Pa. high court OKs King of Prussia casino

Posted: March 08, 2011

A local group that wants to put up to 600 slot machines and 50 table games at the Valley Forge Convention Center can go ahead with its plan after the Pennsylvania Supreme Court ruled Tuesday that the venue fit the definition of an established resort hotel under the state's gaming law.

In a 3-2 decision, the state court ruled in favor of the Pennsylvania Gaming Control Board's May 2009 decision to award one of two casino resort licenses to Valley Forge Convention Center Partners L.P., and rejected Greenwood Gaming and Entertainment Inc.'s appeal of the board's decision.

Greenwood Gaming owns the state's top grossing casino, Parx in Bensalem. A rival gambling hall at the Valley Forge Convention Center poses new competition less than 25 miles away, in King of Prussia.

"We are pleased that the Supreme Court upheld this licensing decision which allows this project to move forward so it can create jobs, enhance tourism and produce much needed tax revenue for the Commonwealth," Greg Fajt, chairman of the Gaming Control Board, said in a statement.

In addition, Fajt said, the court's ruling recognized that the board "conducted a thorough review of the Valley Forge application and that its award of the resort license was appropriate and based upon substantial evidence."

Bob Green, chairman of Greenwood Gaming, could not be reached for comment Tuesday night.

Among the issues that Greenwood Gaming raised when it appealed on June 5, 2009, was whether the Gaming Control Board properly determined that Valley Forge was the owner of the Valley Forge Convention Center or had sufficient ownership status to satisfy the eligibility criteria under the state Gaming Act. It also questioned whether the gambling board properly determined if Valley Forge owned and operated a "well-established resort hotel" as described in the Gaming Act and in board regulations. Such a facility was to have at least 275 hotel rooms and year-round recreational guest amenities, such as tennis courts, a spa, and restaurants.

In its 13-page ruling, authored by Justice Seamus McCaffery, the court determined that the Valley Forge Convention Center, which has 488 guest rooms, an outdoor swimming pool, a 3,000-square foot fitness center, and a ballroom, among other attractions, met the criteria.

Two justices, Thomas Saylor and Michael Eakin, dissented and two others did not participate in the decision. Both dissenters said the convention center didn't qualify as a "well-established resort hotel." Eakin said it is a convention center and, "No matter what the board here tried to shoehorn into the term, we know a duck when we see one, and for better or worse, the Convention Center is a duck, not a goose."

Adrian R. King Jr., the Ballard Spahr L.L.P. attorney for the Valley Forge investor group behind the casino, said the group "is pleased to receive news of today's Supreme Court decision."

"We look forward to welcoming patrons to this exciting new component of our first-class convention center resort hotel," he said. But King offered no firm timetable for the project.

The legal case underscored what some say is an increasingly saturated gaming market, and the cut throat nature of the gaming industry. In addition to Parx, the Philadelphia region is home to Harrah's Chester Casino and Racetrack in Delaware County, and SugarHouse on the Philadelphia waterfront. All three venues are accessible from I-95. In addition, a casino in Bethlehem is about 60 miles away. The Valley Forge casino would make the fifth one in the Philadelphia region.

While the case was in court for almost two years, the Valley Forge investor group was prevented from starting work on its casino.

King said the investor group likely will soon meet with the Gaming Control Board to discuss a development timetable. The group estimates that a new casino will produce $74 million in annual gross gaming revenue from slot machines by its fifth year of operation.

Under the state's gaming law, a Category 3 licensee - also known as a casino resort - may be eligible to operate up to 600 slot machines and 50 games such as poker, blackjack and craps. The state law also limits the use of such a casino to registered overnight guests in the on-site hotel, or among patrons utilizing one or more other amenities, such as the restaurants.

The Gaming Control Board is currently deciding on awarding the second and final Category 3 license. There are four applicants, with projects proposed for Gettysburg, Mechanicsburg, the Poconos and southwestern Pennsylvania. The board said it expects to make a decision within the next two months.


Contact staff writer Suzette Parmley at 215-854-2594 or sparmley@phillynews.com.

 

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