The day after the Pennsylvania Supreme Court upheld the state's gambling law, Penn National Gaming Inc. and other racetrack operators hoping to win slots parlor licenses said they're ready to begin construction.
The court ruling means the Pennsylvania Gaming Control Board can complete crafting the rules and licensing procedures and could begin issuing conditional licenses to racetracks by the end of the year.
Penn National, of Wyomissing, wants to become a major player in Pennsylvania's nascent gambling business and intends to spend $240 million on a new racetrack and slots parlor in Grantville, near Harrisburg.
"We are anxiously awaiting our licensing approval from the Gaming Control Board, at which time we will begin construction of that facility," company spokesman Eric Schippers said.
Yesterday, Penn National shares rose while the shares of most casino operators fell. Shares of Penn National closed at $34.46, up 26 cents. On Wednesday, shares of the company had jumped $4.11, or 14 percent, on news of the Supreme Court decision.
Bobby Soper, president and CEO of Pocono Downs Racetrack, said the ruling lifted a heavy cloud of uncertainty for his company, Mohegan Tribal Gaming Authority. Mohegan bought Pocono Downs from Penn National for $280 million earlier this year and plans to spend $175 million expanding it.
"The ruling will help us proceed with the construction process because it provides some security that the legislation that passed is valid and legitimate," he said. "It removes the largest legal obstacle in this process."
Las Vegas-based Ameristar Casinos Inc. has plans to build a $500 million slots and entertainment venue on 27 acres in Philadelphia's Fishtown section.
"We're very pleased that the Supreme Court upheld the constitutionality of Act 71," Kevin Feeley, local spokesman for Ameristar, said referring to the gambling law. "It allows us to get going in pursuit of the goal, which is to secure a gaming license and operate a world-class facility in Philadelphia."
Ameristar shares closed at $26.58 yesterday, down 85 cents.
"This is clearly a huge positive, allowing the Pennsylvania Gaming Control Board to move forward with the implementation of the slots law," wrote Marc Falcone of Deutsche Bank Securities Inc., in his analysis after the court decision was released.
Pennsylvania's gambling law calls for up to 61,000 slot machines at 14 locations around the state. In addition to awarding seven licenses to racetracks, the gambling board will award five licenses to stand-alone sites, and two limited licenses to resorts.
Of the stand-alone sites, two are slated for Philadelphia, and one for Pittsburgh. Sites around the rest of the state will compete for the other two licenses.
"We're pleased that the state upheld the law," said Jan Jones, spokeswoman for Harrah's Entertainment Inc., which last week completed its acquisition of Las Vegas-rival Caesars Entertainment Inc. and became the world's largest gambling company.
Harrah's has broken ground on a $392 million harness track in Chester, Delaware County, which it co-owns. It also owns land in South Philadelphia where it hopes to build a $350 million slots parlor, and another parcel in Pittsburgh for another slots parlor.
Donald J. Trump has expressed interest in securing one of the two gambling licenses for a slots parlor in Philadelphia, and Trump executives have been exploring sites in the city. His casino company, Trump Entertainment Resorts Inc., owns three casino hotels in Atlantic City and a riverboat casino in Gary, Ind.