Legalized Sports Betting Testimony Continues In Ohio, Grocers Want A Bite Of The Apple

The latest round of testimony in the Ohio Senate Select Committee on Gaming provided little in the way of surprises, outside of the discovery that Ohio grocers would like to be your friendly neighborhood sportsbook.

At least that was the testimony from Joe Ewig, speaking on behalf of the Ohio Grocers Association.

“We are not here today to advocate for opening a sportsbook in each grocery store, or having tables set up through our aisles, but we’re asking you to make us part of the sports gaming system,” Ewig said. “What we envision how this would function within a grocery store would be very much how you see a grocery store operating today, through the existing infrastructure, the systems we have in place through the lottery. We envision this as an enhanced opportunity through those existing machines that we operate.”

Ohio residents can purchase lottery tickets at grocery stores, and Ewig sees allowing them to parlay the Browns and Bengals as a natural fit for the grocery stores.

One issue, however, was brought up by state Sen. Niraj Antani, who pointed out that he would hate to see would-be sports bettors entering their local grocery store with “five million dollars in cash in a duffel bag and feeding it into the machine.”

Not much drama

Inclusive of that back-and-forth involving duffel bags full of cash and produce aisles, the 90 minutes of testimony offered little in the way of drama.

The big highlights were visits from Shawn Kasych, speaking on behalf of Score Media and Gaming, and Stacie Stern, on behalf of FanDuel, both of whom stuck to the industry’s main talking points: an 8-to-10% tax rate; three skins per casino (or racino); how legalization would “protect your constituents from illegal offshore betting,” as Stern phrased it; and robust competition.

“We believe New Jersey’s framework should serve as a model for the industry,” Kasych said. “The nine casinos in Atlantic City and three racetracks throughout the state are licensed for three skins. Indiana largely borrowed from New Jersey and allowed its casinos to have three skins, and West Virginia has done the same.”

Stern, speaking for FanDuel, advocated for no limits to be placed on collegiate sports wagering, saying, “We have no doubt betting on college sports is a significant percentage of the betting that is already happening in Ohio. If Ohio sports betting legislation artificially limits college betting in comparison to other sports betting, that doesn’t stop those college bets from happening. It just means they will stay in the illegal market where the state has zero visibility into who is betting and how much.”

Also speaking was a former member of the Ohio legislature, Dan Dodd, who is now working with the iDevelopment and Economic Association (iDEA), a group that bills itself as the “voice of the online gaming and betting industry in the U.S.” His group is also in favor of three skins per casino, and he offered a glimpse into where Ohio residents are currently placing their legal bets.

According to Dodd’s testimony, there were over 350,000 geolocation checks on Super Bowl Sunday near the borders of Pennsylvania, Indiana, West Virginia, and Michigan, four states where sports betting is fully legal.

“Based on this data, it is easy to conclude that the Ohio residents are regularly crossing the border into the four states to place an online bet,” Dodd said.

Fast start that sputtered

At the outset, it looked like Ohio, population nearly 12 million, ranking it seventh in the U.S. between Illinois and Georgia, was on the fast track to becoming a legalized sports betting state. Back in 2018, newly elected Republican Gov. Mike DeWine indicated he was open to sports betting, and with PASPA tossed, legislative leaders in the Buckeye State started the process toward legalization.

The first major stumbling block occurred when the Assembly and the Senate passed two very different bills. The Assembly bill would have put the Ohio Lottery Commission in charge of sports betting (both retail and online), whereas the Senate’s version had the Ohio Casino Control Commission in charge.

Other sticking points included colleges and universities in Ohio being against the bills in any form; the tax rates; and the number of skins existing casinos and racetracks could have.

Despite it all, industry watchers still thought Ohio was practically a shoo-in to get the the process completed in 2020. Then, of course, COVID-19 struck, stalling everything. Complicating matters was a fierce, and continuing, partisan battle over the virus, which FanDuel cited as a contributing factor to the delay in legislation.

In the end, 2020 came and went without the legislature passing either bill, which meant the whole process had to start anew in 2021, and with it, the weekly, hour-long Select Committee on Gaming hearings.

The committee chairman, Sen. Kirk Schuring, said it would not be hearing legislation but instead would make sure whoever has something to say about sports betting in Ohio is given the time to do so. He said the hearings will last “as long as they have to last, depending on how many witnesses we have.”

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