Nebraska’s Gaming Tax Surges Following Record January

Nebraska's gaming tax continues its upward trajectory, surpassing expectations in February after reaching a record high in January. The state's gaming revenue, sourced from its four racinos, soared to over $1.7 million in February, marking an impressive 18.6% increase from the previous month's $1.4 million.

What to Follow:

1. Surging Gaming Tax Revenue: Nebraska's gaming tax revenue surged in February, surpassing the previous month's record high. The state collected over $1.7 million from its four racinos, marking an 18.6% increase from January's figures.
2. Mixed Performance Among Racinos: While three out of the four racinos demonstrated month-over-month progress in gaming taxes, WarHorse Gaming Omaha experienced a decline. Notable increases were observed at WarHorse Gaming Lincoln, Grand Island Casino, and Harrah's Columbus, while WarHorse Gaming Omaha reported a 33.5% decrease.
3. Legislative Response to Skill Gaming Concerns: Nebraska's Legislature advanced a bill, LB685, aimed at tightening regulations on “skill” video gaming machines found in bars and restaurants. This legislative move responds to concerns regarding the addictive nature of these devices and aims to impose taxes and fees to mitigate potential risks.

The Nebraska Racing Commission's February gaming tax report reveals significant month-over-month progress for three out of the four racinos, indicating a robust performance in the state's gaming industry. While WarHorse Omaha experienced a slight decline in gaming tax contributions compared to January, the remaining venues demonstrated notable improvements:

• WarHorse Gaming Lincoln reported a 13.9% increase, contributing $903,730.85 in gaming taxes.
• Grand Island Casino showcased a substantial 19.8% month-over-month growth, generating $588,911.29 in taxes.
• Harrah's Columbus emerged as a frontrunner with a remarkable 45.4% rise in gaming tax revenue, amounting to $211,722.62.

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Comparing February 2023 to February 2024, two Nebraska casinos demonstrated substantial year-over-year progress in gaming tax revenue. WarHorse Lincoln and Grand Island Casino and Resort both exhibited commendable growth, with a 5.30% and 21.8% increase, respectively. This growth is particularly notable considering the limited operations and absence of sports wagering at the time.

In legislative developments, a bill aimed at tightening regulations on “skill” video gaming machines gained traction in the Nebraska Legislature. Introduced by State Sen. John Lowe, LB685 seeks to address concerns surrounding “mechanical amusement devices” commonly found in bars and restaurants. With over 5,800 licensed skill games dispersed across more than 1,600 locations in Nebraska, officials have expressed apprehension regarding the addictive nature of these machines.

“In February, Nebraska's gaming tax revenue surged to over $1.7 million, reflecting an 18.6% increase from the previous month's record high. While three racinos demonstrated positive growth, WarHorse Gaming Omaha experienced a decline, highlighting mixed performance across the state's gaming landscape.”

Despite initial pushback from device operators, backers of LB685 emphasize the necessity of stricter oversight to curb illegal gaming activities. The proposed bill imposes a 5% tax on the machines' net proceeds, coupled with an annual fee structure aimed at mitigating potential risks associated with unchecked proliferation of these devices.

As Nebraska's gaming landscape evolves, stakeholders anticipate further developments in regulatory frameworks to ensure responsible and sustainable growth within the industry.