Iowa's retail gambling industry will face increased cross-border competition from Nebraska, which approved casino rules in December

How Cross-Border Competition Could Spark The Online Gambling Discussion In Iowa

Iowa galloped across the finish line in August 2019 as one of the first states to launch legal online sportsbooks. Since then, the Hawkeye State slowed to a trot on any further gambling expansion.

However, Iowa may emerge in 2022 as a dark horse candidate to legalize online gambling, or at least advance the conversation about it. One factor that could drive that is cross-border competition for gambling dollars from its neighbors Illinois and Nebraska.

To the east, Illinois legislators walked got their own proposed online casino legislation as far as a committee, but the bill failed to advance further in 2021. This year may bring different news, as the Illinois General Assembly is again expected to take up bill discussions. However, at the moment, committees are meeting remotely and House and Senate sessions are completely stalled due to coronavirus concerns. The bill’s Senate sponsor, Sen. Cristina Castro, believes the effort’s chances to succeed are better for 2023 than this year.

New competition from Nebraska retail gambling

To the west, Nebraska’s racetracks are about to add retail casino gambling. On Dec. 17, the Nebraska State Racing and Gaming Commission approved rules that will govern casino operations.

Nebraska Public Media reports:

“Commission Chairman Dennis Lee indicated applications from existing racetracks would probably be considered first, but they can’t be filed until the rules are approved by the attorney general and the governor.”

Stuck in the middle, Iowa hasn’t yet approached the US online casino gambling starting gate. Its legislative session only began on Monday, however, so there’s still plenty of time.

Evan Johnson, a fiscal legislative analyst with the Legislative Services Agency (LSA), confirmed this for Online Poker Report yesterday:

“As of right now, I am not aware of any legislation introduced on that topic. This is only the start of Session, so that could change by the day.”

LSA is a nonpartisan legislative agency serving the Iowa Legislature.

Iowa seems to be readying to discuss online casinos

Iowa’s 3 million residents helped set a record for Hawkeye online sportsbook gross gaming revenue (GGR) in November, generating $19.7 million, according to OPR’s sister site Legal Sports Report.

So it’s no coincidence that operators who take bets at Iowa online sportsbooks, including DraftKings, PointsBet and Unibet, already secured market access for their hypothetical online casinos.

Even though operators are excited about their prospects in the state, they’ll be competing with lawmakers’ split attention, OPR sister publication Play Iowa reported.

The Oct. 26 article – which discusses PlayUp securing its own online casino market accessRuss Mitchell quoted Wes Ehrecke. He’s the president and CEO of the Iowa Gaming Association, which advocates for Iowa’s retail casinos. Those brick-and-mortar casinos may see reduced revenue if border states up the ante.

Ehrecke said legislators will likely be campaigning for reelection during summer and fall.

He told Play Iowa:

“The likelihood of this advancing in 2022 is less than 50% at this time.”

Ehrecke didn’t return OPR‘s request for an update yesterday. However, even a small chance is better than most US states have this year. For a large part of the country, online casinos aren’t even up for discussion yet.

Officials with the Iowa Racing and Gaming Commission, Nebraska Gov. Pete Ricketts and Nebraska Attorney General Doug Peterson also didn’t return OPR‘s requests for comment yesterday.

- Heather Fletcher is the lead writer with OnlinePokerReport. She's a career journalist, with bylines in The New York Times, Adweek and other publications. Reach her at [email protected]
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