Legal Sports Betting

PA Sports Betting: PA Sportsbooks and Online Sports Betting

By Kyle Scott

Published: Nov 1st, 2018 · 11:18 AM EDT

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As you may have noticed, we’ve been writing quite a bit about sports betting around here. Part of the reason is because Philly, specifically, will serve as almost ground zero for the new legal sports betting wave that will eventually change sports consumption as you know it. PA sports betting has arrived with the opening of retail sportsbooks at Hollywood Casino at Penn National Race Course, Parx, The Turf Cluf, SugarHouse and Rivers Casino.

The question now becomes, when does online sports betting in PA begin?

PA online sports betting

Back in the summer, Pennsylvania officials targeted the start of football season and the end of the year for launches of physical and online sportsbooks in PA, respectively. Both of those targets were missed, with physical locations not opening until mid-November, and, as of yet, no online sportsbooks being given the go ahead to launch.

It now looks like PA will miss the important NFL playoffs window (though going live for the Super Bowl is still possible?), with some operators now believing the state will wait until March or April to give the green light to several operators all at once.

What will be the PA sports betting apps?

PlaySugarHouse Sportsbook

SugarHouse is particularly interesting because they already participate in online sports betting in New Jersey through their PlaySugarHouse.com app, which offers an online casino and sportsbook. Their parent company, Rush Street Interactive, uses the Golden Nugget and now Monmouth Park gaming license to offer betting under their SugarHouse brand. Make sense? Probably not. But just stay with me. SugarHouse’s online sportsbook, of whom we’re a happy partner, is actually third in revenue in New Jersey behind DraftKings Sportsbook and FanDuel Sportsbook (they actually offer the same lines as DraftKings by virtue of using Kambi to run its book). As such, they may wind up being first out of the gate to offer PA online sports betting.

Of the online sportsbooks in New Jersey, SugarHouse and Harrah’s are the two that now have PA licenses (Harrah’s is owned by Caesars). Parx and Hollywood Casino have plans to offer online sports betting as well, with Greenwood Gaming and Entertainment, the parent company of Parx, partnering with GAN to run theirs.

All of these will have to undergo further age verification and geo-comply testing before going live, but it seems SugarHouse should be first since they are already doing this successfully.

Parx Sportsbook

Parx Casino is working on their own betting app, planning to leverage their local brand in eastern PA to gain significant market foothold early on. Their app will be underpinned by the popular Kambi technology, which sets the markets and powers the sportsbooks for DraftKings, SugarHouse and 888sport. And while this creates a certain level of sameness across the different options, each is free to layer their own UI, promos and customer experience on top. Parx, I’m told, is working to heavily customize their offering and understands their sportsbook needs to resemble something closer to a tech product than a bolt-on casino as was the case with playMGM in New Jersey, which somehow lost money in December, according to a report released by the DGE.

Interestingly, Parx has unveiled a somewhat novel online betslip called Betslip Builder for its casino location. The thinking is for patrons to be able to select their bets on their phone and then bring them to a window to be scanned to lock in their bets. This seems convenient, for sure, but once online betting is live in Pennsylvania, it seems like customers can just… place the bets on their phones and not get up. But I suppose now we’re getting into a conversation about the growth potential of online betting vs. having to walk into a sportsbook to place a bet.

If nothing else, the Betslip Builder allows PA residents to see a glimpse of current lines at Parx.

FanDuel Sportsbook

FanDuel has a partnership in place with Valley Forge Casino and Resort. The latter had its sports betting certificate conditionally approved in late December and it looks like a March launch for their retail sportsbook is likely. But given that PA appears to want physical locations to go live before their online counterparts, a FanDuel app in PA may still be several months off.

DraftKings Sportsbook

DraftKings undoubtedly has plans to enter the PA sports betting market, but as of yet they don’t have a casino partner. Unlike in New Jersey, where each licensed operator can work with up to three partners for their online app, in Pennsylvania each operator can only be partnered with one. DraftKings still has options, but they haven’t yet found one, and thus their launch looks more like its destined for late 2019.

