Georgia Gaming Market Assessment - Pennsylvania Treasury
Georgia Gaming Market Assessment - Pennsylvania Treasury
Georgia Gaming Market Assessment - Pennsylvania Treasury
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Implications<br />
The assumptions for development costs and EBITDA in the financial analysis are not projectspecific<br />
but general terms based on industry norms. The purpose of the financial analysis was to<br />
provide a range wherein ease of feasibility could be compared across the alternative locations. It<br />
is possible that developers of projects in the Small category could obtain better financing terms<br />
or construction costs than assumed, and that management could obtain better EBIDTA margins<br />
than assumed.<br />
The $66.5 million license fee and <strong>Pennsylvania</strong>’s effective gaming tax rate would challenge the<br />
feasibility of the locations falling into the Small category, including Altoona and Valley View, ∗<br />
which were the two leading locations outside the Eastern region in terms of net revenue gain to<br />
the Commonwealth.<br />
The leading locations in the East in terms of net revenue gain—South York and Reading—are<br />
toward the higher end of the range for feasibility. It should be again noted that the analysis is<br />
based on only one development in each region; therefore the revenue forecast and net revenue<br />
gain would be less if both Reading and South York were developed given their proximity.<br />
∗ In the Youngstown scenario.<br />
The Innovation Group Project #054-11 August 2011 Page 88