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New sports-betting rules published, bar owners balk at restrictions

Ohio Lottery taking public comment until April 28
JimMoehring.jpg
Posted at 1:28 PM, Apr 22, 2022
and last updated 2022-04-22 14:24:10-04

CINCINNATI — The Ohio Lottery Commission this week published five pages of proposed rules for sports-betting kiosks in Ohio bars and restaurants, including one rule that left local bar owners scratching their heads:

“Unless otherwise approved by the director, no Type C sports gaming host shall have more than two self-service terminals operational at the licensed facility.”

Although the two-kiosk limit was part of a Senate bill that passed last June, Ohio’s sports gaming statute did not include a clear restriction when it passed last December.

“I don’t understand the limit,” said Jim Moehring, owner of Holy Grail Tavern & Grille at the Banks. “So, somebody is going to be able to sit right next to the kiosk on an app (and) place a full bet, but I can’t have four kiosks or I can’t have three kiosks? I can only have two kiosks?”

Moehring isn’t sure how many betting terminals his customers would support, but he’d like the opportunity to test more than two at a time.

“My gut tells me on a Reds game or a Bengals game, 20 minutes before the game starts, two is not going to be enough,” he said.

At Scoreboard Sports Bar in Miami Township, co-proprietor Kevin Olthaus said his customers might support up to five betting terminals.

“I’m not happy with that” two-kiosk rule, Olthaus said. “Unreal.”

Lottery officials could not be reached for comment on its proposed rules. But the lottery commission is taking public comments on them until April 28 so they could be revised prior to final adoption.

The rules generally follow the language of Ohio’s sports-gaming bill, which Ohio Gov. Mike DeWine signed into law on Dec. 22, two weeks after lawmakers passed it.

The Ohio Casino Control Commission is now writing the rules for three types of sports gaming licenses authorized by the law. Type A licenses will let up to 25 online operators compete against and partner with 40 retail, or brick-and-mortar sports books that obtain a Type B license.

Type C licenses will be issued by the Casino Control Commission but regulated by the Ohio Lottery. They’ll bring sports-betting kiosks to bars and restaurants by allowing up to 20 sports gaming proprietors to operate kiosks for and an unlimited number or sports gaming hosts, defined by the statute as lottery retailers with D1, D2 or D5 liquor permits.

Lottery officials have said they expect about 2,500 sports gaming hosts to pay the $1,000 fee for a three-year license in Ohio. On April 18, they published a list of rules and operating procedures they want hosts and proprietors to follow.

The operating procedures say proprietors will install kiosks, train gaming hosts how to use them and provide ongoing maintenance and technical support. Proprietors are allowed to pay gaming hosts to offer their products, but the number of kiosks at each location is “limited to two terminals unless the proprietor requests approval for additional units.”

That lottery restriction is different than the language used in the sports-betting bill that passed last December.

It required proprietors to “notify the Ohio Casino Control Commission” if it “intends to install more than two terminals,” with a stipulation that “the commission may disallow the installation of more than two terminals … in accordance with the commission’s rules.”

The Ohio Casino Control Commission has no restriction on the number of terminals in its Type C licensing rules. But the lottery now does.

“I don’t understand that. It’s crazy to me,” Moehring said.

Beyond the two-terminal restriction, Moehring is concerned about a lottery rule requiring gaming hosts to cash winning bets up to $599. He’s worried that will force the Holy Grail to keep thousands of dollars of cash on hand.

“It would be a security issue number one, but a bigger accounting issue,” he said. “As a lottery agent you do have to keep that straight and you have to reconcile it every night at 2:30 in the morning.”

The proposed lottery rule says gaming hosts “must pay prizes up to $599,” but it doesn’t say it must be paid in cash. However, the sports gaming statute says winners of “sports lottery gaming” can elect to receive their payments “in cash from any type C gaming host.”

Finally, Moehring is bothered by a restriction that isn’t mentioned in the newly proposed lottery rules but is locked into the sports-betting law. Kiosks can only offer four kinds of bets: spread wagers, over-under wagers, moneyline wagers and parlays of up to four component bets.

“So, they can go to the casino, make any bet they want,” Moehring said. “Or they can sit on their app, make any bet they want. But they can’t make full bets on our kiosk. Why?”

But those objections won’t keep Moehring from applying for a license later this year.

“We’re definitely going to have it. Sports gaming right now is such a huge industry,” Moehring said. “I’m glad it’s coming, glad to have it.”

The new sports-betting laws go into effect on January 1, 2023.