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State's slot payout rates drop to another low

| Friday, July 8, 2011

Jim and Joyce Matthews are casino veterans. They've played at Rivers, The Meadows, Wheeling Island, Atlantic City, Mississippi and suburban Chicago in between twice-a-year trips to Las Vegas.

So when the couple from Fairchance, Fayette County, think slot payouts are getting tighter, they might be on to something.

"It just seems like when the local casinos first opened, the payouts were higher," said Jim Matthews, 64, a retired mail carrier who enjoys table games but also plays slots in denominations from a penny to $5. "Now they're lower."

Payout rates for Pennsylvania slot machines have hit their lowest point since casinos opened in 2006, according to figures released this week by the Gaming Control Board. Statewide, slot machines had a 90.23 percent payout rate for the 2010-11 fiscal year, which ended June 30. That means for every $100 bet, the machines returned an average of $90.23.

That's down from 91.05 percent in 2009-10 and from the high point of 91.3 percent in 2007-08. Each Pennsylvania casino posted its lowest payback rate ever.

However, that doesn't necessarily mean casinos are tightening up individual machines.

This year's falloff "makes sense" because of the launch of live table games in July 2010, said slot expert Frank Legato, editor of the trade publication Global Gaming Business. Before then, casinos had several "virtual" blackjack and roulette games that played like the table games but were classified as slot machines.

The virtual blackjack games could have had a payback as high as 98 percent, said Legato, a native of Library and a Duquesne University graduate who has written about slots for more than 25 years. Paybacks at traditional slot machines typically are far less.

The payback rate on the virtual tables, combined with their minimum bets of $5 to $25, skewed overall slot payout rates for the first few years, Legato said. In addition, each playing position counted as a separate slot machine; so what appeared to be a five-seat virtual blackjack table with a $15 minimum showed up in the books as five $15 slot machines.

With the advent of live table games, casinos did away with many virtual blackjack machines.

"(The drop in payback) also relates to what denomination of slot machines they used to replace the automated tables," Legato said. "My guess is that they're probably a lot of penny machines." Those are the most popular among players, even with a skimpy payout of 88 percent to 90 percent.

Legato said penny slots give players a lot of time on the machine with a $20 buy-in.

"If you want to play penny games, you ought to know going in that you're going to give up over 10 percent of house edge to the casino," he said. "I'm not sure all people know that."

Pennsylvania's Gaming Control Board oversees installation and maintenance of slot machines. It also tests all slots to make sure they meet the state minimum payout rate of 85 percent. All machines at each casino are hooked into a state-run computer system that tracks wagers and payouts to make sure the state gets its 55 percent share of the revenue.

Board spokesman Richard McGarvey also said the elimination of the virtual table-game machines contributed to the drop in payout percentage. He said the board has not seen a pattern of casinos reprogramming machines to reduce payouts.

Casinos routinely alter their slot lineup, adding and dropping machines based on popularity. Sometimes that means taking out a machine with a 91 percent payout, for example, and replacing it with a more popular or newer game that has a lower payout rate.

Legato said slot manufactures give casinos a choice of six or seven payback rates for each game, typically ranging from 86 percent to 96 percent.

"The slot managers just pick one," he explained. "They go according to their (casino) policy. That's why you'll see consistency in each market."


John Horvatich of New Brighton won $137,025 by finishing sixth Thursday in the the last $1,500 Hold 'Em tournament of the World Series of Poker in Las Vegas. The tourney started with 3,389 players. Horvatich entered Day 3 with the lowest chip stack of the 42 final players but worked his way to No. 2 at one point. On his last hand, his pocket Kings lost to Hasan Anter of Sweden, who hit trips with pocket 8s.

David Eldridge of Cranberry won $12,261 for finishing 51st in the same tournament and Craig Zotter of Pittsburgh won $2,882 for 285th. It was Zotter's second cash of this year's WSOP.

Four other Western Pennsylvania players cashed at WSOP events this week:

• Joe Patrick of New Castle won $25,919 for finishing 26th in the $5,000 Triple Chance Hold 'Em event. It was his second cash of this year's WSOP.

• In the final $1,000 Hold 'Em tournament, Ryan Stackman of Mars won $6,012 for 76th place; James Gruseck of Allison Park, $3,624 for 150th; and Kenneth Suponcic of Pittsburgh, $2,676 for 276th.

The $10,000-per-seat Main Event opened Thursday; the final table is to be determined July 19.

The WSOP isn't the only game in town. The Venetian Deep Stacks Tournament draws thousands of entrants. Jim Augustine of Scott won $1,082 for finishing 31st in a $340 buy-in tournament on June 28.


Are slot machines set to pay out more after midnight• (from Vera)

No. Slot machines are programmed to pay out a set percentage over a long period of time -- months or years. If you hit a jackpot at 3 a.m., it just happened to be a lucky time for you. You never can tell when a machine will hit. But the casino can be sure that, over time, the machines will pay out close to what programmers said they would.

Additional Information:

How we stack up

Average slot payout rates for all denominations of play*:

Rivers: 90.04 percent

The Meadows: 90.11 percent

Presque Isle in Erie: 90.35 percent

West Virginia: 89.81 percent

Atlantic City: 91.15 percent

Las Vegas Downtown: 93.61 percent

Las Vegas Strip: 92.69 percent

North Las Vegas: 94.1 percent

Tunica, Miss.: 92.27 percent

*Atlantic City figure is for May; Tunica figure is for April; all others are for most recent 12-month period available

Source: State gaming authorities

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