Breaking Away

Indiana is one of the best candidates to legalize online casinos, but that's not the only gambling policy the legislature will consider in 2025.

Jan 21, 2025

THE LEDE: Indiana is inundated with gambling bills, including online casino legalization and a sports betting tax rate hike.
BEYOND the HEADLINE: Land-based casino bills offer IN and VA a second chance at online casino legalization.
LEGAL and REGULATORY ROUNDUP: Bills, bills, and more gambling bills.
VIEWS: Is NJ’s sweepstakes legalization bill the solution to a difficult problem?
AROUND the WATERCOOLER: Sports bettors run into deposit problems.
STRAY THOUGHTS: Compare and contrast.

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The Lede: Indiana Gambling Bills: Good, Bad, and Ugly

Indiana already has three separate gambling bills on its calendar. One (The Good) would legalize online casinos and lottery, another (The Bad) would prohibit election betting, and a third (The Ugly) would raise the state’s sports betting tax rate.

THE GOOD: Indiana State Rep. Ethan Manning Filed HB 1432, which would legalize online casinos and lottery sales.

The first stop for Manning’s legislation will be the House Public Policy Committee, which he chairs.

As noted last week, the bill is a comprehensive gambling expansion package designed to bring several stakeholders on board, including the Indiana Lottery and charity gaming, as in addition to online casinos, it would legalize online lottery sales and pull tabs.

Under HB 1432, online casino licenses would be available to:

A licensed owner of a riverboat.
An operating agent operating a riverboat in a historic hotel district.
A permit holder conducting gambling games at the permit holder's racetrack.

A license costs $500,000, with an annual renewal fee of $50,000. The tax rate is 26% in Year One, followed by a graduated tax rate between 22% and 26% based on GGR. An annual $250,000 fee per licensee is also earmarked for problem gambling resources.

THE BAD: Indiana State Rep. J.D. Prescott introduced HB 1532, which would prohibit election betting.

Election betting is becoming an increasingly hot topic (recall my writeup of the Massachusetts election betting bill yesterday). While the federal government is trending positively, two states, Massachusetts and now Indiana, are looking to prohibit the activity to some degree.

Of note, the legislation would not prohibit prediction markets; it would only prohibit licensed sportsbooks from adding election markets.

The summary of HB 1532 reads:

“Provides that a sports wagering certificate holder or vendor may not accept wagers regarding the outcome of an election. Provides penalties for a certificate holder for advertising sports wagering.”

THE UGLY: Indiana State Sen. Fady Qaddoura introduced a bill, SB 394, which would raise the tax on sports betting operators from 9.5% to 11%.

Indiana is the latest state to propose increasing its sports betting tax rate. However, unlike Ohio and Illinois, Indiana lawmakers are following in the footsteps of a failed effort in Michigan at the end of 2024, proposing a more modest increase. The Indiana bill would raise the rate from 9.5% to 11%.

Maryland is another state considering increasing its sports betting tax rate. Under Gov. Wes Moore’s budget proposal, the rate would increase from 15% to 30%.

Bonus points if you get today’s title reference.

Beyond the Headline: A Backdoor Option in Two iCasino Candidate States

Indiana and Virginia are both candidates for online casinos. The straightforward path is via a bill (lawmakers have already filed legislation).

However, should the front door remain closed, either state could try the backdoor; both also have land-based casino legislation that, if online efforts fizzle out, could serve as a soft landing spot, providing online casino supporters with a mulligan.

In Indiana, State Sen. Andy Zay introduced SB 293, allowing Full House Resorts to move the Rising Star Casino to New Haven.
In Virginia, State Senate Majority Leader Scott Surovell introduced legislation that would make Fairfax County (the DC suburbs) a casino-eligible locale.

Legal and Regulatory Roundup: Lots of Bills

Mississippi has a new mobile betting bill: Mississippi will take another swing at legalizing online sports betting in 2025. Rep. Cedric Burnett has introduced HB 682. Efforts in 2024 made it to a conference committee (with an asterisk) before withering and dying on the vine. Still, they were upended as several land-based casino stakeholders cautioned that mobile sports betting was a gateway to online casinos.

