely go to Bally’s if it wants it.
After nearly four years of legal maneuvering, on July 17, the Pennsylvania Supreme Court (PSC) ruled unanimously in favor of the PGCB’s 2020 decision. Unless it appeals to a higher court, the ruling ends Stadium Casino‘s challenge that claimed Lubert’s licensing bid was invalid. Besides the Lubert/SCG application, Stadium was the only other company vying for Pennsylvania’s 5th and final mini-casino license.
With the legal case over, PGCB communications director Doug Harbach told Play Pennsylvania‘s Corey Sharp on Monday that the Board’s role now shifts to oversight.
SC Gaming can proceed with the project unless there is another appeal to a higher court. The Board’s role now is to work with SC Gaming on the development of the project in following regulations and to monitor the process through the point of when they are prepared to hold test sessions and open to the public.
While many welcome the ruling alongside the PGCB, it dealt a blow to community members against a casino opening in Centre County. Nearly 3,300 people signed two petitions (one online) against the project, citing negative impacts on local businesses and increased crime and gambling addiction.
Supreme Court Affirms PGCB Licensing
Stadium, a subsidiary of Baltimore-based Cordish Companies, contested the PGCB’s decision to award Lubert the license over claims of inappropriate funding sources.
Specifically, Stadium argued that Lubert traded ownership interests in SCG for contributions to his $10 million bid, which he disguised as debt.
This action, Stadium claimed, amounted to Lubert acting as a “Trojan horse for hire.” This deception, Stadium said, gave ineligible individuals and entities access to a Category 4 slot license. As a result, Stadium said the PGCB should have awarded it the permit. At the very least, they argued the PGCB should have held a new licensing auction.
During the court’s review, it considered whether the PGCB overstepped its authority and defied the requirements of the Gaming Act when issuing the license.
The court’s ruling, penned by Justice Christine Donohue, noted that Stadium’s legal argument centered around Section 1305.2(c) of the Act, which outlines procedures and processes for licensing auctions.
The court, however, disagreed with Stadium’s position. Instead, it concluded that the provision:
Only defines the Board’s conduct in connection with Category 4 slot machine license auctions, not its competency to preside over slot machine auctions, application and licensing proceedings. We therefore affirm the Board’s determination and dismiss the action pending in the Commonwealth Court, 249 MD 2021, as moot.
College Township Hopes Casino Revitalizes Region
Following the court’s ruling, construction on the proposed $120 million satellite mini-casino can begin. Precisely when those behind the project plan to break ground remains undetermined, although its expected details will follow in the coming weeks.
Centre Daily Times (CDT) reported that College Township‘s assistant township manager, Mike Bloom, said construction should take about a year once it starts. College Township hosts the struggling Nittany Mall, the future home of the new mini-casino.
As Bloom told CDT, the township hopes the casino will stabilize the mall, revitalize the region, and create new local jobs.
College Township is pleased that the Pennsylvania Supreme Court ruling ends this period of uncertainty on whether or not the casino project can proceed.
When complete, plans indicate the mini-casino will offer 750 slot machines, 30 table games, and a retail sportsbook. Additional amenities include a sports-themed restaurant and bar, a mall-style food court, and a performance space for live music and other special events. Estimates say the 24/7 non-smoking casino will support full-time equivalent employment for 350 people.
Further, estimates given in early 2023 project that construction of the casino will have a one-time economic benefit of more than $61 million.
Additionally, officials previously told CDT that the township and the county would each receive 2% of gross slot machine revenue and 1% of table games. According to a consultant, this will likely amount to about $1.6 million in revenue during the casino’s first year of operation.
As noted, for Lubert’s partner, Bally’s, the casino will open direct market access to Pennsylvania sports betting. For now, Bally’s status as a Qualified Gaming Entity (QGE) relegates its in-state business to online casino-only.
About the Author