These are the major players. There are a few others, but their plans appear to be less clear at the moment.

 

Current PA sportsbooks

Hollywood Casino at Penn National Race Course

777 Hollywood Blvd.

Grantville, PA 17028

In November, Penn National Gaming launched the first legal sportsbook in Pennsylvania. The physical location is managed by William Hill, which is the largest sportsbook operator in the US, running several joints in Vegas and New Jersey.

SugarHouse Casino

1001 N Delaware Ave.

Philadelphia, PA 19125

On December 16, SugarHouse Casino, which operates under the same brand for owner Rush Street as SugarHouse Sportsbook, which is expected to launch for PA online sports betting early in 2019, opened its temporary facility. They’ve outlined their plans in a proposal to the state for a permanent space that is expected to open in the spring. Here’s the mockup:

Rivers Casino

777 Casino Dr.
Pittsburgh, PA 15212

Rivers Casino opened their space for testing on the same day as SugarHouse as they both have the parent company Rush Street Interactive.

 

Parx

2999 Street Rd.

Bensalem, PA 19020

Parx recently opened its temporary facility, which I actually toured before opening, and while  it’s not large, it’s fairly impressive, but will pale it comparison to the 10,000 square foot behemoth they plan to open in the spring. I can tell you there is a lot of construction going on at Parx, and they seem poised to capitalize on PA sports betting– their location and brand recognition in the Philly area will help that get out of the gate early.

 

Parx at The Turf Club

700 Packer Ave.

Philadelphia, PA 19148

An extension of the Parx sportsbook branding, a second location has been opened at the Turf Club, located inside the Holiday Inn across from Citizens Bank Park.

 

Harrah’s

777 Harrah’s Blvd.

Chester, PA 19013

 

Harrah’s will begin taking sports bets on January 22 at 2:00 p.m. with a grand opening scheduled for January 24, where Brian Westbrook will cut the ceremonial ribbon.

From a press release sent out by Harrah’s:

January 22 starts a two-day operational test period and approval from the Pennsylvania Gaming Control Board (PGCB). The PGCB will hold testing on January 22 and 23 from 2:00 pm to midnight.

Harrah’s Philadelphia’s sportsbook will offer betting on a variety of sporting events like football, basketball, baseball, hockey, soccer, and college athletics. Betting options include straight bets, parlay bets, total bets, in-game betting, and more. Also, Total Rewards members will be able to earn valuable points for every wager made in The Book. The sportsbook will be open Monday – Friday 11am -12am and Saturday – Sunday 10am – 12am. Guests must be 21 years of age or older to enter the casino floor as well as to place bets.

Located in the back of the casino floor previously reserved for “The Block,” The Book at Harrah’s Philadelphia is equipped with 19 better-than-stadium lounge seats, 11 high-top tables, various bar seating and over 45 large screen TVs to watch the action live. Food and beverages tailored specifically for game day will also be available.

 

PA sports betting updates

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The physical sportsbooks are great and all, but the growth area for PA sports betting is, by far, online betting.

 

What about DraftKings, FanDuel and others?

DraftKings will need to partner with a PA operator before they launch in the state. That hasn’t happened yet. FanDuel has partnered with Valley Forge Casino Resort, but they haven’t applied for a sports betting license, though they have been approved for an Internet Gaming license. Stay with me. The point is, the two legal sports betting leaders appear to be behind local companies like SugarHouse and Parx when it comes to PA online sports betting.

 

Will you keep me updated?

You bet! I have continually been asked about where and how you’ll be able to bet on sports in PA from readers who have seen our coverage. We intend to partner with as many sportsbooks as possible to offer you exclusive signup bonuses, unique odds and other promos for sports betting in PA. We’ll keep writing about it here on the site, but the best way to stay updated is to sign up for our email list (we won’t spam you).

We have big plans for a more betting-related content (think, studio) and job postings for those positions so you’ll want to follow us.

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PA sports betting background

The push for mobile sports betting

There were two themes at the East Coast Gaming Congress, and the biggest one was the importance of online betting. Something like 70% of the market in Europe is mobile or real-time betting, also called live betting. Many of these are prop bets. This is the growth area, no doubt about it.

