Gaming bills back; can gaming help to boost the budget, too?
Following a muti-year informal moratorium on gaming legislation imposed by legislative leadership due to an ongoing federal grand jury investigation of the relationship between the gaming industry and the General Assembly – and three former Republican lawmakers who have now completed serving federal prison time after pleading guilty to assorted gaming-related influence charges – gaming content was no longer designated legislatio non grata in the 2025 session.
There has been movement on some key pieces of legislation . . . and we’ll also caution you to keep a close eye on the budget bill as session ends for some components that could find their way in during the closing days, particularly as lawmakers look to raise some revenue.
We’ve been covering all of this in granular detail for readers of our Hannah News Service sister newsletter, INDIANA GAMING INSIGHT, so we’ll go use the wide macro lens in these pages.
The big omnibus gaming bill, authored by House Committee on Public Policy Chair Ethan Manning (R), would have, in pertinent part, legalized iGaming, online gaming for the Hoosier Lottery, authorized lottery courier services, reorganized how the state funded and addressed problem gaming services, and hiked the tax on mobile sports wagering. The measure was approved 9-2 in Rep. Manning’s committee, but by agreement (and concern that it could be hijacked by supporters of distributed gaming – the ubiquitous video gaming terminals) was not heard in the House Committee on Ways and Means on recommittal.
Some of the elements of this measure are still alive, most notably the lottery courier service, language for which this week found its way into a third different bill, this one an alcohol regulation measure with no other gaming elements.
The other major measure, this one authored by Sen. Andy Zay (R), would have allowed the underperforming casino in tiny Ohio County to move to New Haven, with deal cut with local governing bodies in both communities that were more than satisfactory to each for the exit from Rising Sun and reemergence in eastern Allen County (as well as a major eight-figure win for state coffers) . . . but some internal Senate Majority Caucus concerns over how Zay had handled the measure to the exclusion of local lawmakers forced a literal last minute hold on the bill in the Senate Committee on Public Policy despite what appeared to be overwhelming committee support.
As a consolation prize for Sen. Zay, he was afforded a vehicle bill to use for a study of a casino relocation . . . and, as it sailed through the House Monday, it would call for the Indiana Gaming Commission to engage a consultant for a study of the top two regions for a casino location or a new casino license by November 1 (IGC is on top of it; responses to a Request for quotations were due in mid-March). This also comes amidst whispers that another Native American tribe (one that our sister newsletter reported more than a generation ago was poking around in first in Lake County and then in Vigo County) is looking to get back in the game in the Hoosier State.
All eyes are on Indianapolis/Fishers and Fort Wayne as the two regions that will be identified for a potential casino.
Charity gaming received considerable attention this session, and lawmakers – much less the general public – do not understand how much money this activity generates. Charity gaming revenue in Fiscal Year 2024 hit $474,080,246, and it has topped $450 million annually for the past three years. In its 30 years of existence in Indiana, charity gaming has accounted for $14.7 billion in total revenue, with a high point of $585,498,274 in FY 2000 under an earlier legal rubric.
SB 108 would crack down on rogue operators by restricting a facility or location for a bingo event or a casino game night to no more than three calendar days per calendar week, and satellite or leased-out operations would not be allowed. Of importance to qualified organizations is that, for the first time ever, they would now be clearly authorized to use the net proceeds from an allowable activity for any lawful purpose – so, for example, a VFW post or Eagles lodge could use profits to fix a fridge or replace barstools. Certain larger operations would be required to submit periodic audits. A qualified organization would also be authorized to conduct an electronic raffle, subject to certain requirements. The bill was on Second Reading in the House at press time.
SB 209 is being billed as allowing for responsible modernization of charitable gaming. Electronic pull-tabs (machines or tablets) would be authorized for use in the primary lodge, hall, or meeting place of a veteran or fraternal organization that has existed for at least five years and has a charitable gaming license. The bill was heavily lobbied by veterans service organizations, and only the Casino Association of Indiana publicly opposed it. Device numbers would be limited depending on the seating capacity of the facility. On Wednesday, the author, Sen. Kyle Walker (R), filed a motion for concurrence with the House version of his bill.
So what else should you watch for?
In the end game, it’s all about the Benjamins, and fiscal leaders will be looking for new revenue sources.
While iGaming is almost certainly dead for the session, we expect that the Hoosier Lottery online game authorization will find its way into the budget despite not existing in any active legislation. “I continue to have conversations with legislators,” Hoosier Lottery Executive Director Sarah Taylor tells members of the State Lottery Commission of Indiana at a March 26 commission meeting. “The reception on that has been very good.”
You should also not be surprised to see an increase in the mobile sports wagering tax squeezed into the budget. While brick-and-mortar operations (whose revenue has been negligible since Illinois, Ohio, and Kentucky each adopted sports wagering, and whose operators actually employ people in Indiana) will be spared, there is sentiment to tax mobile wagering at a much higher rate than the current 9.5%, and a 20% rate s(as had been proposed in HB 1432, could be imposed without raising many eyebrows . . . and would still effectively leave Indiana with a lower rate than our neighbors.
There may also be a move to use the budget to claw back some of the complimentary play tax credits that have been extended (and expanded) over the years, and perhaps to end the practice of allowing casino operators to sell unused tax credits to other operators. Such a last-minute move, however, absent offering something in exchange to the industry would violate the longstanding informal agreement that has facilitated the symbiotic relationship between the state and the gaming industry by which lawmakers always make the industry whole if they exact a price.
Budget-making is always interesting, and this session it becomes even more fascinating now that the element of gaming revenue can again possibly be added into the mix. Keep a close watch on how gaming revenues may be tapped to help round out the budget or backfill holes.