Legislation introduced by Indiana state Senator Earline Rogers would
Indiana state Senator Earline Rogers recently filed Senate Bill 449 which would allow Indiana’s 10 permanently moored riverboat casinos to move onto land adjacent to their docks. Rogers’ bill, which was sent to the Senate Public Policy Committee, follows the recommendations of the General Assembly’s summer gaming study committee, led by state Rep. Tom Dermody, chairman of the House Public Policy Committee. The measure would permit land-based casinos with no more gaming positions than existed on the riverboats on July 1, 2014, a provision that answers the charge of “expanded gambling,” a position held by Governor Mike Pence.
Rogers’ measure also extends a casino tax deduction for promotional play, but does not include eliminating or replacing the casino admission tax or allowing live dealers the state’s two racinos. “That was the goal, to leave anything out that might be controversial,” Rogers said.
However, Dermody said legislation he is preparing, besides allowing riverboat casinos to move ashore, would replace the $3 admission tax; allow live dealers at the state’s two racinos, Hoosier Park Racing & Casino in Anderson and Indiana Grand Racing and Casino in Shelbyville; and establish a variety of tax incentives. “A lot of things will be open for discussion. Obviously, it’s a long process, and it will have to go to Ways and Means Committee as well because of the adjusted tax situation,” he said.
In the past few years, Indiana casinos have lost revenue due to increased competition from Illinois casinos plus the 18,000-plus video slot machines installed in Illinois bars. In fiscal year 2014, statewide gambling revenue fell by $99 million, or 13 percent, the lowest level since 2002, according to Indiana Gaming Commission.
Gaming analyst Ed Feigenbaum said, “In 2009, there were similar recommendations and state Senator Luke Kenley said everybody needs to give up their balkanized perspectives and realize there are going to be winners and losers with the legislation, but we need to take statewide perspective. Everybody said yes but when it came time to vote, they went their own ways and represented their local interests. There are so many unanswered questions about what the legislation will end up looking like.”
Hammond Mayor Thomas McDermott Jr. said he thinks the land-based casino idea might get more traction this year. “Most people who I talk to think it’s a reasonable proposal. The gaming laws were created in 1993, but the industry has evolved and it’s time for us to take the next step.”
Still, he’s opposed to changing admission taxes. Hammond receives up to $7.5 million in admission tax revenues annually from Horseshoe Casino, accounting for most of the Hammond Port Authority’s budget, McDermott said. “I keep hearing from legislators in Indianapolis about them taking more and more away from municipalities in the name of cutting taxes, but pretty soon there’s going to be nothing left for essential services. Indianapolis is making it impossible to run cities,” McDermott said.
Pete Liguori, chief executive officer at the Majestic Star Casino in Hammond, said changing the law would allow Majestic Star to build a new casino for $95- $135 million, providing 1,900 construction jobs. “It’s almost a job protection initiative. We’re trying to stop a decline in revenue that has been consistent,” he said.
Another bill recently introduced in the Indiana legislature by state Rep. Alan Morrison would allow sports betting at casinos, racinos and off-track betting parlors. Sports betting is illegal in most of the nation outside of Nevada. Morrison also introduced a bill to permit wagering on fantasy sports games at the state’s two racinos.
Morrison, who holds a master’s degree in sports management, said, “Gaming is something that this state has become extremely reliant upon, that revenue. As it’s been trending down, it’s incumbent upon us to figure out how to fix it or to improve on what we have. If it were to become legal in July, let’s say, that would back us up another year before we could start the process. So if we have it on the books, where it’s up to our Gaming Commission, then we’d be ahead of the game on that.”
Morrison added Indiana would be unique, or “at least first to the table,” if it offered sports betting, which the state Legislative Services Agency estimated could generate $12-$70 million in annual tax revenue. He said NBA Commissioner Adam Silver has estimated illegal sports gambling in the U.S. amounts to $400 billion annually. “There’s a lot of money that floats around out there, where if it were captured in some form or fashion, and revenue is able to be realized for the state, it could mean a lot,” Morrison said.
Other legislators, however, are opposed to Morrison’s measures, and so is the Indianapolis-based NCAA. Morrison said he met with NCAA officials. “I certainly understand and respect where they’re coming from. But, again, if this changes nationwide, I would imagine that most states with gaming would add sports wagering to their gaming activities. The NCAA probably would have to take a look at their stance and understand it’s time to change.”
Declining gambling revenue also is impacting off-track betting. In fact, Centaur Gaming announced its off-track betting parlor in Merrillville will close on March 15. Opened in 1995, it originally was owned by Churchill Downs Inc. and operated under the name Sports Spectrum. It’s the third wagering facility to recently close in the U.S. Atlantic City Race Course in New Jersey said it will end year-round simulcasts and its short live meet. Trackside at Quad City Downs, an OTB facility in northwestern Illinois that once hosted live harness racing, also announced it plans to close.
Centaur president and chief operating officer Jim Brown said, “The decision to close the Merrillville off-track betting facility was given much consideration of its complete impact, not only to our loyal customers and team members but to our host community as well. Unfortunately, diminished business levels have made it no longer viable to maintain an off-track betting operation in the area. Centaur Gaming would much rather be in the position of adding to our workforce right now. However, the growth in online race wagering as well as increases in Indiana, Illinois and Michigan competition have resulted in a decline of more than 50 percent in the Merrillville OTB’s race wagering over the last 10 years.”
Centaur, owner of Indiana Grand Race Course & Casino and Hoosier Park Racing & Casino, operates other OTB facilities in Clarksville and Indianapolis, where, Brown said, Centaur is “in the process of reinventing the off-track betting experience through the Winner’s Circle Brewpub & OTB concept. Although Merrillville is not the right location for the Winner’s Circle concept, Centaur Gaming would be interested in adding to the Winner’s Circle portfolio in the future if the right Indiana location and opportunity were to present itself.”
