Why Plans For Fifth Pennsylvania Mini-Casino Remain Stuck

Written By Darren Cooper on April 21, 2022
Pennsylvania Plans For Fifth Mini Casino Remains Stuck

It’s a mini-casino with a major issue.

Plans for a Pennsylvania mini-casino near State College have gotten bogged down in a lawsuit between competing bidders for the location and questions on whether or not the winning bid met the criteria set forth by the Pennsylvania Gaming Control Board.

At odds are the Cordish Companies, which are Baltimore-based but operate in Pennsylvania as Stadium Gaming LLC and run both the Live! Philadelphia hotel-casino and the Live! Pittsburgh casino.

They are alleging that the Ira Lubert-backed bid for the fifth mini-casino spot in Pennsylvania was improper because Lubert partnered with people who should not have been eligible to bid and that his relationship with Bally’s wasn’t spelled out in the bid.

Why does this matter for Pennsylvania?

Mini-casinos were created in 2017 by the gambling expansion act that also cleared the way for Pennsylvania sports betting. The purpose of mini-casinos is to give options for players to go to places that weren’t in major metropolitan areas.

By rule, mini-casinos, or “satellite” casinos, have a smaller physical footprint and can feature between 300 and 750 slot machines. Some can have up to 40 table games.

Original plans called for 10 spaced throughout the state. However, the state was only able to find takers for five of the licenses. Three are active. The Parx Casino in Shippensburg has been delayed because of building issues but is set to open by the end of the year.

That brings us to No. 5.

Pennsylvania casino bid process goes down

The Penn Gaming Control Board developed an auction process for those wishing to grab an operator’s license for a mini-casino. This is where it gets dicey.

At first, the auctions were only open to existing casino operators, but when that reservoir dried up, new legislation opened the bidding to anyone with an ownership interest in an existing license.

Enter Lubert.

Lubert owned a stake in Rush Street Gaming’s River Casino in Pittsburgh and was part of the development group for Valley Forge Casino Resort.

The Penn State graduate and member of the school’s Board of Trustees has impeccable credentials as a businessman with a net worth listed as $45 million. Lubert put together a $10 million bid for a mini-casino near State College (near Penn State’s main campus).

His bid was accepted on Sept. 2, 2020. The site chosen was a closed Macy’s at Nittany Mall in College Twp, about a mile off of the I-99 corridor. But since then, nothing has happened.

Concern over State College Pennsylvania

The Cordish Companies sued Lubert and his new company SC Gaming LLC and the gaming board alleging that when Lubert partnered with other people in his bid, that rendered the bid ineligibly.

Also, Lubert created State College Gaming to apply and pay for the license, which is against the rules. Therefore the license should go to the next highest bidder, which, while unconfirmed, is most likely the Cordish Company.

A hearing was scheduled for March 7, but there’s no clear date when a ruling will come.

The Penn Gaming Control Board has denied that there is any correlation to the lawsuit and the fact that the license to the Lubert group has yet to be granted, only saying that it is continuing to do background checks.

Photo by Shutterstock.com
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