Ohio Legislative Committee Conducts Introductory Exploration Of Online Casino

Ohio lawmakers considered the prospect of online casino legalization for the first time Tuesday.

The newly formed Study Commission on the Future of Gaming in Ohio discussed online casino in the first of four scheduled meetings. Subsequent meetings will address iLottery, racinos/charitable gaming, sports betting and daily fantasy sports.

The eight-person joint committee is led by Rep. Jay Edwards and Sen. Nathan Manning. Edwards previously told PlayUSA that he did not expect the Ohio online casino discussions to lead to legislation this year. These were preliminary talks to inform possible future legislation.

Tuesday’s hearing was not live streamed or recorded. Only Matthew Schuler, executive director of the Ohio Casino Control Commission and Michelle MacGregor on behalf of the Sports Betting Alliance spoke in person.

PlayUSA reviewed written testimony submitted by those three, along with representatives of Boyd Gaming, Caesars Entertainment, iDEA Growth and Playtech and the Problem Gaming Network of Ohio.

Jeff Facemyer, legislative assistant to Edwards, told PlayUSA that the hearing lasted about two hours.

“The members were pretty uninformed about what iGaming, so the SBA was informative on what it encompases as well as the kind of revenue iGaming is bringing to states similar to Ohio. I think those were questions from the committee along with what increases are seen in problem gambling when iGaming is implemented.”

Reasons Ohio should consider online casino legalization

MacGregor presented that the regulatory framework and technology for online casino already exists in Ohio with online sports betting. Ohio launched online sports betting on Jan. 1, 2023.

She cited an American Gaming Association study estimating that Ohio’s illegal iGaming market equates to $621 million annually in gross gaming revenue.

Ryan Soultz, Boyd vice president of governmental affairs, argued that a key policy consideration when Ohio legalized online sports betting was to curtail the unregulated, offshore sites that Ohioans were utilizing. And the same reasoning merits regulating Ohio online casinos. The written testimony included a screenshot of a Google search for “Ohio online casino” resulting in an illegal offshore platform at the top.

By legalizing online casino, MacGregor suggested that Ohio could generate between $205 million and $410 million annually in new tax revenue.

iDEA Growth cited a study conducted by Vixio in collaboration with Light & Wonder suggesting Ohio online casino would produce $255 million in annual tax revenue based on the 20% tax rate the state uses for online sports betting.

Boyd suggested a tethered model with multiple skins per property and a tax rate of 15% or 17.5%.

Regulating online casino could help problem gamblers

Charmaine Hogan, head of regulatory affairs at Playtech, stressed how regulated iGaming can help identify and help people with problem gambling issues.

“We believe that this should also encompass robust means of proactively preventing harm by means of data/technology (quantifiable/automated) together with support and treatment for those players that do experience harm. … These require that operators employ player analytics and technology to spot problematic gambling patterns early on. This is a data driven approach that allows for personalized interventions based on actual observed behavior.”

The Problem Gambling Network of Ohio didn’t take a position on the state legalizing online casino.

Derek Longmeier of the Problem Gaming Network of Ohio. It merely requested that any future exploration Ohio takes into expanding gaming includes presentations from the Ohio Department of Mental Health and Addiction Services, gambling treatment providers, as well as those with a gambling disorder in long-term recovery.

Cannibalization concerns addressed

iDEA Growth and Boyd both pointed to a recent Eilers & Krejcik study showing iGaming’s positive effect in all six states that offer online casinos.

Boyd highlilghted that the study showed:

1. Total brick-and-mortar revenue increased in all states that implemented iGaming.
2. States that adopted iGaming saw their brick-and-mortar gaming revenue grow at a higher rate than those states that only had brick-and-mortar gaming.
3. Adding iGaming increased brick-and-mortar casino revenue.

Boyd, which operates Belterra Park in Cincinnati, contended that iGaming can benefit both state and existing gaming revenues. Soultz wrote:

“We see iGaming as a natural step in the evolution of the gaming industry. We believe that it is highly complementary to our existing land-based operations, and an opportunity to engage our customers while they are not physically at our properties. We have seen benefits with customer acquisition, retention, and marketing from our Stardust iGaming platform in Pennsylvania where we also operate our Valley Forge Casino near Philadelphia.”