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In what has been one of the busiest years for gambling legislation in Ohio, a new bill to legalize online gambling in the state has been introduced, the second this month.
Reps. Brian Stewart (R-Ashville) and Marilyn John (R-Richland) introduced House Bill 298 to the Ohio General Assembly yesterday (May 20) and if passed, it would authorize the Ohio Casino Control Commission (CAC) to regulate online casino games like slots and interactive table games the same the sports betting industry is being regulated.
We already have online gambling in other forms,” John said about the sports betting industry. “[iGaming] is a job creator, job creation in technological development.”
This bill follows House Bill 96 that was introduced by Bill Stewart earlier this month. HB96 is also looking to expand the state’s gambling framework to include both online casino and online poker.
Heavy Restrictions Expected
The proposed legislation includes several measures to address concerns about excessive gambling. For one, participation is limited to individuals aged 21 and over who are physically located in Ohio.
It also bans the use of credit cards for placing bets and does not permit promotional gaming credits specifically for online play. On the other hand, operators can still provide promotional credits for in-person gaming at casinos or racetracks, as well as for amenities like hotels and shows.
Each operator will be restricted to just one online platform. If a parent company has multiple qualifying entities, only one can hold the operator’s license. The initial fee for this license is set at $50 million, with a renewal fee of $10 million. Operators may collaborate with management companies, which will also require licensing.
The legislation mandates that all gambling servers be based in Ohio, with the Ohio Casino Control Commission (CAC) responsible for testing and approving all gaming equipment through independent labs. Additionally, anyone involved in internet gambling operations must secure occupational licenses, with provisional licenses available for the first six months.
The bill aims to establish a launch date for online gambling by March 31 of next year. Tax implications are also outlined, with a 28% tax on internet gambling receipts. After deducting administrative costs, 99% of the revenue will be directed to the state’s General Revenue Fund, while 1% will support the Problem Gambling Fund.
Moreover, revenues exceeding taxable amounts will be exempt from the Commercial Activity Tax, following the same rules as casino and sports betting revenues.
No Room for Sweepstakes
The new legislation places a strong emphasis on banning online sweepstakes games, allowing them only if they receive explicit authorization. It broadens the definition of gambling to include online sweepstakes that utilize a dual-currency system or simulate traditional gambling games, making those not expressly permitted by law illegal.
These types of games, often found in unregulated markets, will now be categorized as criminal under the updated statute. However, implementing this legislation involves navigating some constitutional complexities. According to Article XV, Section 6 of the Ohio Constitution, lotteries and gambling are generally prohibited except for state-sanctioned lottery, charitable bingo, and casino gaming at designated locations.
While the Constitution restricts casino gaming to specific sites, the bill argues that internet gambling could be authorized through separate statutory measures. Legal precedents indicate that the General Assembly may have some flexibility to define and regulate new gambling forms that aren’t explicitly banned, though the Ohio Supreme Court has yet to provide a clear ruling on this issue.
Additionally, the bill includes licensing and operational restrictions aimed at integrating online gambling into the state’s current gaming framework. The proposed licensing fees and tax rates are designed not only to generate significant revenue for the state but also to support initiatives.
But while the bill offers lots of promises, it still has a long way to go. The first hurdle it needs to clear is being added to the legislative calendar, which is yet to happen.
Source: Next.io
