The talk in Ohio of an online casino bill has turned into action, and a new proposal would charge licensees different rates depending on the operator brand they use.
Sen. Nathan Manning filed a bill on Tuesday that would legalize online casino gaming, as well as online lottery games and online wagering on horse racing.
SB 197 sets a high price for doing business, particularly for license-holders who choose to partner with an outside sportsbook, as Manning detailed at a brief first reading of the bill in the Senate Select Committee on Gaming.
Existing brick-and-mortar casinos who use an online casino platform that they own at least 50% of (think Caesars or PENN Entertainment) would be taxed at 36% and would pay $50 million for a five-year license fee, with a $5 million renewal fee. Untethered license-holders who use a third-party platform would have to pay twice as much for a license ($100 million initial fee, $10 million renewal), and would be taxed at 40%.
That higher rate would make Ohio the highest-taxing open-market online casino state, beating Pennsylvania’s 36%.
Meanwhile, other provisions would include halving the retail betting tax rate to 10%, banning use of the word “free” in advertising and prohibiting ads on college campuses, as well as a range of mandatory player safeguards.
Manning predicted legalizing online casino would bring in anywhere from $300 million to $1 billion in annual revenue for the state. In the bill’s current form, 99% of online casino tax revenue would go into the state general revenue fund and the remaining 1% would go towards the problem gambling fund.
“We kind of put this together very quickly, but I will say we’ve been working on this for years,” added Manning in the hearing.
Are lawmakers’ attitudes changing?
That revenue potential, as well as the idea of bringing existing unregulated online casino gambling under state oversight, has been key to what appears to be something of a shift in Ohio lawmakers’ attitudes towards online casino.
Senate President Rob McColley and House Speaker Matt Huffman both suggested this week, per Statehouse News Bureau, that the chambers are prepared to discuss the bill seriously.
“In some sense, I think as a state we’ve sort of turned the corner and said, ‘we’re going to raise money from gambling,'” said Huffman. “… What I think public officials and most of the public recognizes is that people want services and they don’t want to pay taxes. And how do you solve that conundrum? One way is raise revenue in a different way, and one [of those different ways] is through gambling.”
While both McColley and Huffman are Republicans, the push seems to have bipartisan interest. Democrat Senate Minority Leader Nickie Antonio pointed to other states’ revenue generation and how that can support in-state services. “I think it’s important for us to look at,” she said, per Statehouse News Bureau.
Key House politician working on own bill
While Manning’s Senate bill has officially begun discussion, a similar measure could soon land in the House.
That chamber’s Finance Committee Chair Rep. Brian Stewart is working on his own piece of online casino legislation with the aim of generating revenue for the state. That comes after the Stewart’s House version of the budget stripped out Gov. Mike DeWine’s plan to double the state’s sports betting tax rate from 20% to 40%.
