Sports Betting Still Faces Hurdles in Indiana

Indiana flag

Legal sports betting’s chances look to be improving in Indiana, but there are still some major hurdles that need to be overcome.

With each of its neighboring states debating the legalization of sports betting, Indiana does not want to be left out.

Kentucky, Michigan, Illinois, and Ohio are all going to consider legalization when their 2019 legislative sessions begin. Whichever of these states pushes through a sports betting bill first will likely garner an additional advantage by being the first to open a legal sportsbook.

Gambling in Indiana

Currently, 14 casinos are in operation throughout Indiana. They are a combination of land- and river-based facilities. The state had no lottery until 1988 and riverboat casinos were given the green light to open in 1993.

The two racetracks in the state, Hoosier Park and Indiana Downs, both began offering slot machines in 2007. In 2015, the riverboat casinos were given the go-ahead to open facilities on land. Now the state is considering adding sports betting.

Progress to date

A lot of politicians are confident that sports betting legalization would be a good thing for Indiana.

The Las Vegas consulting firm Eilers & Krejcik is conducting a study into the potential effects of sports betting in the state. So far, the indications are in favor of sports betting.

A few ideas for sports betting bills have been going the rounds in Indiana. Proposals would subject operators to a 9.25% tax on revenue.

Some are pushing for an integrity fee for some of the major sports leagues. The fee would be 1% of each wager on a sports event, with the proceeds going to the league. The NBA and MLB have been lobbying vigorously for such a fee throughout the country. So far, no integrity fee has made it into a final version of a sports betting bill.

It is not a very popular idea because it cuts too much into the bottom line of the operator. It would act as a disincentive for those in the sector to put a lot of resources into their sportsbooks, which would, in turn, lead to lower revenues for the state.

Positive signs

The Interim Study Committee for Public Policy in Indiana is giving its support to legalization. Committee members voted unanimously in favor of legalization of sports betting. A Republican representative, Ben Smaltz, is urging caution saying that there are “many perils down the pathway before it becomes law. My concern is the regulations, the funding.”

However, the executive director for the Indiana Gaming Commission, Sara Tait, believes that they can copy the blueprint of other states that already have legal sports sportsbooks.

The Eilers & Krejcik Gaming report says that Indiana should move quickly to legalize sports betting to prevent the black market from becoming entrenched. The report says: “On balance, we believe the risks associated with delaying sports betting beyond the 2019 (legislative) session clearly outweigh the rewards.”

The report also favors mobile betting and recommends against high tax rates.

Potential hurdles to sports betting

One of the key decisions is deciding who can place sports bets. Currently, a person has to be at least 21 years old to gamble in the state’s casinos. However, the minimum age to place a horse racing bet or buy a lottery ticket is only 18 years. Senator John Ford is pushing for 21 years to be the legal age for placing sports bets.

The casino sector in Indiana approves of this minimum age requirement. The NCAA is calling for a prohibition on betting by players, coaches, sports administrators, and game officials.

The main issue is where sports bets will be made. Indiana’s Casino Association wants sportsbooks only at those establishments that already have a racino or casino license because they already have proven to be responsible and well able to handle these types of offerings.

However, there is also a lot of outside interest in having new groups enter the market. The issue of the legal framework for sports betting needs discussion before choosing the operators.

Another major discussion will revolve around mobile sports betting, which is proving to be more popular in New Jersey than placing sports bets at offline venues. Online horse racing betting is already legal in Indiana.

Another question needing answering is whether certain games cannot be bet on. In Delaware and New Jersey, bettors cannot place bets on in-state teams.

However it finally takes shape, many in Indiana hope to have sports betting up and running by July 2019.