The Indiana General Assembly’s Interim Study Committee on Public Policy recently voted 9-0 to recommend that the 2019 General Assembly consider legalizing sports betting. During the 4-hour session, committee members discussed the level of taxation; who could be licensed to take bets; the types of bets allowed; major league integrity fees; betting restrictions; and more.
Committee members said the state’s 13 casinos would be the likely locations for sports betting, along with two racinos in central Indiana, and they also supported allowing online and mobile sports wagering. Bettors already can wager on horseraces via mobile devices or online, and also gamble using smartphones inside a casino.
Committee Chair and state Rep. Ben Smaltz said the committee’s vote is a neutral recommendation to continue to work on the complex issue of sports betting. “My concern is the weeds, the details, the data, the regulations, the funding. How is all that going to work?” he asked.
The Indiana Gaming Commission would regulate sports betting if it’s approved by the state legislature. IGC Executive Director Sara Tait told the committee sports betting “is something that has been successfully regulated elsewhere for years, so we’re not going to have to reinvent the wheel.”
Committee members heard the results of a report commissioned by the IGC, indicating within the first five years, sports betting, in-person and online, would create 2,281 direct and indirect new jobs and total $256 million a year, including $38 million to the state in annual new tax revenue in the fifth year, using a 9.75 percent tax on gross revenue plus licensing fees. In Nevada, sports betting operator keep only 4-6 percent of the total handle. “Sports betting is a low-margin business that appeals to a broad audience,” the report said.
Proponents also noted sports betting could help increase Indiana’s overall gaming market, since sports bettors tend to be younger and more affluent than the average casino patron. Also, legal sports betting could help eliminate bets placed through bookies and other illegal “black market” gambling operations. “On balance, we believe the risks associated with delaying sports betting beyond the 2019 legislative session clearly outweigh the rewards,” the report said. It added Indiana could lose money to the black market if it doesn’t offer mobile online betting, restricts wagers on college sports or sets the tax rate too high.
State Sen. Ron Alting, chairman of the Senate Public Policy Committee which oversees gaming legislation, said he expects a sports betting measure will be filed in January when the legislature reconvenes. Meanwhile he urged colleagues to continue to study sports betting in other states and talk to gaming experts and major sports leagues. “You definitely need to dot your I’s and cross your T’s on this. We don’t want to write ‘a’ bill, we want to write the best bill,” he said.
State Rep. Ben Smaltz, chairman of the House Public Policy Committee, said sports betting is not an expansion of gaming, in response to several conservative Republican legislators’ opposition. Smaltz said he considers sports betting as another option, like adding new slot machines. “My concern is that we need details and data, the regulations, the funding. How is all that going to work?” he asked.
Casino Association of Indiana President Matt Bell outlined for legislator what his group hopes for in terms of sports betting. He said the IGC should regulate sports betting; licensing fees should be reasonable and licenses limited to already-licensed casinos; mobile sports betting, wagering on in-state teams and in-game betting should be permitted; participants must be age 21 or older; the tax rate should be a “single digit”; and no integrity fees should be paid.
National Basketball Association Counsel Dan Spillane disagreed with the last point, causing some tense moments at the hearing. “We certainly are not saying that unless we get compensation from legislation that we’re not going to do everything within our power to protect the integrity of our sport. That’s absolutely not the case,” he said. But he said the NBA will need to invest additional resources to monitor integrity since sports betting is being forced on the leagues against their will.
State Rep. Jim Lucas responded, “You should be working — and it sounds like you are — working hard to maintain that integrity. I don’t understand that more pressure is going to be put on you if somebody else is betting on it. You should be maintaining that integrity no matter what, whether some somebody is betting a dollar on you or a million dollars on you. I don’t care.”
