Indiana Governor Mike Pence’s desk last week allowed HB 1540 to become law without signing it, which would help the state’s 11 casinos compete against the increasing number of gaming options in surrounding states, including thousands of video gaming terminals in Illinois and the threat of a potential Pokagon Band of Potawatomi Indians casino in South Bend.
House Speaker Brian Bosma said the sticking point in the bill never was moving riverboat casinos to land. “Coming onto land for the boats, we were all in consensus on that as not being an expansion, including the governor, in the way it was done,” Bosma said.
Governor Pence, however, had indicated he considered allowing live dealers at the state’s two racinos to be expanded gambling, which he would veto. As a result, the final version of the bill sent to Pence moves allowing live dealers to 2021, after Pence would leave office providing he wins a second term.
Meanwhile, Pence vetoed a bill that would have permitted online betting on races run at the two Indiana horseracing tracks. Pence said he has long opposed any sort of online gaming and approving such a bill would have violated a pledge to oppose any expansion of gaming in his state, which is the reason that the live dealers provision got delayed until Pence’s prospective term is completed.
Tropicana Evansville General Manager Jason Gregorec said the bill represents a contraction, and not an expansion, of gaming, because for the first time state law would sets a cap on the number of gaming positions for casinos. Gregorec said construction on a new land-based facility at Tropicana could begin this year.
At Horseshoe Hammond Casino, Senior Vice President and General Manager Dan Nita said only help a few operators will benefit from moving ashore, and that ultimately the bill will not help Indiana casinos fight out-of-state competition. “This bill will only move people among the casinos in Indiana. It won’t move people to Indiana,” Nita said. He added he had hoped a provision would be added to the bill to ease casino taxes, something that help all the state’s casinos. Currently, Nita stated, casinos are double-taxed on gaming revenues and on income. “We’re paying taxes on taxes,” he said.
At Ameristar Casino in East Chicago, Vice President and General Manager Matt Schuffert said the bill will allow nearby Majestic Star Casinos in Gary to build a land-based casino on its Buffington Harbor property. “We are extremely appreciative of the legislature and its continued efforts to help us compete with neighboring states,” Schuffert said.
Ed Feigenbaum, editor of Indiana Gaming Insight, speculated that Ameristar casino does not have a large enough property to accommodate a new casino.
Feigenbaum noted studies indicate customers prefer land-based casinos over riverboats because they have higher ceilings, are designed as one story and usually are located next to parking lots.
He added the Indiana legislation has other provisions that will help every casino in the state. For example, larger casinos will benefit from promotional credits increasing from $5 million to $7 million a year. Feigenbaum noted some smaller casinos did not use even the $5 million credit. David Strow, spokesman for Boyd Gaming Corporation, parent company of Blue Chip Casino in Michigan City, said the promotional credits increase “helps level the playing field with casinos in competing states and it helps us better market ourselves,” Strow said.
Feigenbaum also noted the bill recommends an interim study be done this summer on how the riverboat admissions tax, economic development agreements and statutory wagering tax rates affect the ability of Indiana’s casinos to compete.
Lawmakers also passed a last-minute amendment requiring any gaming compact the governor reaches with an Indian tribe be approved by the Legislature. And they also passed a resolution calling on the U.S. Congress to change federal law to prohibit Indian tribes from opening casinos in the state. Essentially the legislation would prohibit the Pokagon Band’s proposed $480 million casino project in South Bend.
The South Bend Common Council on April 13 unanimously adopted a resolution supporting the Pokagon plans. The tribe has applied to the U.S. Bureau of Indian Affairs to take into trust 166 acres of land to develop a casino, 18-story, 500-room hotel, meeting space and tribal services. The project would create 1,400 construction jobs and 2,000 permanent jobs, and generate an estimated $620.4 million in annual revenue.
State Rep. B. Patrick Bauer of South Bend said, “Obviously there are gaming interests that don’t want the competition.” The tribe issued a statement noting, “The resolution is the latest example of the government of Indiana not understanding the Pokagon Band’s tribal sovereignty and the federal government’s trust responsibility to Indian nations. The tribe would prefer to move forward by working with state officials on the restoration of Pokagon lands in Indiana.”
