Penn, Ohio Casinos Wary Online Lottery Could Overstep With Instant Games

Posted on October 7, 2020 - Last Updated on October 13, 2020

Ohio’s predominant casino operator welcomes online lottery language in the sports betting legislation with a caveat.

Last week, PlayOhio reported on a movement in the Senate to amend H 194 to include the authorization of online lottery.

Penn National Gaming, which operates four of Ohio’s 11 casinos/racinos, wants to make sure the legislature isn’t setting up a state-run online casino masquerading as iLottery.

“If the lottery wants to sell traditional lottery products online – in other words anything that doesn’t simulate a slot machine – we’re ok with that,” said Eric Schippers, Penn National’s senior vice president of public affairs and government relations. “We don’t think we should have to be in a position to compete against the state.”

What Ohio lottery could offer online

Schippers attests that the Ohio casino/racino industry would lobby against any bill that included a competing slot machine-like online product.

However, Penn would not oppose allowing any products currently offered at lottery retailers online.

This includes:

  • Draw games in which players pick numbers drawn at random.
  • Scratch-off tickets where people use the mouse to click squares, revealing symbols.

Penn doesn’t want the lottery to offer a competing online slot machine product that would cannibalize the existing operators.

“We’ve invested hundreds of millions of dollars into the casinos and racinos business in Ohio,” Schippers said. “To grant the Intralot lottery guys a monopoly on online casino games would be a devastating blow to the state’s casino industry.”

Penn doesn’t want Ohio to become another PA

For an example of what Penn National fears online lottery becomes in Ohio, look no further than neighboring Pennsylvania.

What started as basic scratch-off tickets evolved into what are called instant games. These games feature multiple columns and a “reveal all” feature that had some suggesting they bear a resemblance to slot machines.

Pennsylvania casinos, including Penn National, filed a lawsuit against the PA Lottery in 2018. Schippers revealed that casinos are in settlement talks with the state, going back and forth on compromise language.

However, Schippers explained that Pennsylvania is different from Ohio. In PA, the law prohibits simulated slot machines.

That is not the case in Ohio. There wouldn’t be a legal challenge if Ohio authorized the lottery to offer slot-machine like games. But Schippers hopes it doesn’t happen for the sake of the casino industry.

“We’re not making the argument that it is expressly in violation of the law,” Schippers said. “We’re making the argument that it would have a negative impact on the incumbent casino and racino operators in the state, on the jobs and revenues we can produce.”

An alternative for Ohio internet lottery

If the lottery wants to offer a slot machine product, there is an avenue to get the casino industry’s support.

As owner of two Ohio casinos and two racinos, Penn is regulated by the Casino Control Commission and Lottery Commission.

Schippers said Penn National would be willing to have discussions with the Lottery Commission on offering online video lottery terminals (VLTs) through its license as a lottery provider.

“If the state desires to offer online VLTs, it should be through the existing online partners — the racinos,” Schippers said.

Lawmaker considering Ohio online lottery language

Sen. Bill Coley told PlayOhio that he planned to introduce an amendment to H 194 that included internet lottery. He believes the lottery already has the authority to expand its products online. But he thinks the commission could use a push from the legislature.

Asked to clarify his intentions on the iLottery language, Coley indicated that he is still exploring the details.

“I will continue to have discussions with members of my caucus about the language of the bill, but I don’t anticipate those conversations happening until after the election,” Coley said.

Ohio’s sports betting bill won’t have the opportunity for passage until the legislature returns for a lame-duck session in mid-November.

“This has been such a protracted debate in the House and Senate that we think less is more at this point,” Schippers said. “We’re just hoping we can get this moving now without complicating it by damaging the very industry this bill is seeking to help.”

Matthew Kredell Avatar
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Matthew Kredell

Matthew has covered efforts to legalize and regulate online gambling since 2007. His reporting on the legalization of sports betting began in 2010 with an article for Playboy Magazine on how the NFL was pushing US money overseas by fighting the expansion of regulated sports betting. A USC journalism alum, Matt started his career as a sportswriter at the Los Angeles Daily News and has written on a variety of topics for Playboy, Men’s Journal, Los Angeles magazine, LA Weekly and ESPN.com.

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