Pa. Supreme Court Upholds License for Nittany Mall Casino

The state's highest court has upheld the Pennsylvania Gaming Control Board's decision to award a license for a planned casino at the Nittany Mall , paving the way for the project to move forward.

Pennsylvania's Supreme Court in an opinion issued Wednesday found the board acted properly in awarding the license to Ira Lubert at a 2020 auction , dismissing a challenge brought by losing bidder Stadium Casino.

Stadium, a subsidiary of Baltimore-based Cordish Companies, has 14 days to file a motion to reconsider.

The project can now move ahead unless the decision is appealed to a higher court, PGCB spokesperson Doug Harbach said.

"The Gaming Control Board was confident in the legal manner in which it awarded the Category 4 license in College Township, and we appreciate the ruling by the Supreme Court backing our process," Harbach said. "We are pleased that this project can move forward and begin to generate tax dollars and provide employment in the future."

It's not yet clear whether Stadium will appeal further, and an attorney representing the company did not immediately respond to a message seeking comment.

Lubert , an investor, Penn State alumnus and former university trustee, won the September 2020 auction to apply for Pennsylvania's fifth category 4 casino license with a bid of $10 million and formed SC Gaming as the owner. In January 2021, Bally's announced it was partnering with SC Gaming to develop the casino in what was later revealed to be the former Macy's location at the mall in College Township.

State law for Category 4 casinos requires bidders to have ownership in existing casinos in Pennsylvania, and Lubert was eligible because of his ownership interest in Rivers Casino Pittsburgh.

Stadium argued that the PGCB should never have been able to consider Lubert's bid because, though he paid for the bid from his personal account, other parties who would not have been eligible to bid contributed to the funds, including local developer Robert Poole and Penn State trustee Richard Sokolov. Lubert had acted as "a Trojan horse for hire" by exchanging ownership interests for funding, Stadium alleged.

PGCB and Lubert countered that financial interests do not equate to ownership, and that any change of control would require board approval after an application process.

After filing a petition for review in 2021, Stadium appealed the PGCB's January 2023 decision to award the license after a hearing in which it was permitted to offer a presentation as an intervenor, but denied requests for discovery or to question witnesses.

In the opinion issued on Wednesday, state Supreme Court Justice Christine Donohue wrote that Lubert met the requirements to make payment of the bid amount within two days and file an application with in six months. The PGCB had no requirement or mechanism to investigate his eligibility at the auction stage, she wrote.

"The absence of a mechanism by which to challenge a bidder’s eligibility at the auction stage is not surprising, considering the in-depth investigation performed by various divisions of the Board to vet slot machine license applicants," Donahue wrote. "The Gaming Act imposes significant requirements concerning both the content and scope of slot machine license applications.

"Through this proceeding, the ownership structure of any entity proposed to hold a slot machine license is scrutinized. Moreover, third parties have the ability to intervene in licensing proceedings, as Stadium did here."

When construction might begin on the estimated $130 million casino project is not yet known. Bally's previously stated that when it commenced work was expected to take about a year. College Township has already approved a land development plan for the project.

"The Board's role now is to work with SC Gaming on the development of the project in following regulations and to monitor the process through the point of when they are prepared to hold test sessions and open to the public," Harbach said.

According to plans detailed at an August 2021 public hearing , the casino in the 94,000-square-foot anchor spot at the mall will operate 24 hours a day, seven days a week. It will have 750 slot machines, 30 table games and sports betting along with a sports-themed restaurant and bar with an entertainment stage and a multi-outlet quick-serve food court.

The casino would have two exterior public entrances and one from inside the mall and would only be open to individuals age 21 and older, including for the restaurant and food court. ID scanning will be employed at each entrance.

Wednesday's court decision dealt a blow to a contingent of community members who have opposed a casino in Centre County, citing concerns about increased crime, negative effects on other businesses and gambling addiction. About 3,300 people signed a hard copy petition and online petition against the casino.

"Many people in our community remain steadfastly opposed to the development of this casino," Andrew Shaffer, a State College resident and member of the the community group Say No Casino , wrote in an email. "The prevalence of gambling addiction and the damage it is causing to people in Pennsylvania has significantly increased during the past few years, especially among college students and other young adults. Building a casino just 3 miles from the Penn State campus at which virtually every Penn State student will be legally allowed to gamble before they graduate will only throw gasoline on a fire that is already burning out of control."

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