Nebraska legislators are debating whether to expand the state's nascent sports gambling industry to include online wagering, a move that supporters claim could recapture millions in tax revenue currently flowing to neighboring states.
The Nebraska General Affairs Committee heard testimony Monday on several gambling bills, including different approaches to legalizing mobile sports betting:
LR 20CA - Sen. Eliot Bostar's (D-Lincoln) constitutional amendment would put online sports betting on the ballot for voters to decide
LB 421 - Sen. Stan Clouse's (R-Buffalo) bill would provide the framework if voters approve, allowing each of the state's six casinos to partner with one online sportsbook operator
LB 438 - Sen. Ashlei Spivey's legislation would legalize online sports betting without requiring a constitutional amendment
"The demand for mobile sports betting is clear," Bostar told fellow lawmakers. "It's in our best interest to regulate and benefit from it."
Bostar believes the state is missing out on approximately $32 million in annual tax revenue, with Nebraska bettors taking their business to neighboring Iowa, Colorado, and Kansas where online sports betting is already legal.
Nebraska's gambling market is relatively new compared to many states. Voters approved expanded gambling through a 2020 ballot initiative that allowed for retail casino gaming and in-person sports betting at licensed "racinos" — racetracks with casino operations.
Four casinos currently offer retail sports betting: WarHorse Lincoln, WarHorse Omaha, Grand Island, and Harrah's Columbus. However, the financial results highlight the limitations of in-person-only wagering:
Nebraska sportsbooks won just $4.7 million from bettors in 2024
West Virginia, with 200,000 fewer residents but mobile betting, saw sportsbooks win $56 million in the same period
Nebraska's four casinos generated a combined $25.5 million in total tax revenue in 2024, up from $17.8 million the previous year
The push for online sports betting gained momentum last year when Gov. Jim Pillen sought ways to provide Nebraskans with property tax relief. Currently, approximately 70% of gambling revenue is directed to property tax relief.
During the last fiscal year, retail sportsbooks sent approximately $2 million in tax payments to the state. Bostar's previous enacting legislation would have increased the sports betting tax revenue percentage allocated to the property tax relief fund to 90%.
Opposition testimony at Monday's hearing outnumbered supporters, with critics raising concerns about the social costs of expanded gambling access.
"You were elected to protect constituents, not to prey on them," Pat Loontjer, executive director of Gambling With The Good Life, told lawmakers.
Nate Grasz, the Nebraska Family Alliance's executive director, suggested that if sportsbooks want online betting on the ballot, "they should get the signatures in a petition" rather than having lawmakers do it for them.
The committee is also considering other gambling-related bills, including:
Legislation to remove the prohibition on betting on Nebraska college teams when they play in-state
Sen. Tom Brandt's proposals (LB 63 and LB 342) to expand wagering on in-state college teams and legalize daily fantasy sports
The current legislative session runs until mid-June, giving lawmakers ample time to consider these proposals.