FUMO, ORIE PROPOSE REVISIONS TO GAMING ACT

     HARRISBURG, August 12, 2008 – Two state Senators have developed bipartisan legislation that would make several important amendments to Pennsylvania’s 2004 slot machine gambling law, including prohibiting outside income by Gaming Control Board members, expanding the prohibition on campaign contributions from casino interests, and increasing public disclosure of previously confidential information supplied by license applicants.

     Vince Fumo (D-Philadelphia) and Jane C. Orie (R-Allegheny) plan to introduce the bill in time for it to be considered when the Senate returns to session in September. Fumo was an early supporter of legalizing slot machines and was one of the chief authors of the legislation to do so. Orie opposed the expansion of gambling in the state.

     “We disagreed on the overall public policy merits of the legalizing slots, but we agree now that the experience of the past several years compels us to make changes,” Orie said.

     “The past two years have highlighted several unintentional deficiencies of the existing law. We created a new industry in this state and adopted the best practices that we could find from other states, but the law was not perfect and we can improve upon it,” Fumo said.

     The proposed legislation would make Gaming Control Board members full time, and ineligible for outside income. They are already paid a salary reflective of the full-time nature of the position – $150,000 per year for the chairman and $145,000 for the other six members.

     Fumo and Orie said the intensity and complexity of the work argue for it being a full-time job, and the need to prevent actual or perceived conflicts of interest suggests a need for prohibiting outside employment.

     Another key provision would clarify the limited nature of confidentiality of information about license applicants. Although the existing Gaming Act contains a narrow definition of confidential information, the Board has taken a very broad interpretation of this provision and has deemed all information provided by an applicant to be confidential. This bill would open up all information that is not specifically designated as confidential, such as trade secrets or personal medical and financial data about applicants.

     Fumo and Orie also propose to eliminate the section of the law that gives jurisdiction over all slots license appeals and slots-related zoning appeals directly to the Supreme Court. Intended to expedite appeals that may have delayed the opening of the casinos, it has had the effect of eliminating the important appellate record that is typically created at the Commonwealth Court level.

     Another measure within the bill expands the ban on campaign contributions from licensed casino operators to those who have registered with the Gaming Board as “licensed casino representatives.” This would prevent casino operators from making contributions indirectly through paid lobbyists.

     “All of these provisions would create greater public confidence in Pennsylvania’s Gaming Act and Gaming Control Board,” Orie said. “That confidence has been shaken recently, and we must restore the complete integrity of the process in the public eye.”

     The bill would also require the two casinos licensed for Philadelphia to obtain authorization from the General Assembly, and to compensate the taxpayers of Pennsylvania, for the use of public land before they are allowed to commence gambling operations. Currently, the two licensed casinos plan construction on land that is partially within the river bed of the Delaware River. To date, they have not sought a grant of these riparian rights from the Commonwealth.

     Among the other amendments in the Fumo/Orie proposal, the bill would:

     • require a two-third Senate confirmation of all future members of the Gaming Board.

     • require oral hearings with the right of cross examination for all matters before the Board.
 
     • prevent an applicant from borrowing the initial $50 million license fee and require a surety bond from the licensee when the licensee is also the developer of the project.

     • require disclosure and posting on the Internet of information concerning the true identity of the controlling interest in a gaming facility.

     • require the board to adopt regulations, in addition to those already in place, maintaining the separation of prosecutorial and adjudicatory functions.

     • authorize and encourage the Board to seek the advice of the Ethics Commission and the Attorney General on ethics and related issues.

     • prohibit Gaming Board officials from gaining employment in gaming related fields for two years.

     “We have learned a lot in the four years since we passed the original law. We have casinos that are running smoothly and have been very successful in generating revenue that is reducing taxes for our citizens. But we have also encountered some problems, and it is critical that we correct them now while Pennsylvania’s gaming industry is still young,” Fumo said.

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