In Ohio, sports betting legislation was introduced in both the Senate and House and a House subcommittee heard testimony on an online lottery bill.
Both the Senate and House bills would permit sports wagering at the state’s 11 casinos and racinos. The House bill was introduced by state Reps. Dave Greenspan and Brigid Kelly and the Senate version by state Senators John Eklund and Sean O’Brien. Governor Mike DeWine said he’ll let lawmakers work out the details of the competing proposals. “I’ll make my opinion known after awhile but I think this is good for the legislature to hold hearings and get different opinions about how to go about doing this,” he said.
The Greenspan/Kelly proposal would establish a Sports Gaming Advisory Board to initially provide research and recommendations to the Ohio Lottery Commission which would regulate sports betting. The commission currently regulates slots at seven Ohio racinos. The House bill does not address online or mobile betting. Greenspan said the bill is designed to be flexible, and could allow mobile wagering as it progresses. “What we’re doing with this bill is taking sports gaming out of the shadows and providing consumer protections,” Greenspan said.
Greenspan said sports betting revenue would be taxed at 10 percent, generating about $30 million annually to public education, according to estimates. Operators would pay a licensing fee of $100,000 upfront, renewable annually; veterans and fraternal groups would pay an annual fee of $1,000.
Greenspan noted, “At its core, this bill is intended to provide additional funding for public education in Ohio by making sports betting legal. The format and structure of the bill provides clarity as to the authority overseeing sport betting in Ohio while providing flexibility to address opportunities and challenges facing this newly legalized industry.”
The Eklund/O’Brien proposal in the Senate would allow online betting and assign regulation of sports betting to the Ohio Casino Control Commission, which oversees slots and tables at the state’s casinos in Cleveland, Cincinnati, Columbus and Toledo. Sports betting revenue would be taxed at 6.25 percent.
Eklund said, “I think there is a palpable difference between lottery games and sports gaming. The Casino Control Commission has an incredible level of expertise and knowledge about how to do it, how to do it safely, how to do it right. I think sports gaming is on a significantly more sophisticated level.”
Eklund added the House bill would create more bureaucracy and “ could wind up with the sports gaming tail wagging the sports gaming dog.” He noted the House bill would create a new bureaucracy with a sports gaming council “to advise the lottery on how to do this. That speaks volumes to me.”
Eklund said along with in-person betting, a mobile betting option was critical since “in today’s world people from the ages 18 to 35, 36, it’s getting older, 38, they do everything online. I think as a commercial enterprise you have to provide what your audience or customers want.” Online betting also would allow people living far from a casino or racino to be able to “enjoy that activity” and location-based technology would ensure bettors are within the state’s borders.
Eklund, who said he studied sports betting in other states for several months, added his bill would not allow sports wagering at gas stations or convenience stores. “You would not see sports betting cards in your 7-11 next to the Keno board,” he said.
He noted even if Ohio moves forward on sports betting, any new tax money it generates would be “a drop in the bucket” in the state’s budget. For example, he noted in Nevada, sports books account for just over 2 percent of the state’s casino gambling. In 2017 that totaled $248.8 million in winnings for the casinos and, at a tax rate of 6.75, less than $20 million in state taxes, according to state records.
Addressing problem gambling, Eklund said, “Will sports betting encourage people with a gambling problem to go out there and gamble? This activity already goes on in the United States of America through off-shore sports gaming sites. If somebody has a gambling problem, I feel very badly for them and their families. But if online gaming is what they want to feed their addiction, there is plenty of it out there.”
State Senate President Larry Obhof said he disagrees with Eklund over several aspects of his bill. He stated a constitutional amendment may be required to legalize sports betting. “We’ll let the legislative process run its course, but I don’t think it is a given that we will legalize” sports gambling, Obhof said.
However, Eklund said he considers his measure to be a starting point for legislative debate. “It’s kind of slowed down but I’m hoping that sometime in the very near term we’ll have the bill assigned to a committee and commence hearings soon,” he said.
Meanwhile, a House subcommittee heard testimony on an online lottery. Ohio Lottery Director Pat McDonald said, “By allowing additional methods of purchasing existing context, the lottery can keep up with the way people have become accustomed to buying everything from music and books to their groceries. It is imperative that the lottery continues to adapt and simplify the player’s experience to match current consumer purchasing trends. Likewise, the agency will continue to make it convenient for retailers and consumers to win cash prizes.” Lottery officials estimate online lottery games can generate an extra $45 million a year in state revenue and $100 million annually within five years.
Currently, the Ohio lottery only offers draw, instant ticket, monitor and terminal-based games and it regulates terminal-based games at the state’s seven racinos. Ohio would become the ninth state to offer mobile and online lottery games if the legislation passes.
Opponents to online lottery include brick-and-mortar retailers who are concerned the iLottery would cannibalize profits. Ohio Council of Retail Merchants lobbyist Alex Boehnke said told lawmakers,
“There are certainly some concerns about moving toward a mobile application. However, we’ll have to dig down into the fine details of any proposal before we take a position.” He added, “Our research shows that other states that have iLottery saw increased brick-and-mortar store sales.”
