Making the News

Charleston Daily Mail

Originally Published:Wednesday, January 3, 2007


Pittsburgh casino already casting gloomy shadow

By Jake Stump
Charleston Daily Mail

The announcement of a new Pittsburgh casino that could offer up to 5,000 slot machines has some West Virginia gaming advocates fretting.

This week, Pennsylvania awarded PITG Gaming a license to build its Majestic Star Casino on the North Shore of the Allegheny River in downtown Pittsburgh.

It will be within an hour's drive of both Mountaineer Racetrack and Gaming Resort in Chester and Wheeling Island Racetrack and Gaming Center, both in the Northern Panhandle.

Business at those two tracks will likely suffer.

Mountaineer Race Track gets one-third of its customers from Pennsylvania, and Wheeling Island relies on Pennsylvania customers for half its business.

PITG Gaming, owned by Detroit businessman Don Barden, plans to open the Pittsburgh casino, complete with restaurants and nightclubs, in March 2008. Former Pittsburgh Steeler Jerome Bettis is a partner.

Forest City Enterprises, which manages the Charleston Town Center and owns 50 percent of the mall, lost out on the licensing bid to open Pittsburgh's only stand-alone casino. Forest City also owns 95 percent of the Charleston Marriott.

West Virginia racetracks likely will feel the brunt of Pennsylvania's gaming industry even before the Majestic Star Casino opens in 14 months.

The Meadows Racetrack and Casino is slated to open in Washington, Pa., just south of Pittsburgh, in April. It is a $450 million gaming center that will have more than 1,800 slot machines, a 3,000-square-foot bar, sit-down snack bar and 300-seat restaurant buffet.

"The biggest concern for West Virginia is The Meadows," said Joseph Weinert, vice president of consulting group Spectrum Gaming and managing editor of the Gaming Industry Observer.

"The most obvious effect is it will provide momentum for legalizing table games," Weinart said. "There will certainly be a negative impact to the slot machines' revenue in West Virginia."

The Meadows also would be within a fairly short drive of West Virginia's two northern racetracks. Wheeling Island would be a 30-minute drive away.

West Virginia's other two racetracks include the Tri-State Racetrack in Cross Lanes and the Charles Town Races and Slots.

Pennsylvania has authorized up to 61,000 video slot machines, and West Virginia officials estimate state racetrack video lottery revenues here will decrease $30 million this budget year and $62 million next year when gamblers head across state lines.

West Virginia's four racetracks brought in $423 million of lottery revenue for the state in 2005-06.

Pennsylvania approved video gambling last year and already has two racetrack casinos operating.

Mohegan Sun at Pocono Downs, near Wilkes-Barre, and Philadelphia Park Racetrack have opened within the past month. Those centers are in eastern Pennsylvania and might not have as much impact on West Virginia.

Three other racetrack casinos, in addition to The Meadows, are expected to open by spring 2007. They are Harrah's Chester, near Philadelphia; Presque Isle Downs in Erie; and Penn National near Harrisburg.

Officials said Penn National has the potential to hurt business at Charles Town Race and Slots in the Eastern Panhandle, about 100 miles from the proposed Harrisburg racino.

Five stand-alone casinos in Pennsylvania, including the PITG Gaming establishment in Pittsburg, will offer only slot machines as forms of gambling at their venues. Four of those will be in Eastern Pennsylvania.

Weinert, the gaming expert, believes at least half of the 61,000 licensed slots in Pennsylvania will be in operation in the next five years. Right now, there are just 2,300 slots in operation in the Keystone State.

West Virginia has 11,300 slot machines in operation at its racetracks.

"I don't think you'll see all 61,000 slots in Pennsylvania up for well over a decade," Weinert said. "But market conditions will dictate that."

Delegate Joe DeLong, D-Hancock, who is set to become House majority leader next month, said the announcement of the Pittsburgh casino adds more fuel to the debate about whether West Virginia's casinos should add table games to their entertainment lineup to entice customers.

"There was plenty of fuel on the fire in the first place," said DeLong, whose district includes Mountaineer Racetrack. "As Pittsburgh comes on line, we'll see a decrease in revenues. What it does is put the Legislature in a position this session. The state is going to lose revenue if we don't do something to keep up."

The Legislature is likely to discuss table games when it meets in January. House Speaker-elect Rick Thompson, D-Wayne, has expressed support for a local referendum that would let voters in four counties with racetracks -- Kanawha, Hancock, Ohio and Jefferson -- decide the fate of table games.

Thompson has stated he would let legislators debate the issue and would not force discussion one way or another.

While Delegate Bob Kiss, D-Raleigh, was House speaker, table games legislation stalled. The Senate passed a referendum measure in 2005, but Kiss was reluctant to bring up the issue on the House floor.

Some legislators, especially those representing the Northern Panhandle, expressed frustration over how House leaders handled the issue last year.

"As a legislator who supports the issues of that area (Hancock County), we've become very sensitive to the job and revenue loss that could take place," DeLong said.

A statewide survey released by the West Virginia Racing Association earlier this year showed 61 percent of registered voters favored allowing residents in the four racetrack counties to decide the table games issue.

Contact writer Jake Stump at jakestump@dailymail.com or 348-4842.

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