New Ohio Casino Bill Proposes Ban On Sweepstakes

A recent legislative development in Ohio aims to reshape the state’s gambling landscape, proposing both the legalization of online casinos and a ban on sweepstakes casinos. Introduced on May 20, House Bill 298, sponsored by Rep. Brian Stewart, sets a target date for the legalization of online casinos by March 31, 2026. The Ohio Casino Control Commission (OCCC) will oversee regulation, similar to its role in managing sports betting within the state.

Regulatory Framework and Licensing

The proposed bill complements an earlier Senate measure, signaling bipartisan interest in expanding Ohio’s gambling offerings. Both pieces of legislation aim to issue licenses to the state’s 11 casinos and racinos, establishing a set license fee of $50 million. Furthermore, these initiatives designate 99% of the generated tax revenue to the Ohio general fund, with a modest 1% earmarked for initiatives addressing problem gambling.

Key Differences Between the Bills

While both bills strive to establish a framework for online casinos, they present distinct differences:

1. Tax Rate Variations:

   • House Bill 298 proposes a 28% tax rate, which, according to Stewart, is projected to generate between $400 million and $800 million annually.
   • In contrast, Senate Bill 197, introduced by Sen. Nathan Manning, suggests a notably higher tax rate ranging from 36% to 40%.

2. Renewal Fees:

   • The renewal fee for licenses under HB 298 is set at $10 million every five years, whereas Manning’s proposal suggests a $5 million renewal fee.
3. Eligibility for Licenses:
   • HB 298 restricts licenses to Ohio’s existing casinos and racinos,
   • SB 197 opens the door for external operators, such as Caesars or PENN, but enforces a steeper tax rate of 40% coupled with the elevated renewal fee.

The Ban on Sweepstakes Casinos

Another significant aspect of Stewart’s proposal is the explicit prohibition on sweepstakes casinos. Unlike SB 197, HB 298 outlines what constitutes an “online sweepstakes game,” identifying it by its digital accessibility and functionality—employing a dual-currency system to engage players in various gambling activities, including bingo and lottery games.

The proliferation of online sweepstakes and social casinos, which have attracted growing interest in states like Ohio, is noteworthy. Recently, these platforms generated an estimated $3.7 billion in revenue from residents, reflecting a substantial market demand.

Ohio’s Motive to Expand the Gambling Market

The move to introduce legislation for online casinos signifies Ohio’s intent to broaden its legal gambling options. Gov. Mike DeWine’s interest in enhancing state revenue from the gambling sector is evident, particularly through his suggestion to double the tax rate on sports betting, though this proposal has been excluded from Stewart’s budget.

However, the multiple legislative proposals, albeit slightly varied, present potential complications. Notably, in light of the tax hike being dismissed, there are plans to impose a 2% tax on the betting handle.

The latest proposal is now undergoing scrutiny by the House Finance Committee. All legislative proposals are required to secure passage by the conclusion of the current session, which is scheduled to end at year’s end.

In conclusion, as Ohio navigates these legislative waterways, the implications of these measures could significantly reshape its gambling environment, reflecting both emerging trends and consumer preferences in the industry.

Author’s Bio:
Adam Roarty is a seasoned writer with extensive experience in the gambling industry. Over the past five years, he has contributed as a content writer and editor for notable platforms such as Oddschecker, CoinTelegraph, and Gambling Industry News, lending his expertise to the realms of sports betting and online gambling.