The new gambling law in Pennsylvania, a mere 3-months old, has already run into trouble. It has been amended in legislation forced through by State Senate Republicans, many of whom were against the gambling law.

Pennsylvania has legalized 14 slot machine licences for parlours as well as racetracks, putting thousands of gaming terminals into the state. The president of the American Gaming Association, Frank Fahrenkopf Jr, sees this as a missed opportunity. Speaking at the Las Vegas G2E show he said that resort-style casinos would have brought more economic development to the region.

Several eminent gaming industry professionals discussed the problems of state legislation at the show, during a roundtable with the Emmy award winning CNN presenter Larry King moderating. Apart from contending with differing regulations in 50 states with legalized gambling, bigger problems are the shifting legislation that prevents any long-term planning by the gaming corporations and over-taxation that kills the industry.

An unprecedented $50 million licence fee has been established in Pennsylvania and a tax rate to operators of 52%. Doubtless this will not prevent companies applying for licences but they will hope that taxes won't be increased again to cause problems such as those encountered in the states of Michigan and Illinois. Both these states have recently increased taxes to gaming operators with subsequent job losses in the industry.

The amendments to the Pennsylvania law have placed more oversight authority in the hands of the state Attorney General who must now approve leases, contracts and regulations passed by the Pennsylvanian Gaming Control Board. An investigative division is to be set up within the Attorney General's office to look into criminal activity related to gambling. A further amendment, agreed by Democrats and Republicans alike, prohibits lawmakers and public officials from having any interest in companies operating or supplying gambling halls, unless in a fund not controlled by them, i.e. blind trusts or mutual funds.

Slot machines in Pennsylvania will certainly have an effect on the commercial gaming industry but nearby Atlantic City is not expected to suffer. Here the 'destination resort-style casinos' will keep their advantage over slot machine parlours.

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