Casino Gambling in Nebraska Is Pulling Gamblers Out of Iowa

Article by : Erik Gibbs Dec 8, 2023

• 
• 

State records indicate that the implementation of authorized casino gambling in Nebraska seems to have influenced the earnings of two prominent gambling establishments in Council Bluffs, Iowa. Ameristar and Horseshoe, acknowledged as some of Iowa’s most financially successful casinos, have encountered a decrease in their revenue during the current year.

In its report on third-quarter revenue, the American Gaming Association shed light on this particular phenomenon, ascribed to the introduction of slot gaming in the eastern region of Nebraska towards the end of 2022.

The decline in earnings coincides with the apprehensions voiced by proponents of gambling in Nebraska. They maintained that the establishment of local casinos would be crucial to halt the drain of gambling funds to neighboring Iowa.

Lynne McNally, at the helm of Nebraska’s Horsemen’s Benevolent and Protective Association as their CEO, stressed that a noteworthy segment of the funds siphoned into the Council Bluffs casinos originates from residents of Nebraska. These contributions made by Nebraskans play a pivotal role in bolstering Iowa’s tax revenue.

Nebraska voters, having given their approval to Initiatives 429, 430, and 431 in November 2020, have effectively granted licensed horse tracks the authority to legally host casino-style gambling. An integral force behind the successful inclusion of these initiatives on the ballot was the horsemen’s group, which joined forces with Ho-Chunk Inc. to ensure their realization.

Brian Ohorilko, the executive overseeing the Iowa Racing and Gaming Commission, has publicly acknowledged that the opening of new establishments in Nebraska is expected to have a significant influence on the Council Bluffs market.

In the past fiscal year of 2023, there was a slight decrease of approximately 3% in the overall adjusted gaming revenue when considering Ameristar, Harrah’s, and Horseshoe combined, compared to the preceding year.

During the initial quadrimester of fiscal year 2024, the Council Bluffs casinos witnessed a continuous deterioration in their gaming income. Ameristar experienced a downfall of $2.1 million, Horseshoe faced a significant decline of $9.2 million, whereas Harrah’s managed to attain a meager boost of $400,000.

According to the Nebraska Racing and Gaming Commission, the gross gaming revenue of Nebraska’s casinos during the initial ten months of 2023 amounted to around $72.1 million, despite being in the nascent stages of operation.

Set to emerge at Horsemen’s Park in Omaha, the highly anticipated WarHorse Omaha is destined to become an utterly revolutionary destination. Combining casino thrills, exhilarating horse racing, and unparalleled entertainment, this majestic complex commands a staggering investment of $250 million.

The upcoming endeavor entails refurbishing Horsemen’s Park and constructing approximately 67,000 square feet of fresh infrastructures. Presently, the temporary locale provides simulcast horse racing and sports betting services. However, the complete establishment of the casino is anticipated to occur by the upcoming autumn season.

Nebraska’s casinos are expected to bring about a substantial impact, as suggested by a study conducted in 2021 by the Spectrum Gaming Group and obtained by the Iowa Racing and Gaming Commission. However, the true extent of this impact will only become evident after several years have passed.

According to the study, once the new casinos in Nebraska are fully operational, Iowa’s Council Bluffs casinos could potentially suffer a loss of $183.9 million in adjusted gross receipts. This projected outcome has the capacity to approximately halve the gross receipts of Iowa casinos.

Gamblers at WarHorse Lincoln have pointed out the prime importance of convenience, with their gratitude for the fact that their gambling expenses contribute to the flourishing economy of Nebraska.

Nevertheless, their choices are heavily influenced by the overall encounter, which encompasses an adequate probability of prevailing and additional benefits such as incentives, complimentary offers, and giveaways.

Certain individuals emphasized the prospective alleviation of taxes while opining that the forthcoming Nebraska gambling establishments have the capacity to present novel gaming prospects and encounters.

Although the impact of taxes is taken into account by a few, the majority places greater importance on convenience, expenses, winnings, and the overall sensation of gambling.

Brian Ohorilko, the Iowa gaming official, stressed the imperative for Iowa casinos to remain competitive through strategic investment in their establishments, delivering unparalleled customer service, and fulfilling their responsibilities as responsible license holders.

Operators in the evolving market anticipate ongoing and considerable investments in establishments like the Council Bluffs-based Harrah’s facility, as they endeavor to both rival and flourish in the industry.