Pennsylvania Code & Bulletin
COMMONWEALTH OF PENNSYLVANIA

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The Pennsylvania Code website reflects the Pennsylvania Code changes effective through 51 Pa.B. 1118 (February 27, 2021).

58 Pa. Code § 441a.7. Licensing hearings for slot machine licenses.

§ 441a.7. Licensing hearings for slot machine licenses.

 (a)  A schedule of licensing hearings for all slot machine license applicants will be posted on the Board’s web site.

 (b)  The Board may schedule prehearing conferences under §  491a.9 (relating to prehearing and other conferences) to address issues related to licensing hearings.

 (c)  The Board will allot each applicant a specified time for its presentation. The length of the presentations, which shall be the same for each applicant within each category, will be established by the Board.

 (d)  At a licensing hearing, an applicant shall appear before the Board and at all times have the burden to establish and demonstrate, by clear and convincing evidence, its eligibility and suitability for licensure and to address the criteria identified in section 1325(c) of the act (relating to license or permit issuance).

 (e)  For the purposes of this section, an applicant’s demonstration of eligibility must include a showing of compliance with:

   (1)  Section 1302, 1303, 1304 or 1305 of the act, as applicable.

   (2)  The application requirements in §  441a.3 (relating to slot machine license application).

   (3)  The license fee payment bond or letter of credit requirements in §  441a.5 (relating to license fee payment bond or letter of credit requirements).

   (4)  The diversity requirements in Chapter 481a (relating to diversity) and section 1325(b) of the act.

 (f)  For the purposes of this section, an applicant’s demonstration of suitability must include a showing of:

   (1)  Good character, honesty and integrity in compliance with section 1310 of the act (relating to slot machine license application character requirements).

   (2)  Financial fitness in compliance with section 1313 of the act (relating to slot machine license application financial fitness requirements).

   (3)  Operational viability, including:

     (i)   The quality of the proposed licensed facility, and temporary land-based facility, if applicable, including the number of slot machines and table games proposed and the ability of the proposed licensed facility to comply with statutory, regulatory and technical standards applicable to the design of the proposed licensed facility and the conduct of slot machine and table game operations therein.

     (ii)   The projected date of the start of operations of the proposed licensed facility and any accessory uses such as hotel, convention, retail and restaurant space proposed in conjunction therewith. Applicants shall provide the Board with a time line on the deliverability of proposed temporary land-based or phased permanent licensed facilities and the accessory uses proposed in conjunction therewith.

     (iii)   The ability of the applicant’s proposed licensed facility to generate and sustain an acceptable level of growth of revenue.

 (g)  For the purposes of this section, an applicant’s demonstration of how it addresses the criteria identified in section 1325(c) of the act must include:

   (1)  The location and quality of the proposed facility, including, but not limited to, road and transit access, parking and the facility’s proximity to its anticipated market service area.

   (2)  The potential for new job creation and economic development which are expected to result from granting a license to an applicant.

   (3)  The applicant’s good faith plan to recruit, train and enhance diversity in all employment classifications in the facility.

   (4)  The applicant’s good faith plan for enhancing the representation of diverse groups in the operation of its facility through the ownership and operation of business enterprises associated with or utilized by its facility or through the provision of goods or services utilized by its facility and through the participation in the ownership of the applicant.

   (5)  The applicant’s good faith effort to assure that all persons are accorded equality of opportunity in employment and contracting by it and any contractors, subcontractors, assignees, lessees, agents, gaming service providers and suppliers the applicant may employ directly or indirectly.

   (6)  The potential for enhancing tourism which is expected to result from granting a license to the applicant.

   (7)  The history and success of the applicant in developing tourism facilities ancillary to gaming development in other locations if applicable to the applicant.

   (8)  The degree to which the applicant presents a plan for the project which will likely lead to the creation of quality, living-wage jobs and full-time permanent jobs for residents of this Commonwealth generally and for residents of the host political subdivision in particular.

   (9)  The record of the applicant and its developer in meeting commitments to local agencies, community-based organizations and employees in other locations.

   (10)  The degree to which potential adverse effects which might result from the project, including costs of meeting the increased demand for public health care and treatment of problem gamblers and their families, child care, public transportation, affordable housing and social services, will be mitigated.

   (11)  The record of the applicant and its developer regarding compliance with:

     (i)   Federal, State and local discrimination, wage and hour, disability and occupational and environmental health and safety laws.

