Indiana law authorizes ten land-based or riverboat casinos on Lake Michigan and the Ohio River, one land-based casino in French Lick, and racinos at the state's two horse tracks. In addition, there is one Indian casino in the state. Other forms of legal gambling are the Hoosier Lottery, parimutuel wagering on horse races, and sports betting.
Lottery
The Indiana Constitution of 1851 included a ban on lotteries, which was broadly construed by courts as a prohibition on gambling in general. In 1988, state voters approved a constitutional amendment lifting the lottery ban, establishing the Hoosier Lottery.
The Hoosier Lottery sells scratch-off tickets since October 1989. It is a member of the Multi-State Lottery Association since 1990. and co-founder of Powerball in 1992. It joined Mega Millions in 2010 and Cash4Life in 2016. Other draw games include Hoosier Lotto, Cash 5, and Poker Lotto.
Horse racing
Pari-mutuel betting was legalized in 1989. Harrah's Hoosier Park opened in Anderson in 1994, and off-track betting parlors opened in the state in 1995. Indiana Downs (now Horseshoe Indianapolis) opened in Shelbyville in 2002. Hoosier Park became a racino on 2008 and Indiana Downs did the same in 2009.
Casinos
Legalization efforts
Critics of lottery legalization said the measure would lead to casino gambling, while legislators said there would be little support for casinos.
Within months of the amendment's passage, Gary mayor Thomas Barnes proposed opening up the economically depressed city to high-rise resort casinos. The Indiana General Assembly rejected a Gary casino bill in 1989, but did assent to a non-binding referendum, which city voters approved by 60 percent. The city began talks to acquire 350 acres of land at the Gary Works for as many as five casinos.
Gaming companies from Nevada and Atlantic City flocked to join in lobbying efforts to support a second attempt in the 1990 legislative session, but it was blocked by Senate Republican leaders. In the 1991 session, state Rep. Charlie Brown of Gary introduced an expanded bill authorizing riverboat casinos on the Ohio River and a casino in the resort area of French Lick and West Baden Springs, to attract broader support. The mayor of Hammond floated the idea of converting the SS Clipper into a casino, but it was not included in the bill. The proposal passed the House but was rejected by a Senate committee.
Brown introduced a Gary casino bill in the 1992 session, but it drew little support due to legislators' aversion to controversy in an election year. Southern Indiana legislators introduced a bill to allow riverboat casinos on the Ohio River, which passed the House, and was then expanded, with support from Gary lawmakers, to include boats on Lake Michigan, which were seen as less controversial than land-based casinos. The bill was rejected by the Senate.
With new backing from Republican entrepreneur Dean White, Brown reintroduced his bill in the 1993 session, with land-based casinos in Gary and French Lick, and riverboats on the Ohio River, and it passed the House, but was again voted down in Senate committee. A measure was introduced later in the session to allow four riverboats each on Lake Michigan and the Ohio, but it was killed by Senate leaders.
Because it failed to approve a budget, the Assembly convened for a special session in June 1993. After weeks of wrangling, a compromise was reached on a Republican budget with no tax increases, with a few side issues to appease Democrats, including authorization of riverboat casinos. The law allowed up to five sites on the shore of Lake Michigan (including two in Gary), five on the Ohio River, and one on Patoka Lake, near French Lick. Casinos were expected to raise at least $100 million in taxes per year.
Licensing and construction
The first round of gaming license applications in September 1993 attracted 27 proposals for sites in 12 cities. Local referendums, required to authorize casinos in each city or county (except Gary), were held in November; voters in Clark, Floyd, Porter, and Warrick counties rejected casinos, while voters in Hammond and East Chicago and in Dearborn, LaPorte, Ohio, Switzerland, and Vanderburgh counties approved them.
February 2, 1994 was the application deadline for licenses in the communities where referendums had passed; by that day, the number of applications had risen to 50. Officials in some cities conducted extensive hearings to decide which applicants to endorse, though the final decisions were in the hands of the Gaming Commission. City leaders examined 25 proposals in Gary, 6 in Evansville, and 8 in Lawrenceburg.