North Dakota has a sports betting bill: HCR 3002 would put sports betting on the 2026 ballot in the state. A similar effort in 2023 was passed by the North Dakota House but failed in the Senate. HCR 3002 is vague in what it would allow (retail, online, or both) as it reads, “May authorize sports betting on professional and college sports to be conducted in the state and licensed and regulated by the state.” Based on comments by Rep. Scott Louser, who estimated “taxes on sports betting would bring in an estimated $25-$30 million,” it would authorize mobile betting.

Full story from the Bismarck Tribune

Nebraska gets another mobile betting bill: Nebraska is back with another mobile sports betting bill after a late effort in 2024 came up short. The new bill, LB 421, is sponsored by State Sen. Stan Clouse.

A quartet of bills in Connecticut: As reported by Daniel Wallach: “A package of sports betting bills were filed that would: (1) allow betting on CT college games; (2) allow retail operators to void bets w/ errors; (3) require 2-way markets; (4) establish a maximum hold %; and (5) allow consumer opt-outs.”

Iowa bill would ban proxy betting: Another interesting piece of legislation in Iowa that has Sports Betting Twitter very riled up (h/t Daniel Wallach): “A bill to ban proxy betting has been filed in the Iowa Legislature. HB 21 would treat proxy betting and sports betting account sharing as "illegal gambling" punishable as a Class D felony (for amounts over $500) with up to 5 years "confinement.”

Views: New Jersey Bill Would Legalize Sweepstakes

As noted in Thursday’s newsletter, New Jersey introduced a bill to legalize sweepstakes casinos and sportsbooks as iGaming operators.

This is an interesting way to address the very legally convoluted landscape. It would allow sweepstakes operators to join the regulated industry and provide regulators and law enforcement with a clear strategy to counter unlicensed operators. Unlicensed operators would be subject to a $1,000 per player per day fine and $10,000 for advertising transgressions.

To join the regulated industry, sweepstakes sites would need to obtain the requisite online gambling licenses, partner with a land-based casino, and submit to the same regulatory oversight as online casino and sportsbook operators, including KYC, AML, geolocation, responsible gambling, and independent audits.

Based on the wording, SBC Americas’ Jessica Welman wondered if the bill would capture social casino sites. My (I am not a lawyer) opinion is no, and the reason is the highlighted “and” from the bill and what follows (also highlighted):

I agree with Welman that it will be nearly impossible to write a sweepstakes bill that doesn’t capture other social casino operators or create a new loophole to exploit.

Still, it was welcome news to sweepstakes proponents. In a statement, the Social and Promotional Games Association (SPGA) said:

“The SPGA welcomes Assemblyman Calabrese’s bill. The SPGA and its members are advocates for clear regulations that enable transparent, innovative, and responsible social and promotional gaming experiences.
“The bill aligns with our core objective of reinforcing the well-established legality and legitimacy of social sweepstakes games, which millions of American adults enjoy.”

Sweepstakes skeptics had a different take, with Daniel Wallach tweeting:

"There’s virtually no likelihood that such a bill would bypass the objections of the regulated casino industry. Additionally, constitutional restrictions may make the legalisation of sweepstakes casinos a tough sell legally.
“In nearly case, the sweeps operators that would be pursuing licensure in New Jersey would be encumbered by their recent (and ongoing) track record of offering unregulated real money casino-style games in the state. That shouldn't raise any issues at all with the DGE.”

Steven Dimasi, the Senior Vice President of Global Government Affairs and Business Development at Light & Wonder, said on LinkedIn, “NJ Sweeps Bill: I’m pretty confident the sweeps bill won’t be a positive development for the pro sweeps lobby- await the bill language and intent folks.”

And let’s not forget that the National Council of Legislators from Gaming States (NCLGS) model online casino legislation recommends prohibiting sweepstakes.

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Around the Watercooler

Social media conversations, rumors, and gossip.

It appears that multiple folks on Sports Betting Twitter are suddenly having trouble depositing money into their accounts:

While this could be some type of limiting effort against sharp bettors, it could also indicate a financial institution(s) putting online gambling transactions on its prohibited list — banks and financial institutions can choose to allow or deny these transactions. As one commenter noted, “Deposit method being banned but action not being banned as a whole is awfully interesting.”

Stray Thoughts

It is critical to point out the existence of black and gray market online gambling operators. Still, the regulated industry is making a significant mistake when it CONTRASTS itself against the black market, as lawmakers and the public COMPARE the regulated sector with the black and gray markets. The result is that the industry detailing the evils of Black and Gray market operators and lawmakers and the general public hear, “Gambling is evil.”