PITTSBURGH – As state lawmakers from across the country discussed potential model online casino legislation last week, regulators from three states worked to dispel brick-and-mortar cannibalization beliefs.
At the National Council of Legislators from Gaming States summer conference, members spent an afternoon discussing model online casino language. During one of the panels, three regulators discussed their experiences in states with online gambling.
That included a strong rebuke to legislator concerns of brick-and-mortar casino cannibalization by David Rebuck, former director of the New Jersey Division of Gaming Enforcement. Online gambling has been legal in New Jersey since December 2013.
“When you hear the fear-mongering of cannibalization and loss of jobs from internet gaming, I have 12 years of data in New Jersey showing that isn’t true,” a Rebuck quote from PlayUSA displayed during the panel read. “Online gaming doesn’t cannibalize brick-and-mortar casinos and it doesn’t hurt casino jobs.”
Casino cannibalization discussion
Along with Rebuck, two other regulators worked to dispel a narrative of cannibalization:
- Lee Copello, iGaming compliance manager at the Pennsylvania Gaming Control Board
- Helene Keeley, director at the Delaware Lottery
Copello emphasized online gambling and brick-and-mortar casinos have two separate customer bases. Pennsylvania iCasinos launched in 2019.
“Your younger generation is more engaged with the online side. They also visit your land-based casinos when the entertainment options are available there,” he said. “So, I think if you continue to differentiate those two, I think it’s two different experiences you’re getting. And just off the data we’ve had for the past five years, With iGaming running current with land-based operations, we have not seen that cannibalization.”
No model online casino language yet
Despite multiple panels discussing online gambling, NCLGS leadership did not unveil model legislation yet. They said they hope a draft will be ready for a 30-day public comment period in August, with a final draft ready for the organization’s winter meeting in December.
A main component, however, will be a tax rate between 15% and 25%. Among the aspects they want to iron out:
- Addressing cannibalization and responsible gambling concerns
- Advertising guidelines
- Age limits
- Licensing uniformity
Online casino slower to catch on
While nearly 40 states have legalized sports betting since 2018, the adoption of iCasinos is trailing slowly. Seven states have legalized online casino:
- Connecticut
- Delaware
- Michigan
- New Jersey
- Pennsylvania
- Rhode Island
- West Virginia
Copello said while sports betting is an amenity for casinos, online casino is an additional revenue source that has an expectation to bring in significantly more revenue. Along with the cannibalization fears, many opponents worry about a potential surge in problem gambling with online casinos.
