A happy-hour special intended to help plug Pennsylvania’s budget with Vegas-style, around-the-clock alcohol service at state casinos has flopped.
Not a single after-hours drink has been served as none of the state’s dozen casinos have taken lawmakers up on their offer.
“The cost associated with it doesn’t make mathematical sense,” said Craig Clark, general manager of Rivers Casino on Pittsburgh’s North Shore.
Lawmakers in June approved a provision for casinos to be able to sell beer, wine and liquor between 2 and 7 a.m. — something state law prohibits at other businesses.
Those additional five hours of service each day, however, would cost casinos $1 million in license fees for the first year and an additional $1 million for each of the next four years, before the annual renewal fee drops to $250,000.
Elected officials in June overhauled the state’s liquor laws to generate $149 million in additional revenue. They figured $12 million for 2016-17 would come from state casinos.
“We did assume the 12 casinos would buy in,” said John O’Brien, an aide for Rep. William Adolph, the Delaware County Republican who chairs the House Appropriations Committee. “Obviously, they haven’t.”
Since the law took effect Aug. 8, no casino has applied, the Pennsylvania Liquor Control Board reported.
Clark said Rivers would secure one if the price was right.
“I’ve heard $250,000 bounced around,” Clark said of an ideal application fee. “Something like that or below, I think, is realistic. We can’t pay for everything.”
The draw for Clark would not be to serve alcohol at all hours but to be able to serve alcohol until 2 a.m. Currently, the casino stops serving at 1:15 a.m. so staff members can clear all alcohol from the floor by the legal cutoff time, he said.
“It’s really about removing a competitive disadvantage,” said Clark, noting that smaller bars and restaurants don’t have the same challenges as clearing drinks from a 138,000-square-foot space.
Special nights, such as New Year’s Eve and major events Downtown or at Heinz Field, could be other reasons for expanded alcohol service, he said.
“But it’s a balancing effort,” Clark said. “We always want to maintain a safe, comfortable environment for everyone.”
The law passed because of interest from numerous casinos, said House Republican spokesman Steve Miskin.
Ten of the state’s casinos — including Rivers and The Meadows in Washington County — in May 2015 wrote lawmakers about issues to help them remain competitive with casinos in neighboring states. That included passing a law to allow expanded alcohol sales but also to introduce new games, keep free slots play from being limited or taxed and not to ban smoking.
Though there have been no takers, the $1 million price tag might not change, said Miskin.
“This is what was able to garner the support of the Legislature,” he said. “I’m not aware of any discussion to make changes.”
Management at The Meadows declined to comment, as a deal to sell the casino and racetrack is being finalized. The matter goes before the Pennsylvania Gaming Control Board this week.
Hollywood Casino in Dauphin County, however, has said it had no intention of applying for an expanded liquor license, no matter the cost.
Regardless of whether casinos pay up for the extra hours, O’Brien said, lawmakers are considering other options that would more than cover the $12 million of unrealized annual revenue. That includes the idea of allowing unused liquor licenses to be transferred across county lines for an additional fee, he said.
“We have some tweaks we are seeking to do with the legislation,” O’Brien said. “Everything matters. But that’s where we’re at.”