Revenue from gambling falls short in Ohio's budget deficit, suggests an opinion piece.

Let's talk Ohio iGaming expansion, shall we?

The Making of a Myth

You might think the Ohio Lottery funds our schools, but think again. That's just talk-show host baloney. This misconception underscores why the current General Assembly's gambling expansion proposal, aiming to replace large chunks of Ohio's income and property taxes, is nothing more than hot air.

In 1987, Ohio voters nodded to a constitutional amendment, affirming lottery profits would support K-12 schools—a perk missing from the original 1973 amendment. Now, these profits account for approximately 11.5 cents out of every school-related dollar the state spends.

So, for the upcoming academic year: Ohio Lottery profits earmarked for Ohio K-12 schools amount to a whopping $1.5 billion.

On the flip side, Ohio's expected state sales tax collections for this fiscal year: Stand tall at $13.9 billion.

iGaming Bills in Focus

Ohio is weighing two bills that could shake up the gaming world. House Bill 298 and Senate Bill 197 are waiting in the wings.

House Bill 298 is Rep. Brian Stewart's baby, aiming to legalize online casino gambling for existing Ohio casinos and racinos. It lays down a launch date of no later than March 31, 2026, with a ban on sweepstakes gaming. The bill proposes a 28% tax rate on gaming revenues, with 99% heading to the state's general fund and 1% to problem gambling resources[1][4].
Senate Bill 197, introduced on May 13, 2025, by Senator Nathan Manning, also seeks to legalize internet gambling and consolidate gaming regulations. As of now, it's treading water in the Senate Select Committee on Gaming, waiting for a hearing[3][5].

The Implications

If these bills make it, Ohio's state coffers might see some significant boosts. A 28% tax rate on gaming revenues, as suggested in House Bill 298, could net between $400 million to $800 million yearly, with the majority going into the state's coffers[1][4]. This windfall could support an array of state programs and services, without hiking up property taxes. However, constitutional concerns about expanded gambling could slow down the legislative process[2].

Constitutional Conundrums

There's a country-club-worthy discussion about whether expanding iGaming in Ohio is constitutional, which could stall these bills' progress. The state constitution has provisions that might restrict or limit gambling expansion, generating potential legal challenges if these bills pass[2].

The current General Assembly's proposal to replace large segments of Ohio's income and property taxes with gambling expansion, as seen in House Bill 298 and Senate Bill 197, seems to echo the inflated promises often heard in the realm of casino-and-gambling politics.
If House Bill 298 is passed, the potential annual revenue of up to $800 million from a 28% tax rate on gaming revenues could significantly impact Ohio's finance, potentially reducing the need for general-news worthy property tax hikes. However, constitutional debates over the expansion of iGaming could pose obstacles to the bills' progression.

Revenue from gambling falls short in Ohio's budget deficit, suggests an opinion piece.