Five days after his counterpart in Montana did the same, Governor Eric Holcomb of Indiana signed legislation to regulate the sports betting industry.
Holcomb officially made House Bill 1015 – which allows adults in Indiana to wager with both brick and mortar and online/mobile sportsbooks – the law of the land on May 8th. Governor Steve Bullock of Montana signed the Big Sky State’s sports betting bill on May 3rd.
Indiana became the second state to legalize sportsbooks in 2019, setting the stage for another year of progress on the regulatory front following last May’s decision by the U.S. Supreme Court to repeal a federal ban (outside of Nevada).
Since the Professional and Amateur Sports Protection Act (PASPA) of 1992 was struck down as unconstitutionally restricting states’ rights, legal sportsbooks have been launched in Delaware, New Jersey, Mississippi, West Virginia, New Mexico, Pennsylvania, and Rhode Island.
Hoosier State Hopes to Follow New Jersey’s Lead
After going live last June with land-based and online/mobile sports betting operated by both in-state and third-party competitors, New Jersey has emerged as a template for other states to follow. Thus far, sportsbooks in the Garden State have accepted more than $2.6 billion in wagering handle while collecting over $178 million in revenue.
And with a bifurcated rate of 8.5 percent on gross gaming revenue from retail sportsbooks, and 13 percent for online/mobile outlets, New Jersey has collected over $20 million in tax revenue alone.
Indiana lawmakers are clearly looking to emulate New Jersey’s success by closely mimicking that structure.
HB-1015 directs the Indiana Gaming Commission (IGC) to commence the licensing process on July 1st. Prospective applicants – which include Indiana’s 14 casinos and two major horseracing tracks – must pay $100,000 to apply for a sportsbook operator’s license. Approved local operators can also contract with third-party bookmakers and software platforms to provide backend services.
In New Jersey, the Division of Gaming Enforcement (NJDGE) licenses casinos and racetracks, which can partner with third-party providers, for a fee of $100,000.
And Indiana’s tax rate of 9.5 percent on all forms of wagering finds a perfect middle ground between New Jersey’s dual rate.
State Leaders Already Eyeing Sportsbook Revenue
In a statement, Holcomb ushered in Indiana’s new era of regulated sports betting by pointing to the potential revenue stream, which has been estimated at $466 million over the first five years:
“Gaming is a highly regulated industry that once had little competition, but now does from surrounding states and new technology.
By modernizing our laws, this legislation will spur positive economic growth for our state and for an industry that employs over 11,000 Hoosiers. Additionally, it will bring in new revenue and create hundreds of new jobs – both permanent and in construction.
I will direct the Indiana Gaming Commission to monitor for potential effects of this bill so that we can make necessary changes in future legislative sessions.”
Speaking to local media shortly after the bill was signed, Lieutenant Governor Suzanne Crouch pointed to the potential benefits of becoming the Midwest’s first state to offer legal sportsbooks:
“Everything was done to make gaming in Indiana more competitive with other states and be able to face that competition.”