Published: March 18, 2022

Pennsylvania to Distribute $2M in Grants for Illegal Gambling Crackdown

Illegal gambling schemes were put on high alert this week with the Pennsylvania Gaming Control Board (PGCB) announcing the opening of its $2 million annual grant program. The funding is designed to infiltrate underground casinos and other rogue gaming operations.

The agency has opened the application period for its Local Law Enforcement Grant Program, which provides local police departments and other law enforcement agencies with grants up to $250,000.

The funds are generated each year by way of gaming taxes. The grants to local law enforcement agencies are to fund activities related to the “identification, prevention, deterrence, enforcement, investigation, or prosecution of activities involving unlawful gambling in the Commonwealth.”

Qualifying recipients include municipal and regional police departments, district attorney offices, the Pennsylvania State Police, and sheriffs with the authority to conduct enforcement of unlawful gambling. Specific task forces formed by any of the aforementioned agencies also qualify.

New for 2022 is that college and university police departments can additionally seek PGCB grants.

Regulation Massive Undertaking

Pennsylvania today has the nation’s third-largest gaming industry, behind only Nevada and New Jersey. The PGCB has the herculean task of overseeing all aspects of gambling involving 16 land-based casinos, iGaming, retail and online sports betting, daily fantasy sports, and video gaming terminals (VGTs) at truck stops.

The Pennsylvania gaming industry employs thousands of Pennsylvanians and is expected to generate more than $2 billion in tax revenue during the state’s 2021/22 fiscal year. The tax money is used to support an array of programs and initiatives.

Of every $1 kept by a slot machine, 34 cents goes towards property tax relief for Pennsylvanians. Eleven cents is allocated for the horse racing industry, five cents for the state’s Economic Development and Tourism Fund, and four cents stays with the casino’s host county and municipality.

For every dollar won by casinos on table games, 14 cents are set aside for the Pennsylvania General Fund and two cents for the local host government.

Unregulated Gaming Widespread

The Pennsylvania Gaming Control Board’s law enforcement grants are to help cover expenses incurred by such police units investigating underground gambling dens. The grants aren’t expected to be used to raid the tens of thousands of unregulated gambling machines that have proliferated restaurants, bars, and convenience stores in recent years. Critics of those claim they are operating under the guise of “skill gaming.”

The legality of popular games such as “Pennsylvania Skill” remains in question, as state courts have yet to reach a consensus opinion.

Tavern owners claim the machines have helped offset some of their business losses caused by COVID-19. State police claim the devices constitute illegal gambling.

The debate has been ongoing for more than two years. Superior Court Judge Patricia McCullough added much uncertainty to the discussion when she ruled in 2020 that skill gaming machines are “not subject to the Gaming Act.” She claimed that’s because Pennsylvania’s commercial gambling law doesn’t regulate unlawful gambling. Police have encouraged lawmakers to specifically outlaw the controversial apparatuses.

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