A top Indiana budget writer doesn't expect much of a state tax revenue boost if legislators approve proposals to legalize sports betting and allow new casinos in Gary and Terre Haute.
Sports betting is projected to bring in $12 million a year, with the new casinos and table games at horse track casinos near Indianapolis possibly adding about $30 million more, said Republican House Ways and Means Committee co-chairman Todd Huston of Fishers. That amounts to about one-third of 1% of expected state tax collections.
Ways and Means Committee members endorsed the gambling proposal in a 17-6 vote Tuesday, sending it to the full House for consideration.
The Indiana estimates come as tax revenue from sports betting has fallen far short of projections in four of the six states that legalized wagering after the Supreme Court cleared the way last year.
The Indiana revenue could be even less than projected because the current proposal would allow sports betting only at casino sites. A previous plan approved by the state Senate also permitted sports bets by mobile devices, but the House Public Policy committee stripped out that provision last month after committee Chairman Ben Smaltz of Auburn said he worried it was a significant expansion of gambling and could lead to traditional casino games moving online.
Despite the low revenue projections, Huston added changes to the tax rates paid by Indiana's current 13 casinos that he said could cut their tax bills by about $20 million a year.
"At the end of the day, we want to be competitive with our neighboring states," Huston said. "We want to see investments in Indiana, not in other states."
The plan going to the full House allows the owner of the current Gary casino boats on Lake Michigan to build a new casino in the city, along Interstate 80-94, after paying a one-time $50 million state fee. The Gary casino shift comes as Spectacle Entertainment, which is buying the two Majestic Star Casino boats in Gary, proposed a $300 million project building a new casino and 200-room hotel along Interstate 80-94 and shifting the second boat's casino license to Terre Haute.
But the current proposal would allow any casino operator to make bids for the Terre Haute license if Vigo County voters agree to a casino in a referendum.
Spectacle Entertainment is led by former executives of Centaur Gaming, which sold Indiana's two horse track casinos in Anderson and Shelbyville to Las Vegas-based Caesars Entertainment Corp. last year for $1.7 billion.
Gary officials say the casino move would also allow development of a cargo hub, with a Lake Michigan port and nearby railroads and highways to attract shipping business now going through Chicago.
The bill would allow sports betting to begin in September, although Huston said that might be pushed back so state agencies have more time to put regulations in place. Other provisions wouldn't allow table games with live dealers at the horse track casinos until 2021, rather than later this year as in the Senate-approved version.
Casino operators would need to bid at least $25 million for the Terre Haute license, with three finalists being selected by a local committee from submitted project proposals.
"I don't presume to know what the license value is," Huston said. "I'd like to see it be done in a competitive marketplace."