State Revenue Forecast Stable, But Gambling And Smoking Cash Evaporating

Dec 18, 2014

Governor Pence says he wants to use the state's revenue picture to push for more education initiatives.
Credit Jim Nix /

Indiana’s gaming revenue has been in free fall for a few years, and it’s predicted to continue its drop in the upcoming two-year budget cycle. 

That’s in large part because of increased competition from neighboring states. 

A legislative study committee is proposing changes to the industry that include moving riverboats on land, allowing live dealers rather than electronic table games at racinos, and tax incentives. 

But State Budget Committee chair Luke Kenley (R-Noblesville) says the gloomy outlook doesn’t mean more pressure on the legislature to enact those proposed changes.

“It’s just the competitive posture has changed that marketplace so much that I don’t think you can recover the whole thing,” Kenley says.

Cigarette taxes are expected to drop around two percent in the next biennium, but Kenley says he’s not concerned.

“I think we want people to smoke less, so I’m willing to deal with that issue," Kenley says.  "If they smoke less and we collect less cigarette taxes, that indicates a success on that front and we’ll have to figure out how to solve our fiscal problems in another way.”

Governor Mike Pence’s proposed healthcare expansion relies in part on cigarette tax revenues to pay for his plan.