Amended Casino, Sports Betting Bill Going To House Floor

Wednesday, April 10, 2019 at 8:39 AM

By Mike Perleberg @mikedup84

One more vote awaits Senate Bill 552, which could bring about sweeping changes to Indiana's casino landscape.

Indiana Statehouse

(Indianapolis, Ind.) - Southeastern Indiana casinos wanted to make their feelings known before the House Ways & Means Committee voted to advance a sweeping casino gaming and sports betting bill on Tuesday.

Senate Bill 552 passed the committee on a 17-6 vote. It now heads to the House floor with just over two weeks remaining before the 2019 lawmaking session must adjourn.

“There are a lot of parochial and sovereign interests,” said committee co-chairman State Rep. Todd Huston (R-Fishers) just ahead of the vote. “This is a jump ball. Do what you feel like is best for your constituency and the state.”

Under the approved measure, Terre Haute would be getting a casino by allowing casino companies to submit bids to the Indiana Gaming Commission for the license – assuming voters in Vigo County approve of the casino at the ballot box in 2019 or 2020.

The state’s two horsetrack casinos would be able to add live table game dealers in 2021, instead of this year as allowed in the Senate version of the bill.

The committee amended the bill to allow sports betting September 1, 2019, instead of the previous date of July 1, for those age 21 or older. The amendment also includes a requirement that the state use three percent of all sports betting revenue to help addicted gamblers. The license fee for a sports betting operation was reduced from $100,000 to $10,000. Sports books would only be permitted at Indiana’s casinos after the House Public Policy Committee in March stripped the bill of allowing sports bets to be made on mobile devices.

Legalized sports gambling – made possible for all states by a U.S. Supreme Court decision last year – would add a new revenue stream for the state government’s coffers. However, Huston tempered expectations in saying that sports betting will add only $12 million in tax revenue each year.

A new Terre Haute casino and live table games at the horsetrack racinos would bring about $30 million in new revenue.

Huston’s amendment also included a slight decrease in the wagering tax rate paid by casinos. He said he hopes the reduction will help make Indiana casinos more competitive with other states and encourage investment in Indiana. The estimation is that the wagering tax reduction will cut a total of $20 million each year from casinos’ state tax obligation.

Spectacle Entertainment, which would be combining its two Gary casino licenses into one, saw the bill amended to cut the proposed fee of cut in half to $50 million. The bill had previously been $100 million.

Huston acknowledge the nine-figure sum was burdensome for Spectacle.

“We felt like we needed to acknowledge that, and that's being acknowledged in the reduction from $100 million to $50 million,” he said.

Spectacle would be giving up its other license, which would be moved to the proposed Terre Haute location.

Other amendments proposed by Democratic committee members to protect various employees at the northern Indiana casinos were defeated on party-line votes.

Ahead of Tuesday’s committee vote, representatives of three Indiana casino companies testified on how SB 552 would impact their business.

Alex Stolyar, senior vice president for Rising Star Casino owner Full House Resorts, addressed the fiscal issues in the bill. He said the casino has had $5 million negative cash flow over the last two years. The company made back $16.5 million while investing $17 million into the Rising Sun property.

The addition of gaming in Ohio, Stolyar explained, has been the primary cause of hardship at Rising Star Casino. When Full House Resorts purchased the casino in 2011, Ohio had already passed a constitutional amendment legalizing casinos, including one in Cincinnati. However, two more casinos – Belterra Park and Miami Valley Gaming – in southwestern Ohio have turned Rising Sun into “a very challenged location.”

“At Rising Star, nobody has paid a greater share of profits to the State of Indiana than we have,” Stolyard said, lamenting that casinos are required to pay taxes based on their revenues and not their profits.

He asked lawmakers to consider whether any other casino in the state would switch positions with Rising Star Casino.

“Our ask is that, if we are going to stay in Rising Sun, that there is a modification to the wagering tax or you provide other ways to help us succeed,” Stolyar said.

Full House Resorts executives have expressed support for SB 552, mainly due to the provision that it creates a competitive bidding process for a casino company to bid on the license for the new casino in Terre Haute. The Las Vegas-based company has pursued a casino in the western Indiana city in recent years.

John Hammond, a lobbyist for Penn National Gaming, said the company has 900 employees at Hollywood Casino Lawrenceburg and 1,100 more at Ameristar East Chicago. Much of his testimony focused on how the relocation of one of Gary, Indiana’s two riverboat casinos to an inland location along a major highway would impact Ameristar’s revenues.

Boyd Gaming owns Belterra Casino Resort & Spa in Switzerland County, as well as Blue Chip Casino in Michigan City. The company’s vice president of governmental affairs, Ryan Soultz, said tax provisions in SB 552 do not offset the negative revenue impact on Blue Chip expected from a Gary casino relocation. He did not address any specific concerns for the Belterra property.

The 2,764 games allowed for an inland Gary casino would be about a third more than the games permitted at Ameristar and Blue Chip.

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