Consider this stat: There is $150 billion wagered on sports in the US each year. Only $3 billion of that is in Nevada. The other $147 billion is either through illegal bookies or non-regulated offshore sites.

The gaming industry wants a piece of that market.

They will compel states to adopt favorable regulations in order to offer competitive mobile betting products. This centers around real-time or “in-play” betting.

This takes many forms.

The most obvious example is a second half betting line that may be available during a basketball or football game. But the ubiquity of mobile devices creates many more possibilities. You can bet on the next series, drive or play. It’s the second screen experience for sports– everything from “who hits the next three-pointer” to new moneyline odds being offered throughout the game. This type of betting is arguably more fun (and addictive) and is the growth area for the industry.

 

How to compete with offshore sites

The industry is well aware that anyone can go online and place a bet today.

How do they beat the offshore sites?

The main message was that aggressive tax rates would pass along costs to the customer, presumably in the form of poorer odds. They showed studies indicating that a 10%-15% tax rate is the range which guarantees the greatest output for the state before significant customer losses. Again, Pennsylvania is currently at 36, which means PA sports betting sites will have to deal with significant more costs, limiting the amount operators may want to focus their efforts. We have spoken to several books that have no plans to even enter the PA market. This is doubly a problem when you consider that PA casinos will have to brand their apps with their own names, thus not allowing for DraftKings or FanDuel to have their own apps in the state (they’ll have to settle for “powered by” or something similar). This gives SugarHouse, and maybe BetStars, an opportunity to gain market share since they won’t be competing as hard with the big brands.

Further, the offshore market excels in online betting. Some states, like Mississippi, will legalize sports betting but not allow it online. That is a mistake. It misses the entire point of this movement (for states), which is to maximize tax revenue. Not allowing online sports betting leaves a lot of money on the table… or perhaps just sends it to Costa Rica, where many of the offshore sites are located.

 

League partnership

One way the regulated space could have an edge over offshore sites is in partnering with the leagues, both in terms of branding (expect sponsorships) and data.

Think about real-time betting, perhaps a wager on pitch speed (will someone throw 100 mph this game?). Who verifies the data? Unlike scores and basic stats, which can be easily checked against an official box score, data required for prop bets may need a trusted partner. This can both provide a competitive advantage over the black market and create revenue opportunities for the leagues, which can license the data to sportsbooks.

To be clear, the gaming industry wants to partner with the leagues– they just don’t want states to mandate a 1% integrity free, something which thus far has been met with resistance from the states anyway. The league will profit regardless through increased interest and viewership, but it seems the way to get money directly from the operators is through direct business relationships.

The Sixers – along with the Devils – just announced a partnership with Caesars, while the major professional basketball and hockey leagues have announced licensing, content and data deals with MGM.

 

Frictionless experience

Thankfully, the legalization of online gaming for poker and such in New Jersey and Delaware has paved the way for sports in Pennsylvania. Credit card processing was an early hurdle in those verticals because banks were worried about fraud. Once the gaming industry proved that it could effectively police itself, Visa, MasterCard and others became more amenable to handling the transactions.

The gaming industry knows it needs to make depositing (and withdrawing!) money a painless experience if PA sports betting is to gain traction. This creates a literal instant advantage over the corner bookie, and having a regulated operator take your action is a safer experience than playing with offshore sites.

 

Geo-fencing

Anna Sainsbury, the CEO of GeoComply USA, a company that provides geo-fencing services for iGaming products, talked about ways to effectively ensure players are in-state. That part is relatively simple. But consider the PA commuter who works in New Jersey or Delaware. What if they can’t place a bet from work? With these states being linked, there was some discussion about allowing wagering across states lines. That’s an area that has yet to be fully worked out, though the industry is aware that creating a consumer-friendly solution is important.

 

Federal regulation

Geoff Freeman, the outgoing CEO of the American Gaming Association, said there was essentially no chance of federal regulation for sports betting. It sounds like it will remain a state issue.

 

Which states are next?

