Worries from casinos, small businesses slow sports-betting bill

·5 min read

Jun. 21—COLUMBUS — As debate over legal sports betting in Ohio shifts to the House, fights continue over who will ultimately be able to come to the table for licenses, for bricks-and-mortar and mobile app operations.

Senate Bill 176 passed the Senate last week by a vote of 30-2, but it could be a major hurdle for it to clear the House before lawmakers recess for the summer by the end of the month.

NEW GAMING IN SENATE BILL 176

Type A (mobile): 25 three-year licenses for online and mobile app sports-betting operations. Fee: $1 million for first year and $500,000 for second and third. Regulated by the Ohio Casino Control Commission.

Type B (bricks-and mortar): 33 three-year sports-betting licenses distributed according to county population. Fee $100,000., Regulated by casino commission.

Type C (kiosk): 20 three-year licenses for vendors to supply bars and restaurants with up to two self-service sports-betting kiosks. Fee: $100,000 for vendors and $6,000 for bars and restaurants. Regulated by the Ohio Lottery Commission.

E-bingo: Electronic instant bingo and other charitable gaming at fraternal and veteran's organizations. Regulated by state attorney general.

The bill would create three types of licenses, including one for physical bookmaking structures. These would essentially be sports bars with big screen TVs where bets can be personally made and games watched over beer and a meal.

These thirty-three licenses would be limited to 27 counties with populations above 100,000, and major professional sports teams would be first in line for licenses.

That means that if the Cleveland Browns, Indians, and Cavaliers opt for Type B bricks-and-mortar licenses instead of Type A mobile apps, they would eat up Cuyahoga County's three licenses, shutting out the downtown JACK Casino and Thistledown racetrack slots parlor.

Cuyahoga and Franklin counties are the only two counties with populations above 1 million qualifying for three licenses.

If the Cincinnati Bengals and Reds do the same, that would consume both of Hamilton County's licenses, leaving the Hard Rock Casino and Belterra Park racino on the outside looking in. Hamilton, Montgomery, and Summit counties would be the only counties with populations between 500,000 and 1 million that would get two licenses.

"Our group is critical of it. Now the casinos are critical of the legislation," Greg Beswick said, spokesman for the Fair Gaming Coalition, a coalition of bars, restaurants, bowling alleys, convenience stores, and other businesses already offering lottery products.

"You have a lot of interested parties who — except for the professional sports teams — were not happy with how it came out of the Senate," he said.

The disputes appear to be slowing down a measure that supporters had hoped to get to Gov. Mike DeWine's desk before the General Assembly recesses for the summer before the end of June.

Sen. Niraj Antani (R., Miamisburg), who sponsored the bill with Sen. Nathan Manning (R., North Ridgeville) said the Type B licensing issue for Ohio's biggest counties is one of the issues that will have to be worked out with the House.

But he characterized the differences as "more minutia" than major disputes.

"The market is going to determine how many (licenses) is too many," Mr. Antani said. "We have to be mindful of ensuring that these are legitimate operators only, but we're at a good number right now. The cap issue for big counties will be worked out successfully."

Lucas, Wood, and Allen counties would be the only northwest Ohio counties among the 23 eligible for a single bricks-and-mortar establishment. While Penn National Gaming's Hollywood Casino in Toledo would be seen as a likely contender in Lucas County, Mr. Antani stressed that other businesses can compete for the county's single bricks-and-mortar license.

The backers of the bill argue that the measure takes a "free market" approach and does not guarantee monopolies to Ohio's four voter-approved casinos and seven racetrack parlors. Lawmakers have not forgotten that the casinos did carve out a monopoly for themselves — right down to parcel numbers — in the constitutional amendment that voters approved in 2009.

But bowling alleys, grocers, and other businesses that already sell lottery products argue that casinos, racinos, and professional sports teams are still the major beneficiaries of Senate Bill 176

They argue that a $6,000 annual license for up to two self-service kiosks in bars and restaurants with licensees could still be beyond the reach of many small operators. The machines could take credit card bets of up to $200.

"Sixty-one counties will not be able to provide this potential economic engine," Mr. Beswick said. "It's not so much about sports betting. It's the residual spending at the moms and pops that are working hard to stay open. It's the beverage and food after you place a bet on a game.

"Sixty-one counties have a lot of representatives who would like to see their areas participate," he said

The Type A, or mobile licensees, could contract with up to two app services or "skins." The state will impose a 10 percent tax on net revenue from the gaming with 98 percent of the proceeds going to K-12 education and 2 percent to gambling addiction programs.

First Published June 21, 2021, 4:50pm

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