Pennsylvania gaming
off to dubious start

Sep 26, 2006 4:40 AM

The fledgling gaming bureaucracy in the commonwealth of Pennsylvania is off to a dubious start.

On Wednesday, the newly-formed Gaming Control Board is scheduled to award conditional slot licenses to horse racing tracks, including The Meadows harness track, which is owned by Las Vegas-based Millennium Gaming.

But the board’s chairman has refused to release the details of a state-commissioned study that projects how much money slot machines would generate.

Chairman Tad Decker said the study’s information is "proprietary," and in a heated exchange with reporters, he vowed to keep the details secret.

"You can make all the damn arguments you want," Decker said. "You’re not getting it. It’s proprietary. File your lawsuit. File your (right-to-know law) requests."

Decker said "raw numbers" from the study will be released at this week’s meeting, but no details or explanations will be offered.

Some of those numbers have Bill Paulos, a partner in Millennium Gaming, concerned. A portion of the study, conducted by PriceWaterhouse Coopers, predicts a casino at The Meadows would generate only $118.8 million a year in slot revenue — about half of the $236.6 million a year predicted by Millennium Gaming.

"I certainly think it’s wrong," Paulos said of the study’s predictions, adding that if the state’s numbers are correct, the casino would fail.

Paulos said he has received just one page from the report and has not seen any of the details or methodology. The Gaming Control Board paid for the report, but will bill Millennium and other license applicants for the cost.

Decker said that a dispute over how much slot revenue will be generated at The Meadows shouldn’t be cause for concern about the state receiving the money it expects from gambling. "That would be a gross exaggeration," he said.

Governor Ed Rendell has said slots should raise $3 billion a year, of which $1 billion would be earmarked to reduce property taxes.

The governor and lawmakers have said the Gaming Control Board should release the study, if only to calm fears that the numbers don’t support the notion that the industry will be as lucrative as officials hope.

As many as 61,000 slot machines at 14 locations have been approved by lawmakers. The slot machine casinos are scheduled to begin opening next year.

A spokesman for PriceWaterhouse Coopers said the company does not typically place privacy restrictions on studies it completes for public agencies. He declined to comment directly about the study for Pennsylvania regulators.

"If you are a private entity and don’t want that information to go public, don’t deal with a public entity," said Russ Diamond, who created the public advocacy organization PACleanSweep. "We’re talking about the state government here."