October 25, 2020 3 min read

Nebraska’s New Racinos Proposal Faces Opposition

Three new initiatives to allow casinos at licensed horse racetracks will figure on Nebraska’s general election ballot in November. Opponents say that initiatives 429, 430, and 431 will lead to losses and gambling addiction across the state.

Political committee Keep The Money in Nebraska got the measures on November’s ballot via a petition. Nebraskans will be able to vote on casino gambling for the first time in 15 years, as voters rejected two proposals in 2004, one proposed by the legislature and one put on the ballot by petition. Another similar petition failed to garner enough votes in 2016.

About the Initiatives

Initiative 429 would amend the Nebraska Constitution to allow casino gambling at horse racetracks, or “racinos”.

Initiative 430 is a draft law which would authorize casinos at licensed horse race tracks and create a seven-member Nebraska Gaming Commission to oversee and regulate those casinos. It would also prohibit gambling at casinos for anyone under the age of 21.

Each casino operator would be required to pay a one-time license fee of $1 million but would be exempted from paying sales taxes on purchases.

Initiative 431 would tax the new racetrack casinos and direct tax money destinations. The annual gambling tax would be 20% of casino income, minus certain expenses. The law allocates 70% of the taxes collected to the Property Tax Credit Fund, 25% to the city or county where the track is, 2.5% to support treatment for compulsive gamblers and 2.5% to the State General Fund.

However, the government would still be able to limit gambling if Initiative 429 fails to pass.

Keeping the Money in Nebraska

Supporters estimate that Nebraskans spend about $400 million to $500 million at out-of-state casinos every year and claim that around $325 million would stay in Nebraska if casinos were to open in the state.

New tax revenues would bring $65 million a year from casinos, of which $45.5 million would go into the Property Tax Credit Fund, supporters say, adding that the new industry would also create 4,600 jobs. The money generated by casinos and racinos could lead to the revival of horse racing in Nebraska.

Lynne McNally, legal counsel for the Nebraska Horsemen’s Benevolent and Protective Association commented for Omaha, an outlet: “We should be garnering tax revenue and using it for things that Nebraskans desperately need.” adding that “Even if you never set foot in a casino and you’re a property owner in Nebraska, you would benefit from this.”

Opposition Says Backers Overestimate Positive Impact

Opponents said the initiatives would be “bad for families, bad for business, bad for Nebraska.”, and argue that the proposal will add social problems in the state, such as gambling addiction, bankruptcy, homelessness, or violence.

Gambling tax revenues are often overestimated, the opposition also said, and not sustainable over time, as competition increases. This will eventually affect lower-income households, who will have to pay more taxes.

“It’s a gimmick, it’s the ultimate budget gimmick,” said Les Bernal, national director for Stop Predatory Gambling. “This is taxation by exploiting your neighbor.”

After finishing her master's in publishing and writing, Melanie began her career as an online editor for a large gaming blog and has now transitioned over towards the iGaming industry. She helps to ensure that our news pieces are written to the highest standard possible under the guidance of senior management.

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