     (ii)   State and local labor relations and employment laws.

   (12)  The record of the applicant in dealing with its employees and their representatives at other locations.

   (13)  The applicant’s business probity, experience and ability.

   (14)  Areas of deficiency in the applicant’s application previously identified by the Bureau or the Bureau of Licensing that have not been resolved.

 (h)  The applicant’s demonstration of how it addresses section 1325(c) of the act and subsection (g) may include information relating to its affiliates, intermediaries, subsidiaries or holding companies.

 (i)  No later than 30 days before the first scheduled licensing hearing in the category of license for which the applicant has filed an application, the applicant shall file with the Board a memorandum identifying all evidence it intends to use in support of its presentation before the Board. At the same time, Category 1 and Category 3 applicants shall serve the memorandum on the other applicants in the same category. At the same time, Category 2 applicants shall serve the memorandum on all other applicants whose proposed facility meets the same location criteria as the applicant’s proposed facility as specified in subsection (n)(1)(i)—(iii). The memorandum must include the following:

   (1)  The name of the applicant and docket number of the applicant’s application to which the evidence will relate.

   (2)  Identification of each standard and criterion in subsections (d)—(f) to which the evidence will relate.

   (3)  As to each criterion identified, whether the evidence will be presented through oral testimony or the proffer of documents, or both. If any portion of the evidence will be presented through oral testimony, the notice must include the name, address and telephone number of each testifying witness, the identified criteria about which the witness will testify and a detailed summary of the witness’ testimony. If any portion of the evidence will be presented through the proffer of documents, including reports and exhibits, the memorandum must include a copy of each document to be proffered and the name, address and telephone number of the persons who prepared the document.

   (4)  If any person identified in paragraph (3) will testify as an expert, the person’s qualifications, including the person’s education, experience and training, and a listing of the other jurisdictions where the person has been qualified as an expert witness within the last 5 years, shall be attached to the notice. A copy of the results or reports of any tests, experiments, examinations, studies or documents prepared or conducted by the expert or about which the expert will testify or which will be relied upon by the expert to render an opinion shall be attached to the notice.

   (5)  Documents required under paragraphs (3) and (4) that have already been submitted to the Board and made part of the public record may be referenced instead of being included with the memorandum identifying all evidence an applicant intends to use in support of its presentation before the Board.

 (j)  The Board will serve on all applicants within that category any expert reports developed for and requested by the Board that pertain to the applicants.

 (k)  Applicants, at the time of filing, shall provide the Board with an electronic version, in a format prescribed by the Board, of the reports and exhibits provided in paper form.

 (l)  If an applicant designates any submitted report or exhibit as confidential under §  401a.3 (relating to definitions) or section 1206(f) of the act (relating to Board minutes and records), the applicant shall:

   (1)  Clearly and conspicuously indicate that the report or exhibit is confidential in both the paper and electronic format and provide these exhibits separately from the nonconfidential exhibits.

   (2)  Request that the confidential information be presented to the Board in an executive session in accordance with 65 Pa.C.S. §  708(a)(5) (relating to executive sessions) and provide an explanation of the need for the designation of confidentiality and presentation during an executive session or authorize the release of the report or exhibit in compliance with section 1206(f)(5) of the act.

 (m)  Applicants are prohibited from relying upon or introducing new evidence, including witnesses’ testimony, reports or exhibits, not identified under subsection (i) or (n), except in the following circumstances:

   (1)  Applicants may update or supplement evidence, including witnesses’ testimony, reports or exhibits to respond to requests from the Board or Board staff.

   (2)  Applicants may update or supplement evidence, including witnesses’ testimony, reports or exhibits to respond to issues raised subsequent to the filing of the memorandum required by subsection (i) at a prehearing conference if the issues could not have been reasonably anticipated by the applicant.

 (n)  For Category 2 and Category 3 applicants only, in addition to the applicant’s presentation of evidence to the Board relative to its eligibility and suitability for a license, an applicant may, during its licensing hearing, present evidence which sets forth a comparison between the applicant and other applicants within the same category with respect to the standards and criteria in subsections (e)—(h).

   (1)  Comparisons must be limited to:

     (i)   For applicants seeking to locate a licensed facility in a city of the first class, other applicants for a licensed facility in a city of the first class.

     (ii)   For applicants seeking to locate a licensed facility in a city of the second class, other applicants for a licensed facility in a city of the second class.

