PRINTER'S NO. 1890
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
1393
Session of
2015
INTRODUCED BY WARNER, MILLARD, DIAMOND, SANKEY AND NESBIT,
JUNE 24, 2015
REFERRED TO COMMITTEE ON GAMING OVERSIGHT, JUNE 24, 2015
AN ACT
Amending Title 4 (Amusements) of the Pennsylvania Consolidated
Statutes, in gaming, further providing for Category 1 slot
machine license, for change in ownership or control of slot
machine licensee, for multiple slot machine license
prohibition; and prohibiting undue economic concentration.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Section 1302(a) of Title 4 of the Pennsylvania
Consolidated Statutes is amended to read:
§ 1302. Category 1 slot machine license.
(a) Eligibility.--A person may be eligible to apply for a
Category 1 license to place and operate slot machines at a
licensed racetrack facility if the person:
(1) has been issued a license from either the State
Horse Racing Commission or the State Harness Racing
Commission to conduct thoroughbred or harness race meetings
respectively with pari-mutuel wagering and has conducted live
horse races for not less than two years immediately preceding
the effective date of this part;
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(2) has been approved or issued a license from either
the State Horse Racing Commission or the State Harness Racing
Commission to conduct thoroughbred or harness race meetings
respectively with pari-mutuel wagering within 18 months
immediately preceding the effective date of this part and
will successfully conduct live racing pursuant to the
requirements of section 1303 (relating to additional Category
1 slot machine license requirements);
(3) has been approved by the State Harness Racing
Commission, after the effective date of this part, to conduct
harness race meetings with pari-mutuel wagering and will
conduct live racing pursuant to the requirements of section
1303; or
(4) is a successor in interest to persons eligible under
paragraph (1), (2) or (3) who comply with the requirements of
section 1328 (relating to change in ownership or control of
slot machine licensee) or is a successor in interest to
persons otherwise eligible under paragraph (1), (2) or (3)
but precluded from eligibility under the provisions of
section [1330] 1330.1 (relating to undue economic
concentration prohibited).
Nothing in this part shall be construed to permit the approval
or issuance of more than one slot machine license at a licensed
racetrack facility.
* * *
Section 2. Section 1328 of Title 4 is amended by adding a
subsection to read:
§ 1328. Change in ownership or control of slot machine
licensee.
* * *
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(f) Undue economic concentration prohibited.--A change in
ownership or control of a slot machine licensee shall comply
with section 1330.1 (relating to undue economic concentration
prohibited).
Section 3. Section 1330 of Title 4 is repealed:
[§ 1330. Multiple slot machine license prohibition.
No slot machine licensee, its affiliate, intermediary,
subsidiary or holding company may possess an ownership or
financial interest that is greater than 33.3% of another slot
machine licensee or person eligible to apply for a Category 1
license, its affiliate, intermediary, subsidiary or holding
company. The board shall approve the terms and conditions of any
divestiture under this section. Under no circumstances shall any
such divestiture be approved by the board if the compensation
for the divested interest in a person eligible to apply for a
Category 1 license exceeds the greater of the original cost of
the interest, the book value of the interest or an independently
assessed value of the interest one month prior to the effective
date of this part and, in the case of a person eligible to apply
for a Category 1 license, unless the person acquiring the
divested interest is required to continue conducting live racing
at the location where live racing is currently being conducted
in accordance with section 1303 (relating to additional Category
1 slot machine license requirements) and be approved for a
Category 1 slot machine license. No such slot machine license
applicant shall be issued a slot machine license until the
applicant has completely divested its ownership or financial
interest that is in excess of 33.3% in another slot machine
licensee or person eligible to apply for a Category 1 license,
its affiliate, intermediary, subsidiary or holding company.]
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Section 4. Title 4 is amended by adding a section to read:
§ 1330.1. Undue economic concentration prohibited.
(a) General rule.--No slot machine licensee, its affiliate,
intermediary, subsidiary or holding company may possess an
ownership or financial interest of another slot machine licensee
or person eligible to apply for a Category 1 license, its
affiliate, intermediary, subsidiary or holding company if the
ownership or financial interest would result in undue economic
concentration in this Commonwealth.
(b) Board to establish criteria.--The board shall establish
through regulation criteria for determining whether the issuance
of a slot machine license or a change in ownership or control of
a slot machine licensee occurring under section 1328 (relating
to change of ownership or control of slot machine licensee)
constitutes undue economic concentration. The criteria shall
include:
(1) The percentage share of the market presently
controlled by the applicant.
(2) The estimated increase in the market share if the
applicant is issued the slot machine license.
(3) The relative position of other slot machine
licensees.
(4) The current and projected financial condition of the
gaming industry in this Commonwealth.
(5) Current market conditions, including level of
competition, consumer demand, market concentration, any
consolidation trends in the industry and any other relevant
characteristics of the market.
(6) Whether the applicant has separate organizational
structures or other independent obligations.
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(7) Potential impact on the projected future growth and
development of the gaming industry in this Commonwealth.
(8) Whether the issuance or holding of the slot machine
license by the applicant will adversely impact consumer
interests.
(9) Any other criteria the board may require.
(c) Divestiture.--No applicant shall be issued a slot
machine license or approved for a change in ownership or control
until the applicant has completely divested a portion of
ownership or financial interest of another slot machine licensee
or person eligible to apply for a Category 1 license, its
affiliate, intermediary, subsidiary or holding company
determined by the board to be necessary to meet the requirements
of this section. The board shall approve the terms and
conditions of any divestiture that may be required under this
section.
(d) Definition.--For the purpose of this section, "undue
economic concentration" means that a slot machine licensee, its
affiliate, intermediary, subsidiary or holding company would
have such actual or potential domination of the gaming market in
this Commonwealth as to substantially impede or suppress
competition among slot machine licensees or adversely impact the
economic stability of the gaming industry in this Commonwealth.
Section 5. This act shall take effect in 60 days.
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