This is taken directly from an AGA slide on which states they feel will move to legalize sports betting next:

Live

Delaware

New Jersey

Nevada

West Virginia

Mississippi

 

2018

Pennsylvania

 

TBD

New York

Ohio

Connecticut

Rhode Island

 

2019

Colorado

Illinois

Indiana

Iowa

Kansas

Massachusetts

Missouri

Texas

 

1-2 years

Maine

Maryland

Michigan

Oklahoma

Kansas

 

5 years

Florida

Louisiana

Kentucky

North Dakota

Wyoming

Idaho

Washington

California

Arizona

New Mexico

 

Sponsorships

This goes without saying, but as more states come online, gambling sponsorships will begin to pervade sports. Almost every major soccer team in the Premier League has a gambling partner. Expect much the same in Pennsylvania.

 

This FAQ was put together by Mike Lyon. He is an attorney in Montgomery County, PA specializing in litigation and gaming law. He tracks all developments in sports gambling in the United States, with a particular interest in Pennsylvania, New Jersey, and Delaware. The information provided in this post is not intended to be and should not be construed as legal advice. You should not act or rely upon information contained in this post without specifically seeking professional legal advice.

The legal aspects of PA sports betting

When the Supreme Court struck down the Professional and Amateur Sports Protection Act (PASPA) in Murphy v. NCAA, et al. in May of this year, a day that many sports fans had dreamed of became reality. With PASPA nullified, legalized sports betting had finally become a possibility outside of Nevada.

All the attention being paid to the legalization of sports gambling in New Jersey and Delaware has left many fans in Pennsylvania wondering when it will come to the Keystone State. As of press time, while PA sports betting is, technically, legal, regulated sports betting has not yet begun. While the exact date that betting will begin in Pennsylvania is still very much unknown, potential bettors should rest assured that it should begin very soon.

In October of last year, Governor Wolf signed into law a massive expansion of gambling in Pennsylvania. That legislation allowed sports gambling to be legalized if the existing federal ban in PASPA was first repealed, which thereafter occurred when the Supreme Court nullified PASPA in Murphy.

The gaming law restricted the possibility of hosting sports gambling to Pennsylvania’s 12 casinos, any of whom could apply for a “sports wagering certificate” with Pennsylvania’s Gaming Control Board (GCB). Holders of a sports wagering certificate would be permitted to take in-person wagers in a designated sportsbook or area within the casino. Online betting was also legitimized by the statute, and certificate holders would be permitted to take wagers through a mobile app or Internet site.

The law provided a 120-day window for the GCB to accept applications for sports wagering certificates, which it began to do on May 31, 2018. Given how popular legalized betting was thought to become, and the national attention paid to Murphy, it was thought that applications would come quickly. Many surmised that sports wagering would be operational in Pennsylvania long before the start of the NFL season in early September.

But the fees to be paid by potential applicants for sports betting certificates likely caused (and may still be causing) significant hesitation. The gaming expansion statute required any sports wagering certificate applicant to pay a $10 million initial fee to the GCB following approval of the application. It further requires a renewal fee of $250,000 to be paid to the GCB every five years thereafter. Those entry fees dwarf the comparable fees in New Jersey, which required casinos to pay just $1.2 million in licensing fees (which also include the fee required to carry an internet gaming platform, which is not yet operational in Pennsylvania and not a part of the $10 million initial fee).

In addition, the taxes payable on PA sports betting proceeds are substantial. The gaming expansion law provided a whopping 34% tax rate on gross sports gaming revenue to be paid to the state, plus an additional 2% to be remitted to local or municipal taxing authorities. That makes for an effective 36% tax rate on all betting proceeds. This dwarfs the 8.5% rate for in-person bets or 13% rate for online bets over the bridge. The taxes and fees make for a good reason to be cautious about beginning sports betting operations in Pennsylvania.

Legalized betting in Pennsylvania is inching closer. Whenever the first bet is placed, Pennsylvania certainly appears to be ready to reap substantial financial benefits from what should be a very popular endeavor for fans across the Commonwealth.

 

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