Sports betting could generate $466 million annually in statewide economic impact by the fifth year, lawmakers hear
On Friday Indiana lawmakers mulled expert opinion from a range of witnesses at a hearing called to explore the possibilities of legalised intrastate sports betting proposed in House Bill 1325.
The witness list included a technology provider, the NBA, an anti-gambling group and small business owner Patrick Doerflein, who owns an app called “Burn and Bet.”
Indiana state lawmakers put forth several sports betting bills in 2018 and the Gaming Commission signed on with a market analysis firm (see previous InfoPowa reports).
One of the more interesting perspectives came from an analysis prepared for the Commission by consultants Eilers and Krejcik Gaming, who estimated that sports betting could generate $466 million annually in state-wide economic impact by the fifth year if it’s legalised by the Indiana General Assembly.
The analysis included anticipated revenue from both in-person and mobile betting and took into account both direct and indirect economic impact. It suggested that mobile wagers would account for 57 percent of sports betting, increasing to 68 percent by year six.
Retail and mobile systems could bring in $56.2 million in direct economic impact in the first year, the consultants predicted. Retail alone would generate $30.1 million. By the fifth year, mobile and retail could increase to $256 million annually in direct economic impact.
Importantly, by year five legalised sports betting could deliver almost 730 jobs in the state.
Lawmakers heard that if a 9.25 percent og GGR tax rate was applied, and added to licensing fees, the sate government could receive tax revenues of $23.5 million a year by the fifth year for a total of $89 million in the first five years.
“The major takeaway from this report is that the market here is not pre-determined,” Gaming Commission Deputy Director Jenny Reske told members of the Interim Study Committee on Public Policy.
“The size will be determined by public policy decisions that are made regarding many issues, including distribution channels, taxation, the macropolitical environment and the regulatory environment.”
The hearing was briefed on the efficacy of geo-location technology to ensure betting remains within state borders, and of advances in ID and age verification technology. There was some discussion around the provisions in HB 1325 for in-play betting, on which some lawmakers expressed concerns.
Lawmakers were told by a Gaming Commission official that Indiana sports betting fans could go to a casino, sign up for a mobile app and bet on sports while in the casino. Or they could use a betting window or a kiosk. Bettors would sign up in person, proving they are of betting age. Online betting could also be conducted if the user were tied into a credit account.
The Eilers and Krejcik Gaming study shows that football would be the most popular sport, attracting 40 percent of bettors, whilst NBA basketball could pull in 21 percent, and Major League Baseball accounts for 19 percent.