Gambling Consultant Tells Louisiana What Sports Bettors Already Knew

• Spectrum Gaming Group has submitted a critical analysis of Louisiana’s gambling industry.
• The consultancy firm has three major recommendations for increasing state gambling revenues.
• Sports betting could be legalized in Louisiana this year.

BATON ROUGE, La. – At the behest of Gov. John Bel Edwards’ Administration, a gambling consultancy firm has determined that in order to compete with surrounding states (namely Mississippi), Louisiana must make changes to its gambling laws.

The report was assembled by Spectrum Gaming Group and issued to the Louisiana Economic Development (LED) agency. Fittingly, it shines a light on the specific issues facing the state’s gambling industry going forward.

Chief among the revelations (which, frankly, echo what the dramatic majority of the gambling public has been saying in the Bayou State for years) is that Louisiana needs to lower gaming taxes, relocate a pair of casinos, and legalize sports wagering.

Tax Reduction

The first, most pressing financial issue on the table is taxation. Mississippi casinos are taxed by their state at a rate of 11.6 percent, while Louisiana casinos are taxed at a rate of 26 percent.

This disparity not only allows Mississippi casinos to be more profitable; it also gives them the overhead space to more regularly upgrade their venues and advertise in Louisiana.

According to Spectrum, this equates to $255 million in measurable losses to the Louisiana gaming marketplace.

Spectrum also recommends that Louisiana cease its practice of taxing gaming vouchers and promos given out to casino patrons. Mississippi does not tax these perks, which gives the neighboring state a huge edge in attracting nearby Louisiana players.

Spectrum also recommends that the state lower its take of lottery gross revenue, which currently sits at 35 percent. By eliminating gross revenue sharing, the Louisiana Lottery could increase ticket sales twofold and generate an extra $30 million for the state annually.

Casino Relocation

Louisiana has 20 gambling venues: 15 riverboat casinos, one land-based casino, and four racinos. Of these, zero are located in the northeastern part of the state.

As a result, gamblers in this region simply cross the border to spend their time and money in Mississippi hotspots. According to Spectrum, prospective gamblers are not willing to regularly drive more than two hours to their casinos of choice.

To stem this outflow and keep more Louisiana money in Louisiana, Spectrum recommends that two Shreveport-Bossier City riverboat casinos relocate eastward. This would give casino customers in the northeastern part of the state easier access to proper Louisiana gaming venues.

By moving one casino to North Shore and another to a yet-undecided spot in the northeast corner of the state, Louisiana could effectively recapture a significant portion of this lost revenue stream.

Legal Sports Betting

The final piece of the puzzle for rehabbing Louisiana’s flagging gambling market is to introduce sports betting as soon as possible.

The consultancy firm has worked out that with easily accessible sports wagering in the state, Louisiana would generate between $35 million and $50 million in yearly revenue.

Further, according to the research offered, gambling venues that offer sports wagering enjoy a roughly 15 percent increase in food and drink sales during more popular sporting events and tournaments.

However, Spectrum has been careful to note that sports wagering ought not to be limited to land-based or riverboat venues. Instead, to maximize revenue, the state must legalize online sports betting statewide.

Finally, Spectrum has set a recommended maximum tax cap on Legal Louisiana sports betting at 15 percent, claiming that higher rates will increase house takes at the cost of bettor participation.

Hopefully, this report will help Louisiana legislators force the issue during the current congressional session, which was convened Monday.

The state is considering SB 153, which would install sports wagering at Louisiana’s physical gambling venues, and HB 459, an online daily fantasy sports bill that could have ramifications for Internet-based sports wagering in the future.

News tags: LA HB 459 | LA SB 153 | Louisiana | Louisiana sports betting