Indiana Governor Says No To Online Horse Racing, Allows Approval Of Two Other Gaming Bills

June 3, 2015
Indiana Governor Says No To Online Horse Racing, Allows Approval Of Two Other Gaming Bills

During the current legislative session the Indiana legislature passed three bills designed to assist the state’s struggling gaming industry. Two of these bills are now law in Indiana.

Governor Mike Pence, who has firmly stated his opposition to gaming expansion, particularly online gambling, allowed two of the bills to pass into law while vetoing the third. A fourth bill that clarified charitable gaming laws in the state was signed by the governor.

Pence did not sign either bill into law. Instead the savvy politician allowed both to be passed by executive inaction rather than be seen as expanding gambling in the state.

He did issue a statement explaining why he allowed the bills to become law in Indiana:

“Most Hoosiers know that I oppose an expansion of gaming in Indiana, but I recognize that gaming has become an important part of the economy of many communities in our state and is an important part of our state budget.

From early in the legislative process, I made it clear that I would not stand in the way of reforms that would allow these businesses to remain competitive with surrounding states so long as it did not constitute an expansion of gaming in Indiana. HEA 1540 and SEA 252 meet this standard and, as such, I will permit them to become law without signature.” 

HEA 1540

The most impactful of the bills is HEA 1540, which accomplishes two things.

First, it allows Indiana’s riverboat casinos to move their casinos onto land, a change that will allow these casinos to dramatically increase their footprints and amenities offered.

Mississippi passed a similar bill in the aftermath of Hurricane Katrina that is widely credited with speeding up the post-Katrina recovery.

Mississippi is one of gaming’s great success stories, with tribal casinos authorized under the 1988 Indian Gaming Regulatory Act and the 1990 Mississippi Gaming Control Act which allowed riverboat casinos to open.

The riverboat casino industry was decimated by Hurricane Katrina and few operators were willing to rebuild their riverboat casinos while simultaneously competing with full-fledged tribal casinos inland.

In 2005, the Mississippi legislature decided to allow riverboat casinos to build on land within 800 feet of the river. Many feel it saved the state’s gaming industry.

Secondly, HEA 1540 allows Indiana’s governor to negotiate a gaming compact with the state’s tribes. As part of the legislation, in order for a tribal gaming compact to be completed it would have to be approved by the legislature.

It will be interesting to see what kind of pushback the state’s current casinos give to potential serious competitors like the Pokagon Indians.

SEA 252

The second bill Pence’s inaction allowed to become law was SEA 252.

SEA 252’s main purpose was to give the Indiana Horse Racing Commission the capability to use breed development funds to promote the horse racing industry in the state.

The bill also redefined daily stipends for horse racing commissioners.

HEA 1270

The bill Pence considered a bridge too far, HEA 1270, would have gently nudged Indiana into legal online gambling. It would have had a much larger impact on the state’s horse racing industry than SEA 252.

Even though HEA 1540 has the potential to greatly expand gaming’s footprint in Indiana, Pence allowed it to pass into law, while at the same time vetoing a bill that would have permitted Indiana residents to place horse racing wagers online – a measure that would have had much less of an impact on Indiana’s gaming industry.

Currently horse racing wagers can only be made by traveling to one of the state’s OTB parlors or pari-mutuel tracks. Had HEA 1270 passed, these tracks would have been able to expand their businesses to include online horse racing wagers, something that was made legal under the Interstate Horse Racing Act of 1978 and is currently available in over half of U.S. states.

“This legislation is contrary to my long-time position against online gaming,” Pence said in regards to his veto of HEA 1270 in a press release. “Advance Deposit Wagering, not currently permitted in Indiana, would also violate my position on expanding gaming here in Indiana.”

Jim Brown, the President and COO of Centaur Gaming and General Manager of Indiana Grand Racing and Casino sees it very differently.

“We didn’t feel replacing an electronic dealer with a live dealer was expansion, but others did,” Brown said of the Governor’s veto. Brown continued, “We are disappointed in the short term for our host communities. They would have benefited from the jobs created.”

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