Now, with the state government facing a $2 billion-plus deficit and the casino industry's slot revenue in decline due partly to saturation, some state lawmakers are looking for an answer in ... more gambling.
This time, it's legalizing potentially thousands of video poker machines in just about any bar that wants one or more, thus moving the industry from casinos alone into every neighborhood of every city.
But don't worry — this isn't creating new gamblers, according to John Milliron, a lobbyist for the Pennsylvania Amusement and Music Machine Association. He testified at a legislative hearing last week that legalizing video poker would take the money out of the pockets of illegal operators and put it in the pockets of legitimate businesses and the government. It won't create any new gambling because many bars across the state already have the machines, he told lawmakers.
Milliron said video poker would be a $1.2 billion annual business that generates about $500 million a year for the state government, citing similar collections in Illinois. Video poker has been legal there since 2012.
The "ka-ching!" of gambling revenue is sweet music to many lawmakers, who get to extract money from the pockets of the mostly low-income people who gamble without having to call it a direct tax. And there is a bonus with video poker machines. One lawmaker immediately suggested that any authorization law should include a provision that the machines must be supplied by a local vendor — thus adding the ka-ching! of local campaign donations to indirect tax revenue.
Casinos, which have substantial influence in Harrisburg because of the more than $1 billion their operations already produce for the state government, likely won't be very happy about the prospect of neighborhood competition.
That might be enough to deter this latest gambling expansion. Meanwhile, lawmakers' fascination with gambling revenue speaks to their lack of imagination about solving the state's fiscal problems, as they mostly ignore social and local economic dysfunction that are byproducts of their own revenue addiction.
— The (Scranton) Times-Tribune
Fuel for schools
With Pennsylvania's support for schools submerged at a disgraceful 45th in the nation, the commonwealth has no choice but to increase education funding.
Voters said as much in November. Teacher layoffs and local tax hikes that did not make up for losses in educational services motivated many Pennsylvanians to vote for Tom Wolf, who promised to adequately fund schools, over Gov. Tom Corbett.
That public sentiment remains, according to a recent Mercyhurst University poll, which showed that a majority of the state's residents would support more funding for public schools as well as a 5 percent natural-gas tax.
Linking the two, Gov. Wolf unveiled his proposal to tax gas drilling in the stressed Coatesville school district last week. But while his plan has popular support, the Democratic governor is going to have to compromise with the legislature's ruling Republicans to get it passed.
Senate Majority Leader Jake Corman (R., Centre) has said he is open to a severance tax but insists that compromises on the state's troubled pension system must come first. Reducing the unfunded pension liability is an important project that should have bipartisan appeal.
House Majority Leader Dave Reed (R., Indiana) is among those calling for privatizing state liquor stores. Wolf must consider this practical solution to a system that has only frustrated consumers.
Wolf also has to work with fellow Democrats who represent gas-drilling areas. Rep. Pam Snyder (D., Greene) has opposed forgoing the existing "impact fee," a half-measure championed by Corbett to compensate communities for the dangers, traffic, and disruption of drilling. The Wolf administration says those areas would be compensated under his tax plan, but it's not clear whether they would get the same amount of money. While a tax is preferable to the current fee, the state should not shortchange the towns that bear the brunt of the industry.
Wolf's plan, modeled on West Virginia's policy, calls for a 5 percent tax on the value of gas extracted, plus 4.7 cents for every 1,000 cubic feet. Unlike 29 other gas-drilling states, Pennsylvania has yet to impose a tax on this public resource.
Wolf says most of the anticipated $1 billion in yearly revenue would go to education, but some would fund environmental protection and clean-energy development, two worthy and related causes. The governor has also shown sensitivity to the state's other natural resources by banning further gas drilling in state parks.
The elements of a bargain are circulating in Harrisburg. Wolf and legislative leaders would be wise to seize the opportunity to pull Pennsylvania's schools out of the depths.
— The Philadelphia Inquirer
DRONES OVERHEAD: AMERICANS MUST WEIGH IN ON THE NEW TECHNOLOGY
The Federal Aviation Administration has taken the first important step toward allowing the commercial use of drones without endangering the safety of the nation's airspace.
On Sunday it announced proposed rules that have been in the works for years and that could take effect in early 2017. The use of drones other than by hobbyists largely is banned now, but a wide range of businesses are eager to tap the potential of the devices — for example, by farmers to assess crop damage, by utility companies to inspect transmission lines, by news organizations in reporting and by filmmakers.
Although the rules are designed for commercial drones, they also are likely to lead to an increase in drone use by police and fire departments and other government agencies. In that regard, President Barack Obama also on Sunday issued a directive requiring federal agencies to start publicly disclosing where they fly drones in the United States and what they do with the data collected.
The dual announcements are evidence of the complex questions raised by the rapid proliferation of the small, inexpensive devices on privacy and safety grounds. The safeguards announced by the president are necessary to protect individuals from unwarranted aerial surveillance, and the FAA's proposed regulations are needed to safely address the rapidly evolving technology.
The FAA regulations would cover commercial drones weighing less than 55 pounds, and they carry tight restrictions. Operators would not need pilots' licenses, but they'd have to pass a proficiency test and register their aerial devices. Drones could be operated only in daylight and could fly no higher than 500 feet and at speeds of 100 miles per hour or less. The proposal also raises the possibility of more flexible rules for drones under 4.4 pounds.
In most cases, drones could not fly over bystanders, so it's not certain how their use would affect coverage of public events. The rules also put on the back burner any plans for package or pizza delivery by drone.
The FAA proposal and Mr. Obama's memo are smart steps forward on drone use. Now the public has a 60-day period in which to comment before the rules become final. This high-flying technology deserves a close critique from those who will live with it on the ground.
— Pittsburgh Post-Gazette.