Pennsylvania to Revive Mini-Casino Auctions

Gaming regulators in Pennsylvania, seeking to boost state gaming taxes ravaged by more than two months of shutdown due to the Covid-19 pandemic, announced they will again try to auction off the remaining five licenses for satellite mini-casinos.

The satellite casinos, limited to 750 slot machines and 40 table games, were created under the state’s 2017 gaming expansion law. The law authorized 10 of the mini-casinos. Classified as Category 4 casinos, they are to be tied to the licenses of current Category 1 racetrack casinos and Category 2 stand-alone casinos. (small Category 3 resort casinos were excluded.)

The Pennsylvania Gaming Control Board has set September 2 as the date for the first new auction. The minimum bid is $7.5 million.

After receiving bids in the first five Category 4 auctions in 2018, there were no bids in two consecutive auctions. The successful bids became smaller as it became clear fewer properties were bidding—from Penn National’s initial bid of more than $50 million to the last bid of $1 over the $7.5 million minimum.

Because the 2017 law set exclusion zones around existing casinos, none of the state’s urban areas will qualify for new mini-casinos. New bids will necessarily be confined to rural areas with no current casinos.

Of the five mini-casino licenses granted, two are under construction—Penn National’s casino near Reading and Stadium Casino’s (Cordish Companies) casino in Westmoreland County. Both of those projects are in vacant former anchor stores in retail malls.

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