House Study Commission Recommends Ohio iGaming, iLottery

House Study Commission Recommends Ohio iGaming, iLottery

Three Ohio House members say they are “encouraged with the current state and direction of the gaming industry” in the Buckeye State. However, they foresee more potential for growth — if the state adds Ohio iGaming and iLottery.

GOP Reps. Jay Edwards, Jeff LaRe, and Cindy Abrams shared their findings in the July 12, 2024, “Report on the Future of Gaming in Ohio.”

“There has been a lot of discussion around legalizing forms of iGaming and iLottery that would allow users the same freedom that online sports gaming does now,” they wrote. “However, there has been pushback from the brick-and-mortar gaming facilities and lottery retailers who have been worried about the effect that would have on their annual revenue with decreased in-person participation.”

Members of the Study Commission on the Future of Gaming in Ohio continued:

“While we understand their hesitation to expand due to an uncertain impact, we believe that iLottery and iGaming could be a net benefit to the state of Ohio. Looking at other states who have implemented either or both iLottery and iGaming, we see significant increases to tax revenues generated with greater participation but also that in-person sales continued to increase.”

Other States Cited in Ohio iGaming, iLottery Study

Three factors contributed to the commission’s assessment of online lottery expansion:

  • Ohioans who place online bets become more comfortable and knowledgeable when they visit a physical location.
  • Pennsylvania launched iLottery in 2018. The state saw almost a 20% sales increase at traditional lottery locations.
  • Kentucky launched iLottery in 2018. In-store lottery sales in the Bluegrass State grew by 56%.

The commission’s report cited online casino gaming growth in nearby markets as well:

Connecticut’s iGaming market increased by 44.7% in 2023. Michigan also legalized online casino games in 2021. With $3.6 billion in revenue since the launch, Michigan now has the largest iGaming market in the country.

“These tax revenue benefits to the state — and funding that could be provided to our K-12 education system — cannot be overlooked,” the commission members reported.

Study Calls For Reduced Sports Betting Revenue Tax

The study’s authors also criticized Ohio HB 33, which doubled the Ohio sports betting tax rate from 10% to 20%. They used the term “premature” to describe the legislation. The sports betting industry was just six months old at the time.

“The General Assembly implemented a substantial tax increase on sports gaming companies who had already invested millions of dollars into kickstarting the industry in Ohio. This hampered the growth that was occurring and made other companies think twice about coming to Ohio to invest,” the commission members wrote.

“At a minimum, the companies who look to make future investments in Ohio should know what they are buying into,” they added.

Should Ohio College Prop Bets Return?

The report from Edwards, LaRa, and Abrams encouraged the Ohio Casino Control Commission to walk back a ban on college prop bets in Ohio.

The OCCC added the ban at the NCAA’s request, but “we believe it was not needed,” the report said.

In part, the study’s authors note that college athletes now earn money through NIL.

“Players are now being paid to play (and perform) in certain sports,” they wrote. “That is no different than any other professional sport.”

Ohio sports betting debuted on Jan. 1, 2023, and generated $143.3 million in the first year. About 98% of the funds went toward K-12 education. Meanwhile, the Ohio State Lottery created $1.46 billion for the Lottery Profits Education Fund.

“We are glad that these numbers have grown,” commission members wrote. “[We] see a future where further expansion in the gaming/lottery industry will see these numbers grow even more.

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About the Author
Russ Mitchell

Russ Mitchell

Lead Writer
Russ Mitchell joined Gaming Today as a lead writer in February 2023 after joining Catena Media in 2021 as a managing editor for the PlayIA and PlayVA brands. He covers sports betting industry, market developments, the college sports betting industry, and the four major North American pro sports leagues. He brings 25+ years of journalism experience to Gaming Today. He is a five-time winner of the Iowa’s prestigious Harrison “Skip” Weber Investigative Reporting award, a two-time National Newspaper Association award winner and a 50-time Iowa Newspaper Association award winner.

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