Louisianan lawmakers have gathered to question whether the state should consider regulating online casino gaming.
The Louisiana Senate Judiciary B and Revenue and Fiscal Affairs Committees met this week to discuss the prevalence of igaming, potential regulation and the impact of the industry on jurisdictions across the country. Louisiana, which legalised online sports betting in 2022, is discussing igaming as America’s seven regulated markets drive strong revenue.
According to data provided to committee members, America’s 38 regulated sports betting states are projected to generate $13bn in annual gaming revenue. By comparison, the seven US igaming markets are estimated to generate $8bn in revenue in 2024.
Lobbyists of igaming in Louisiana note the prevalence of illicit gaming as a reason to bring regulated online casinos to the state. About $4.6bn has been wagered illegally with online casinos in Louisiana, according to a study by the American Gaming Association.
Regulation of igaming is also expected to provide added protection to state residents.
“There are well-documented connections between illegal online gaming taking place in the state and the money that comes from it for money laundering, for drug trafficking and for organised crime,” said Light & Wonder Global Head of Government Affairs and Legislative Counsel Howard Glaser during this week’s committee meeting. “These are some of the reasons that states consider regulating online casino gaming to protect consumers, combat transnational crime and capture tax revenue.”
The regulation of igaming in Louisiana is expected to also thwart the growth of unregulated sweepstakes operators that are operating in markets across America without licensing.
“These are not mom-and-pop shops like the old days of internet cafes,” adds Glaser. “These are big international companies with one spending $400m on marketing in the U.S.”
Despite the prospects of potential new revenue, igaming is drawing concerns from organizations, including entertainment operating company The Cordish Companies.
“Over $700m has been invested or committed to move casinos on shore bringing tremendous economic benefits to Louisiana,” said The Cordish Companies General Counsel Mark Stewart. “But we submit that bringing igaming to Louisiana would pull the rug out from under these projects and discourage additional land-based investment.”
The potential regulation of igaming in Louisiana is drawing cannibalization concerns. Representatives at the meeting from the Cordish Companies used data from three existing regulated iGaming markets to showcase a slight drop in gross revenue for retail casinos.
Opponents of igaming in Louisiana also cite gambling addiction as a reason to prevent the regulation of online casinos in the state. The quick accessibility of igaming through cell phones has also raised concerns for entities wanting to combat problem gambling.
Lawmakers in Louisiana will continue to discuss igaming and its potential impact on the state’s gaming market while taking into account the pros and cons of online casinos. Senate Resolution 149, passed in June, will allow lawmakers to continue the discussion.