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Casino money to stop

Towns to lose millions of dollars

HARRISBURG — Pennsylvania’s highest court on Wednesday struck down a requirement that has forced casinos to pay tens of millions of dollars to their host communities for a decade, potentially dealing a crippling blow to local budgets around the state if lawmakers do not act quickly.

The Pennsylvania Supreme Court ruled that the roughly 4 percent “local share assessment” is unconstitutional because it is not uniform and affects Pennsylvania’s 12 casinos differently.

The justices said they would delay the effect of their decision striking down the tax for four months to give lawmakers an opportunity to fix it.

“We are mindful that our decision may significantly affect many counties and municipalities that have ordered their affairs in reliance upon” the casino tax revenue, Justice David Wecht wrote in the 18-page opinion.

Under the state’s original 2004 casino law, casinos must pay at least 4 percent of gross slot-machine gambling revenues to their host communities. That includes 2 percent to counties and 2 percent or $10 million, whichever is greater, to municipalities.

SugarHouse Casino in Philadelphia is exempt, as are two smaller “resort” casinos: Valley Forge Casino in suburban Philadelphia and Lady Luck Casino Nemacolin in southwestern Pennsylvania.

But Mount Airy Casino in northeastern Pennsylvania’s Pocono Mountains had asked the court to strike down the $10 million host fee, arguing that it violates the state constitution by imposing a heavier tax burden on lower performing casinos.

Some $141 million in slots revenue was paid in the last fiscal year to counties and municipalities, according to Pennsylvania Gaming Control Board data.

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