Presque Isle Downs & Casino in potential danger of closing — Here's who it will impact

Yahoo

28-04-2025

(WJET/WFXP) – When Presque Isle Downs & Casino opened in 2007, not everyone welcomed the new attraction with open arms. But as time went on, the casino proved to be a good neighbor and a prosperous tourist attraction.
That is, until 2023, when skill games, which are similar to slot machines, became legal and not regulated by the state's strict casino laws. Now, they're popping up everywhere.
'New Year's Eve, busiest day of the year for us. I still have about 500 games that won't get played, because that's how far the demand has dropped off with all these other games on the market,' said Gary Hendricks, vice president and general manager of Presque Isle Downs and Casino. 'And of course, they're not paying, currently, a gaming tax. We pay a gaming tax, which is one of the highest in the country, is the highest in the country.'
Pennsylvania Casinos pay a straight 57% gaming tax, but once you take into account the yearly $10 million revenue share Presque Isle Downs must give to the Erie County Gaming Revenue Authority, plus administrative fees. Hendricks said that tax is actually about 64%.
'Let's say, your household income, you got taxed at 64%, you're going to probably be trying to live a different way, right? And that's where we are. We don't want to think about tough decisions in the future, but we have to consider possibilities,' said Hentricks.
Neighboring casinos in New York only pay 25%-30% tax, and Ohio pays 33%-43%.
Hendricks said that's why those casinos can offer more incentives, drawing players away from Erie.
Jennifer Mobilia: 'Is Presque Isle Downs and Casino in danger of closing?'
Gary Hendricks: 'We're concerned today about the long-term sustainability of the property.'
Hendricks said he's been sounding the alarm for three years to lawmakers in Harrisburg. Meanwhile, he's being forced to scale back, making Presque Isle Downs and Casino even less competitive.
He said since 2019, he's had to eliminate about 250 jobs.
Mobilia: 'What are the lawmakers from Erie County doing? Who's taking action?
Hendricks: 'That, I… at this point, I don't know.'
Mobilia: 'But you've been talking to them for over three years now, saying I need help, and nobody has done anything to help this place?'
Hendricks: 'Not to the best of my knowledge. I mean, Pat Harkins is on the Gaming Oversight Committee. He has multiple facilities, skill-based facilities near his properties in town, so he's aware of it. Yeah.'
Hendricks continued.
Hendricks: 'We're going to get to a point where it's the straw that's gonna break the camel's back. We don't know when that is, but we need some relief. And you need to understand that this is serious.'
Mobilia: 'What are some options to save money?'
Hendicks: 'You can only save your way to the bottom line for so long, and that's what we've been doing… But we've done things as I talked about, closing overnight in table games, not serving lunch during the day from the restaurant, we serve it from the End Cafe, which is a much smaller footprint and easier to manage with less labor.'
Mobilia: 'So it's not like you guys aren't trying.'
Hendricks: 'Oh no, we're. We're actively looking for opportunities. Yes.'
Mobilia asked Hendricks about cutting back on slot machines, but he said that by state law, the casino must have 1,500 slot machines operational at all times.
Mobilia: 'So the race track. How is that going?'
Hendricks: 'Race Track is always a struggle. There's not a lot of money in racing.'
Mobilia: 'Have you guys considered phasing out the racing?'
Hendricks: 'No, we're a category one, we're required to have racing.'
Mobilia: 'Okay. So that's not an option to save money?'
Hendricks: 'No.'
Hendricks said he has gone to Harrisburg multiple times to talk to lawmakers about the challenges his casino is facing.
Mobilia: 'Do you think they realize how serious this is?'
Hendricks: 'I think they do now.'
Mobilia: 'If you had a lawmaker sitting across from you right now, especially a lawmaker from Erie County, what would you say to that person?'
Hendricks: 'I would ask him to get active, to get a voice, to give us the voice.'
Meanwhile, reporter Nicole Lee spoke with stakeholders in Erie County who will be greatly impacted if the casino were to pull out.
The gaming revenue provides tremendous tax relief through school tax bills and supports nonprofits that make up the very fabric of our community.
Residents of Erie County who don't gamble may not pay much attention to Presque Isle Downs & Casino, but their school bills have been smaller because of it for years.
'It gives us property tax relief through school districts. We saw last year just $18.6 million in property tax relief. It also gives grants to ambulances and volunteer fire departments,' said Perry Wood, executive director of the ECGRA.
The largest portion of gaming revenue goes to Erie County government and the Erie County Gaming Revenue Authority. According to Wood, Erie County has received an estimated $392 million in tax relief to date.
The impact should this revenue not existing would be dramatic.
'Will it ultimately trickle down to the taxpayer? I believe it will. And like I say, not so much in Summit but Erie County would feel a big, a big hurt,' said Summit Township supervisor Jack Lee.
That hurt would go beyond residents' pocketbooks.
'ECGRA funding really serves as an anchor for all of our arts and culture organizations in the community,' said Zach Flock, executive director of the Erie Playhouse.
'So, what would happen to the philharmonic if this ECGRA money went away?' asked Lee.
'We would have a budget hole to fill,' said Amy Denlinger, finance director of the Erie Philharmonic. 'For example, the ECGRA funding we received this year to quantify things would pay for about four pops weekends at the Warner.'
'It goes directly towards taking care of our animals, providing excellent animal care. It goes toward our programming, it goes, for example, to putting on events like Glow Wild,' said Roo Johancie, president and CEO of the Erie Zoo.
'It would have a huge impact on the tourism industry as well as the community. And I hope we never have to have that conversation,' said Christine Temple, with VisitErie.
Clearly, the livelihood of the casino is critical to multiple segments of the community.
Mobilia and Lee will continue to keep an eye on the situation and push for answers at the state level.
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