Brian Rockey said he was told to expect up to a 10% decline in lottery sales once casinos opened in Nebraska.
People are also reading…
But so far, the director of the Nebraska Lottery said that hasn’t materialized.
Sales for Powerball and Mega Millions tickets have continued to grow, something Rockey attributes to changes that have allowed jackpots to increase to record levels. Interest in other lottery games, such as Nebraska Pick 5 and scratch-off tickets, has remained steady, he said.
“We haven’t seen an impact at this point,” Rockey said.
There does, however, seem to have been an impact on charitable gaming.
The most recent Nebraska Department of Revenue report on games such as keno, pickle cards and bingo shows a marked decline in revenue.
For the quarter that ended June 30, total charitable gaming revenue was $92 million. That was down 10.6% from the January-March quarter and a 2% decline from the same quarter a year ago.
Rockey said it’s not uncommon for charitable gaming revenue to be lower in the second quarter of the year compared with the first, however, because people spend less time indoors.
He said it’s not clear to him at this point whether casinos are pulling money away from charitable gaming.
“We don’t have anything concrete to point to,” Rockey said.
There does appear to be anecdotal evidence, though.
Statewide, keno revenue in the second quarter of this year was $85.9 million, down from $87.4 million in the second quarter of 2022.
In Lincoln, where WarHorse Casino has been open for a year, the drop in keno revenue has been even more pronounced and appears to have started earlier.
The city saw about $24.5 million wagered on keno in the first half of this year, down from about $25.4 million in the second half of 2022 and $26.2 million in the same period in 2022.
And it’s not just happening in Lincoln.
Both Hickman and Waverly have seen declines in keno revenues, although revenue has remained steady in Denton and some other towns and villages.
Officials from Lincoln have said they are reserving at least part of the tax revenue they are receiving from WarHorse Casino to potentially replace keno funds.
Under state law, cities and counties that have a casino each get 12.5% of its tax revenue. That’s added up to an average of about $100,000 a month each for Lincoln and Lancaster County so far, or about $1.2 million each a year.
The city has earmarked $700,000 of its share of casino taxes to develop new and rehab existing affordable housing, and it is reserving the remaining $500,000 to replace keno revenue, which the city uses for parks, libraries and human services, if needed.
Lancaster County has designated its share of casino taxes primarily for federal-aid matching funds for road and bridge projects. Right now, the county is using keno money primarily for purchasing rights-of-way for the future east beltway.
Download the new Journal Star News Mobile App
How are states using tax income from legal sports betting?
How are states using tax income from legal sports betting?
Sports betting is legal and operational in 33 states as well as Washington, D.C. with three more to launch in 2023. How big is this enterprise? According to the American Gaming Association (AGA), commercial gaming revenue topped $60 billion during 2022, a 13.9% increase year-over-year. How are states using the tax revenues?
In most states, the majority of revenue heads to a “General Fund.” Virginia, for instance, allocates 2.5% of its sports betting revenue to programs to combat problem gambling, and the remaining 97.5% to its General Fund. Each state is free to allocate the revenue any way they see fit, which means that some states have gotten creative in the programs and initiatives they’ve funded with gambling revenue.
OLBG has researched five unique programs currently being funded with gambling revenue on the state level. Initiatives range from infrastructure and water preservation to education and mental health and substance abuse programs.
Colorado
The Rocky Mountain State is known for its natural beauty and Colorado voters were moved to protect it when they went to the polls in 2019. Voters approved sports betting in November of 2019 with a major selling point being that a portion of the tax revenue would be used to fund the Colorado Water Plan. State officials predicted that sports betting would provide an average of $14.9 million per year to the water plan for the first five years, with a cap of $27.2 million a year.
The Water Plan fund makes up the largest portion of the revenue from the 10% tax on sportsbooks’ net revenues. During the 2021-22 fiscal year, $12.4 million was received by the state, with $12.2 million of that approved for allocations. The Colorado Water Plan’s goal is to make the state more water resilient while boosting its resources by 2050.
Illinois
Sports betting in the state of Illinois has generated nearly $190 million in tax revenue from its launch March 2020 to October 2022. Gov. J.B. Pritzker estimated that gambling could bring in more than $100 million each year with a portion of those funds being allocated to its Capital Projects Fund, which seeks to improve roads, bridges, mass transit, schools, and universities.
Senate Bill 690, which legalized sports wagering, earmarked revenues for the Rebuild Illinois Capital plan. The bill estimated that sports betting could generate approximately $58 million to $102 million annually thanks to a 15% tax on sports wagering receipts and an additional 2% tax for wagers placed in Cook County.
Montana
In June of 2019, Big Sky Country gave sports gambling the green light when former Gov. Steve Bullock signed House Bill 725 into law. This Bill gave control of sports betting to the state lottery. The state utilizes the first $12.4 million in revenue to fund its General Fund, with the excess being directed to a STEM scholarship fund.
The Montana state legislature created the program in 2015, offering $1,000 scholarships to in-state high school graduates who major in science, technology, engineering, math or health care at a Montana college. In 2020, $500,000 was added to the scholarship fund according to the Montana Lottery’s Annual Report.
Tennessee
The Volunteer State has collected over $110 million in tax revenue since sports betting operators began taking wagers in November of 2020. Betting tax revenue from sports supports education in Tennessee by funding after-school programs and scholarships. Sports betting revenue is currently channeled into a lottery education fund that supports the HOPE and Tennessee Promise college scholarships.
The Tennessee Sports Wagering Act places stipulations on what the revenue could be used for in the state. The act states that 80% of the privilege tax revenue collected goes to the Lottery for Education Account, 15% goes to the general fund for infrastructure projects for local governments and 5% to the Tennessee Department of Mental Health and Substance Abuse for responsible gambling initiatives.
West Virginia
The Mountain State is looking out for its public employees. In 2018, the West Virginia state Senate passed an amendment that directed money from sports wagering to the Public Employees Insurance Agency’s stabilization fund (PEIA).
The amendment passed unanimously in 2018, but it’s clear that the tax revenue from sports betting hasn’t been enough to put PEIA on solid ground. Rising medical costs due to inflation and the increasing costs of prescription drugs, have pushed PEIA into a $92 million deficit in 2022.
This story was produced by OLBG and reviewed and distributed by Stacker Media.
Reach the writer at 402-473-2647 or [email protected].
On Twitter @LincolnBizBuzz.