     (iii)   For applicants seeking to locate a licensed facility in a revenue-enhanced or tourism-enhanced location, other applicants for a licensed facility in a revenue-enhanced or tourism-enhanced location.

     (iv)   For applicants seeking to locate a licensed facility in a well-established resort hotel, other applicants for a licensed facility in a well-established resort hotel.

   (2)  If an applicant desires to present comparative evidence under this subsection, the applicant shall, no later than 20 days prior to the commencement of the first scheduled licensing hearing in the category of license for which the applicant has filed an application, file with the Board Clerk a separate written notice evidencing the intent identifying each other applicant about whom the applicant desires to present evidence. A copy of the notice shall be served on the applicants about whom the evidence will be presented and on the Chief Enforcement Counsel. The notice must include:

     (i)   The name of the applicant and docket number of the applicant’s application to which the evidence will relate.

     (ii)   Identification of the standards and criteria in subsections (e)—(h) to which the evidence will relate.

     (iii)   As to each criterion identified, a copy of any document or evidence that will be used to support the comparison to be presented in compliance with subsection (i).

   (3)  An applicant served with notice under paragraph (2) may present, during its licensing hearing, comparative evidence concerning it and the applicant from who notice was received with respect to the standards and criteria in subsections (e)—(h). The applicant so served shall have 10 days following services to file a reply notice with the Board which contains the information required by paragraph (2). A complete copy of the reply notice shall be served on the applicant who initially served notice under paragraph (2) and on the Chief Enforcement Counsel.

   (4)  If the applicant plans to present evidence to the Board concerning another applicant in an executive session, the applicant shall provide notice to the other applicant and provide any report or exhibit relied upon to the other applicant. The other applicant may be represented in the executive session.

 (o)  At the discretion of the Board, an applicant’s presentation may include:

   (1)  Oral presentation.

   (2)  Documentary evidence submissions, including reports, photographs, audiovisual presentations, exhibits or testimony of witnesses.

 (p)  The Board, its designee and Chief Enforcement Counsel may:

   (1)  Examine or question the applicant and witnesses called by the applicant or the Board regarding their testimony and any aspect of the applicant’s application and relevant background.

   (2)  Recall the applicant and other witnesses called by the applicant or the Board during the licensing hearing for further questioning.

 (q)  A person who testifies at the licensing hearing shall be sworn and testify under oath.

 (r)  Information obtained by the Bureau during an applicant’s background investigation based upon public record or upon information otherwise in the public domain will be heard by the Board during the licensing hearing. Information submitted by an applicant under section 1310(a) of the act or obtained by the Board or Bureau as part of a background investigation from any source not in the public domain is considered confidential. The Board may not require an applicant to waive any confidentiality provided for in section 1206(f) of the act as a condition for the approval of a slot machine license or any other action of the Board. The Board may request that an applicant respond to inquiries related to confidential information during a licensing hearing to promote transparency in the regulation of gaming in this Commonwealth. An applicant who does not waive the right to confidentiality shall:

   (1)  Invoke the protection afforded the applicant under 4 Pa.C.S. §  1206(f) and have the matter heard in executive session.

   (2)  Provide the reason on the record explaining the basis for the invocation of confidentiality under §  407a.3(a) (relating to confidential information).

 (s)  At its discretion, the Board may terminate, recess, reconvene and continue the licensing hearing.

 (t)  An applicant may raise an objection to the conduct of the hearing, procedure, process or rulings of the Board as it relates to its own hearing or to the hearing of a competitive applicant as follows:

   (1)  An objection may be raised orally by stating the objection during the hearing of an applicant and the objection shall be stenographically recorded upon the record. The Board may request written briefing of the basis of the objection prior to issuing a ruling.

   (2)  An objection relating to the hearing of an applicant or to a hearing of a competitive applicant may be raised by means of written objection filed with the Clerk no later than 2 business days after the action or event giving rise to the objection. A written objection must clearly and concisely set forth the factual basis for the objection and be accompanied by a legal brief addressing the legal basis supporting the objection.

   (3)  If an applicant objects to an action or event in the hearing of another applicant, the caption of the objection must include the docket numbers of both proceedings conspicuously displayed and shall be served upon counsel for the other applicant by electronic means.

   (4)  In the event an objection is filed to the hearing of another applicant, counsel for that applicant may file a responsive brief within 2 business days of electronic service.

   (5)  An objection not raised as provided in paragraphs (1)—(3) will be deemed waived.

