Churchill Downs Inc. entered the Indiana gambling industry in April with the opening of its Terre Haute Casino Resort.
Unlike some of the other land-based operators in the state, Churchill doesn’t have its own sportsbook or online casino brand.
Because of that, the Kentucky-based company is likely to provide another voice against efforts to legalize Indiana online casinos.
Indiana lawmakers chose not to consider iGaming this year
This year, legislation to bring online casinos to Indiana was stalled before the legislative session even began. Indiana House Speaker Todd Huston and Senate President Pro Tempore Rodric Bray made an agreement not to consider iGaming expansion in the 2024 session in the wake of a corruption scandal involving a state lawmaker and a casino company.
That scuttled Rep. Ethan Manning’s planned 2024 gaming expansion proposal, which would have included online casino legalization.
Most industry experts agree that iGaming expansion in the US is inevitable. Indiana online casino legislation will almost certainly be proposed next session. Whether it passes or not depends on how lawmakers respond to arguments for and against expansion, as well as the perceived need for the tax revenue that could be generated.
Churchill Downs voiced iGaming opposition in Maryland
In February, Maryland’s House and Senate held hearings on iGaming. The hearings offer some insight into what could be expected when Indiana restarts legislative efforts to legalize online casinos.
A Churchill Downs Inc. (CDI) property spokesperson was one of just two brick-and-mortar casinos to testify against that state’s bill to allow online casinos. The other was The Cordish Companies, which doesn’t own a casino in Indiana. The opposition was based on the argument that online casinos would cannibalize land-based casino revenue and lead to job loss at those casinos.
That has been a leading argument across the country against iGaming expansion. It’s sure to arise when Indiana lawmakers consider online casinos.
CDI had previously developed online sportsbook and online casino products under the name TwinSpires. But it shuttered both in 2022, citing limited growth potential and revenue return.
Bobbi Jones, general manager of Churchill Downs’ Ocean Downs Casino and Racetrack in Maryland, testified that CDI’s Pennsylvania casino, Presque Isle Downs, lost 45% of its workforce and saw revenue decline 15% as a result of online casino legalization.
That kind of argument will likely be brought to the table by CDI as Indiana commences iGaming expansion efforts.
Most casinos in Maryland support online casinos
At the hearing, those who supported legalization cited a study published by iDEA Growth that found that brick-and-mortar casino revenue actually increases in states with online casinos.
Four of the six casinos in Maryland supported legalization and sent representatives to testify in favor. The general manager of Horseshoe Casino Baltimore testified that he believed online casinos would increase employment. It is operated by Caesars Entertainment, which runs Horseshoe Hammond and Horseshoe Indianapolis in Indiana.
Caesars’ online casino product, Caesars Palace Online Casino, is available in four states, so the company would likely also lobby for iGaming expansion in Indiana.
A Boyd Gaming rep also spoke in favor of online casinos at the hearings. Boyd operates Belterra Casino Resort & Spa and Blue Chip Casino Hotel Spa in Indiana. Boyd also has an iGaming product, Stardust Online Casino, in two states, so it would almost certainly be in support of online gaming expansion in the Hoosier State.
Most Indiana casinos have iGaming connections
Indiana is top-heavy with casinos that have parent companies that offer online casino products in other markets. And the majority already have online sportsbook partnerships with companies that also have online casinos. So, as in Maryland, pro-iGaming industry support for legalization would outnumber the brick-and-mortar operators that oppose it.
Other Indiana land-based casinos operated by companies with iGaming products include Ameristar Casino Hotel East Chicago and Hollywood Casino Lawrenceburg (operated by Penn Entertainment) and Hard Rock Casino Northern Indiana.
Bally’s Corporation operates Bally’s Evansville Casino. The company’s iGaming product, Bally Casino, is live in Pennsylvania, New Jersey and Rhode Island. Bally’s recently launched its free-play Bally Play social casino in Indiana. It gives the company an iGaming presence in the state ahead of any potential legalization.
CDI opposition will likely have minimal effect in Indiana
CDI’s opposition alone wouldn’t be enough to sway Indiana lawmakers away from online casino legalization. In Maryland, the company was just a single voice in a chorus of parties objecting to the expansion. Others who opposed the bill included labor unions concerned about losing casino jobs and those worried about an increase in problem gambling.
Ultimately, Maryland’s online casino bill passed in the House but failed to move forward in the Senate. But its failure had more to do with lawmakers deciding there wasn’t an urgent need for the tax revenue boost iGaming would bring.
Indiana lawmakers will hear all of the same arguments against online casinos when legislation is next proposed. Ultimately, what might be the key factor in deciding iGaming’s fate in the Hoosier State is how much revenue it could generate.
CDI will probably join the chorus in opposition to online casino legalization in Indiana. But its presence in the discussion won’t be enough to significantly sway the argument one way or another.
