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Pennsylvania gaming board's size too big for mature industry, report concludes

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Friday, May 9, 2014, 12:01 a.m.
 

The oversight body for Pennsylvania's gambling industry has more employees per casino than any other state, including Nevada.

A legislative report found the Pennsylvania Gaming Control Board has 15 times more workers per casino than Nevada — which boasts the most casinos in the country. The Keystone State has about as many employees as New Jersey, home to Atlantic City's boardwalk destination casinos.

“Other states that regulate and manage their casino markets more than Nevada or New Jersey also expend much less manpower for daily regulation of casinos,” found the report, prepared by Econsult Solutions and released on Wednesday by the Legislative Budget and Finance Committee.

The gaming board's size may have been appropriate when the industry was new and growing, “but now as the industry matures, the required size is smaller,” the report by the Philadelphia-based economics consulting firm concluded.

Pennsylvania has 12 operating casinos, including Lady Luck Casino Nemacolin in Fayette County, which opened its doors in July. A 13th casino license is earmarked in Philadelphia, and a 14th is proposed in Lawrence County.

The Pennsylvania Gaming Control Board has 309 employees and 13 main bureaus, offices and divisions. Funded by casino assessments and fees, the board spent about $34 million last year on personnel and operations.

The Nevada Gaming Commission and Gaming Control Board employ a combined 417 workers on a budget that last fiscal year totaled about $43 million. The agency is responsible for about 350 licensed and active casinos, plus 2,011 restricted gambling locations.

Mark Lipparelli, gaming industry consultant and former chairman of the Nevada Gaming Control Board, said agency staffing is designed to correlate with responsibilities.

“So much depends on the underlying statutory framework and the expectations set by the Legislature,” he said. If the law requires full-time, on-site inspectors or frequent audits, a state may need more staff, Lipparelli said. In New Jersey, for instance, state inspectors used to be required at every behind-the-scenes money count, although the state recently rescinded that requirement.

New Jersey, which has 11 casinos, has a staff of 50 at the Casino Control Commission who are responsible for licensing. A larger Division of Gaming Enforcement handles day-to-day operations, with 246 employees last year and an expected 281 employees by 2015.

Michigan has three commercial casinos and 22 tribal casinos. The Gaming Control Board there employed about 130 people in 2012, in addition to dedicated staff at the state police and attorney general departments.

Spokesman Doug Harbach said the Pennsylvania Gaming Control Board is working on streamlining oversight operations. Staff is down from 330 in November 2010, and two new casinos have opened since then.

“We were still able to reduce our complement during a time in which there was the opening of two more casinos in which we needed to add approximately 20 onsite staff in our Casino Compliance unit,” Harbach said in an email to the Tribune-Review.

Agencies evolve with the law, Lipparelli said. If Pennsylvania considers legalizing online gaming, a growing trend nationwide, existing staff may oversee it, or new positions could be created.

“It tends to scale up in that phase of legalization, and then it's naturally followed by some series of reform that makes sense for the agency and for the industry,” Lipperalli said.

The Pennsylvania Gaming Control Board has been around for a decade. Then-Gov. Ed Rendell signed off on a bill legalizing slot machine gaming in 2004, establishing the board as an oversight and licensing agency.

Diane Berlin, coordinator for CasinoFree PA, which opposes legalized gambling, criticized the board for having “lucrative” staff, salary and resources while it “promotes casino gambling.”

“I've been to a number of meetings and hearings,” she said. “ ‘Disappointed' is too mild of a word; It's ‘disillusioned.' ”

The analysis on board size appears in the legislative report under a heading of “Regulations Disadvantaging Pennsylvania Gaming.” Among other observations, the report points to lengthy approval time for new games and machine models.

Casino operators, the report noted, complain that approvals take longer in Pennsylvania than other states, “and this delay causes frustration for gamers searching for the latest devices.”

Melissa Daniels is a staff writer for Trib Total Media. She can be reached at 412-380-8511 or mdaniels@tribweb.com.

 

 

 
 


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