Online poker supporters – and advocates of igaming – can look away from Indiana once again. For yet another year, Indiana lawmakers introduced a bill to legalize internet gambling, something that would assuredly deliver hundreds of millions of dollars per year in gaming revenue and tens of millions per year in first-year gaming taxes for the state.
And for yet another year, the penning of the bill and introduction of it appeared to mean little to nothing, as the bill languished in its initial committee without a hearing until it died there.
HB1536 appears to have no way forward in 2023. That means Indiana poker players will have to wait at least one more year for even the possibility that online poker could become a state-regulated offering in their state.
HB1536 Path to Death
From the first days of 2023, Indiana State Public Policy Chairman and Representative Ethan Manning were on board the online gambling train. State Senator Jon Ford was on the train, too. Both were on it in 2022, having introduced bills in partnership with other lawmakers. They all seemed ready to expand gambling revenue in Indiana by providing the state’s casinos and racetracks with another revenue stream and the state with additional tax revenue.
Oh, happy days.
The focus was on Manning’s 2023 bill – HB1536 – which he introduced on January 19. It went directly to the Public Policy Committee chaired by Manning himself.
One week later, Representative Jennifer Meltzer signed on as a coauthor of the bill.
And that was the end of the story of HB1536. Three hearing opportunities passed by without Manning putting the bill on the docket for discussion. For another year, an igaming bill died without even a hearing to put the cards on the table.
Supportive Studies
The Casino Association of Indiana and iDEA Growth – both supporters of state-regulated igaming in Indiana – commissioned a study by Global Market Advisors. The 2022 report showed the potential for igaming.
https://twitter.com/iDEA_Growth/status/1563992826681200640?s=20
In the first year alone, the market had could realistically generate $420M in annual revenue, out of which the operators would pay $75M in state and local taxes. Two years later, revenue could grow to $575M, and within five years, annual revenue should exceed $611M. With that, Indiana could rake in more than $100M in taxes.
The Indiana Gaming Commission countered with another study, one from the Spectrum Gaming Group. That one projected even higher igaming revenue over time, hitting $836M by the third year of operations. Even using two other methods for estimating revenue, the third-year number exceeded $820M each time.
Lawmakers saw this but looked to one section of concern, that of cannibalization. This is the theory that internet gaming would drain revenue from their land-based or river-based partners. This concern is often raised by igaming opponents, but all states with regulated igaming have thus far shown the theory to be unsubstantiated. In fact, online gaming not only helped states through the pandemic but most often boosts overall company revenue. Online promotions tend to bring more people into the casino properties. The study even concluded, “Based on results from the six igaming states, Spectrum does not expect igaming to negatively impact Indiana casino revenues.”
https://twitter.com/tribstar/status/1575440268005969926?s=20
Even so, some lawmakers decided that revenue cannibalization was a fair argument against igaming. Further, Indiana showed a budget surplus, so there was no need for additional revenue from expanding gambling in the state.
So You’re Saying There’s a Chance?
When Inside Indiana Business reached out to Manning for comment on the failure of HB1536, he did not respond. Considering he introduced the bill and ran the committee that could have put it up for discussion, he was ultimately responsible for the lack of movement on the proposal.
However, the publication noted that other lawmakers expressed hope that the bill will pass in the coming years. In fact, there is still a slight chance that igaming could latch on to another must-pass bill in 2023 and pass anyway. If it fails, though, it could be due to the fact that Indiana only legalized sports betting a few years ago, and that is plenty of gambling expansion for some lawmakers. Further, despite two positive reports on igaming potential, the Legislative Services Agency reported to lawmakers that cannibalization was a danger.
Oh.
It does sound like lawmakers still have a slim path ahead in 2023 but a more likely chance to bring it up for consideration again in 2024 and push forward.
https://twitter.com/StateAffairsIN/status/1631344254223097863?s=20