 (u)  Each Category 1 and Category 3 applicant may file a brief up to 25 pages in length within 10 days of the completion of the hearing with respect to all applications within its category. Each Category 2 applicant may file a brief up to 25 pages in length within 10 days of the completion of the hearing with respect to all applications that meet the same location criteria as the applicant as specified in subsection (n)(1)(i)—(iii). At the prehearing conferences, applicants in any category may waive the opportunity to file briefs.

 (v)  At the conclusion of the presentation of all testimony and evidence, the Board will cause the record to be transcribed. The transcript and evidence shall become part of the evidentiary record for the Board’s consideration. For good cause shown, the Board may seal portions of the record.

 (w)  Following submission of the applicants’ briefs, all applicants will have an opportunity to make final remarks in the form of oral argument before the Board in a manner and time prescribed by the Board. At the prehearing conferences, applicants in any category may waive the opportunity for oral argument.

 (x)  Upon the conclusion of the licensing hearings and upon review of the evidentiary record in its entirety, the Board will consider, approve, condition or deny the slot machine license applications. A final order, accompanied by the Board’s written decision, will be served on the applicants for slot machine licenses.

 (y)  An applicant may appeal the denial of a slot machine license to the Pennsylvania Supreme Court as provided in the act.

 (z)  This subsection pertains exclusively to intervention in a licensing hearing for a slot machine license under this section and is not applicable to other hearings before the Board. The right to intervene in a hearing under this section is within the sole discretion of the Board.

   (1)  A person wishing to intervene in a licensing hearing for a slot machine license shall file a petition in accordance with this subsection.

   (2)  A person may file a petition to intervene under this subsection if the person has an interest in the proceeding which is substantial, direct and immediate and if the interest is not adequately represented in a licensing hearing.

   (3)  Petitions to intervene in a licensing hearing may be filed no later than 45 days prior to the commencement of the first scheduled licensing hearing, in the category of license for which the applicant, in whose hearing the petitioner seeks to intervene, has filed an application unless, in extraordinary circumstances for good cause shown, the Board authorizes a late filing. At the same time the petitioner files its petition with the Board, a complete copy of the petition to intervene shall be served on the Chief Enforcement Counsel and the applicant in whose licensing hearing the petitioner seeks to intervene.

   (4)  Petitions to intervene must set out clearly and concisely the facts demonstrating the nature of the alleged right or interest of the petitioner, the grounds of the proposed intervention, the position of the petitioner in the proceeding and a copy of the written statement to be offered under paragraph (6). The petitioner shall fully and completely advise the applicant and the Board of the specific issues of fact or law to be raised or controverted and cite provisions or other authority relied on.

   (5)  The applicant may file an answer to a petition to intervene, and in default thereof, will be deemed to have waived any objection to the granting of the petition. If made, answers shall be filed within 10 days after the date the petition is filed with the Board, unless for cause the Board prescribes a different time. A complete copy of the answer to the petition to intervene shall be served on the Chief Enforcement Counsel and the petitioner who seeks to intervene.

   (6)  Except when the Board determines that it is necessary to develop a comprehensive evidentiary record, the participation of a person granted the right to intervene in a licensing hearing will be limited to the presentation of evidence through the submission of written statements attested to under oath. The written statements shall be part of the evidentiary record.

 (aa)  This section supersedes any conflicting provisions of Subpart H (relating to practice and procedure) and 1 Pa. Code Part II (relating to General Rules of Administrative Practice and Procedure).

Authority

   The provisions of this §  441a.7 amended under 4 Pa.C.S. § §  1103, 1202(b)(9)—(23) and (30), 1205, 1206(f) and (g), 1207(1) and (2), 1208, 1209(b), 1212, 1213, 1317(c), 1317.1(c), 1317.2, 1326, 13A11, 13A12—13A14, 13A15 and 1802 and Chapter 13.

Source

   The provisions of this §  441a.7 amended July 10, 2009, effective July 11, 2009, 39 Pa.B. 3451; amended October 22, 2010, effective October 23, 2010, 40 Pa.B. 6083; amended June 12, 2015, effective June 13, 2015, 45 Pa.B. 2829. Immediately preceding text appears at serial pages (353445) to (353452) and (367897).

Cross References

   This section cited in 58 Pa. Code §  491a.8 (relating to hearings generally); and 58 Pa. Code §  493a.12 (relating to intervention).



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