For those living in Omaha or Lincoln, Nebraska, the only way to legally gamble at casinos has been to travel across the border and head to Iowa properties in Council Bluffs.
Take the College World Series, for example. This weekend, fans from across the country will travel to Omaha for a chance to watch their team vie for college baseball supremacy. The games take place at the Charles Schwab Field in downtown Omaha. For fans looking to gamble in between games, the only legal option is to travel about five miles to three casinos just across the Iowa border.
That’s set to change in the near future, though.
In early June, WarHorse Gaming applied for licenses for proposed casinos in Omaha and Lincoln — Nebraska’s two largest cities. It’s a major step forward after Nebraska passed ballot issues surrounding casino gambling in 2020. The state officially approved the Nebraska Racing and Gaming Commission’s rules and regulations in May.
“The state of Nebraska really gets one chance to make a really good first impression out of the gate,” WarHorse representative Drew Niehaus said. “So having that patience — and knowing that what they came up with for rules and regulations — is solid. We really didn’t have any challenges or issues with the rules and regs when they released them for review. They did a great job. On our end, having that level of patience has paid off.”
When will work on the Nebraska casinos be complete?
Niehaus expects groundbreaking to commence this summer in Omaha before completion in 2023.
“We’re going to have some gaming options while construction is going on in early first quarter, first half of 2023,” Niehaus said. “And then hopefully full-open by the end of the year.”
According to Niehaus, the new casinos will feature a cashless option and house the newest games available.
“Nebraskans are ready for this,” Niehaus said. “They have been since the election was over in 2020. There’s been a lot of input from the state as far as the citizens go. They’re very excited for this as an opportunity. I think a lot of Nebraskans see this not just as a new industry in the state, but overall, just a big boost for Nebraska. You’re talking literally thousands of jobs across the state.”
The WarHorse casinos in Omaha and Lincoln will help with property tax relief
One benefit to casino gambling is that taxes generated at those facilities can in turn help Nebraskans with property tax relief.
“We’re really hoping Nebraskans choose to keep their money in Nebraska and reap the rewards of some of that tax revenue as a result of it. For us, that means to the tune of 20 cents of every dollar goes to property tax relief in Nebraska.”
Niehaus explained how the property tax factors into gambling revenue in Nebraska.
“Seventy percent of the tax money (from gambling) goes directly to property tax relief. Then 25% of the tax revenue will go to the county and the city. They will split that where each of these casinos are located. The final five percent is split. That will go 2.5% to the general fund and 2.5% to the commission of problem gambling in the state.”
How do the Nebraska casinos affect Iowa?
Brian Ohorilko, the administrator for the Iowa Racing and Gaming Commission, said analysis conducted by two companies indicate a decline in the Council Bluffs market when the Omaha and Lincoln casinos are fully operational. Spectrum Gaming’s study indicated that two Nebraska casinos would result in a 45% decline in the Council Bluffs market. The Innovation Group projected a 38% decline.
Operators in the market, though, projected not as steep of a decline, according to Ohorilko. From what the IRGC has been told, Council Bluffs operators predict a 25-33% decrease in business.
“The challenge really will be what are the Iowa facilities doing to compete?” Ohorilko said. “Are they reinvesting back into their facilities? Are they providing entertainment options? Those are questions that the Council Bluffs facilities need to make and they need to answer, and also in Sioux City. What will they do to respond?”
In fiscal year 2021 (July 1, 2020-June 30, 2021), Ameristar II in Council Bluffs totaled roughly $165 million in gross revenue. Harrah’s did $58 million and Horseshoe totaled about $180 million. In turn, those casinos generated roughly $32 million, $11 million and $39 million in taxes, respectively.
So far in fiscal year 2022, Ameristar II totaled about $173 million in revenue ($33 million in taxes), Harrah’s did $68 million ($13 million) and Horseshoe totaled $195 million ($42 million).
How will Iowa casinos respond to Omaha and Lincoln’s development?
The three Council Bluffs casinos made up just more than 25% of Iowa’s total casino revenue in FY21. With the industry studies in hand, the focus then turns to Iowa casinos’ response.
“I do think that it is starting to move, really push the question of ‘When is the appropriate time to reinvest and how much?'” Ohorilko said. “It’s moving that to the forefront for Iowa properties. That for sure is a positive development. It’s always important and a good thing for the state when we’re seeing a reinvestment into our facilities and we’re seeing different types of non-gaming amenities that come into the state. I do believe that’s what we’ll see from the Iowa properties in response to this.”
The Iowa casinos have options, however. Aside from upgrading the casinos and machines themselves, Ohorilko pointed to the dog track in Council Bluffs, which sits vacant, as one area for repurposing.
But the casinos in Iowa have time, too. They’ll still be able to reap the benefits of travelers during the College World Series next year and this weekend. Speaking of baseball …
2022 College World Series odds
For those in Iowa (or those visiting from Omaha), you can place bets on the 2022 College World Series.
Texas and Stanford are leading the pack at BetMGM, both clocking +400 odds to win the event. Arkansas and Notre Dame follow at +500. Here’s a complete look at the odds:
- Texas: +400
- Stanford: +400
- Arkansas: +500
- Notre Dame: +500
- Texas A&M: +600
- Auburn: +650
- Ole Miss: +800
- Oklahoma: +800
