Poker Writer
Louisiana gambling operators have successfully found a loophole in a longstanding state law prohibiting casinos from making political contributions. The Louisiana Board of Ethics determined that a sports betting company does not qualify as a casino, even if it is a subsidiary of company that operates casinos in the state.
Since the early 1990s, a state law in Louisiana has prohibited casino companies and their executives from making political contributions. That includes the likes of Caesars, Boyd, Bally’s, Landry’s, and PENN.
Riverboat casinos are a significant business in the state that hugs and wraps around the Mississippi River. They have brought in as much as $1.7 billion in adjusted gross revenue over a 12-month period.
The ruling also applies to the executives of sports betting subsidiaries, so long as they don’t simultaneously hold positions in the parent company or another casino owner.
The Board of Ethics considered the issue at the behest of American Wagering Inc., which operates Caesars Sportsbook Louisiana and is a subsidiary of Caesars Entertainment. The ruling effectively creates a loophole for Caesars — and potentially other casinos in the state — to instruct their sportsbook subsidiaries to make donations, so long as the company structure is compliant.
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Gradual Shift in Favor of Gambling Operators
Following a controversial start to its riverboat casino industry, Louisiana made an effort to curb the influence of gambling in its politics. However, things have started to shift back in the other direction over the decades.
In 1996, not long after the introduction of the ban, the Louisiana Supreme Court ruled that small-scale video poker operators didn’t qualify as casinos for purposes of the ban. That exception applied to restaurants, truck stops, and the like, but not to larger venues.
From 2022 to 2023, the ethics board granted permission to individual companies, like Fanatics Betting and Gaming, to contribute to political campaigns. It extended to the same permission to trade associations like the Sports Betting Alliance.
Now, it seems any casino company can make donations through a subsidiary, as long as that subsidiary isn’t directly involved with the casino business.
It’s Hard to Keep Casino Money Out of Politics
Legislation to keep gambling industry money out of politics is popular with voters. However, the industry and the politicians who could benefit from the donations often try to find a way around it.
Indiana has a similar law to Lousiana’s, but has been plagued by scandals, starting in 2021 when two former legislators and a casino executives were charged with violating the rules. In 2023, former House Representative Sean Eberhart pleaded guilty to corruption charges following a deal in which he passed legislation favorable to Spectacle Entertainment, in return for a $350,000-per-year job with the company upon leaving office.
The scandal vindicated casino opponents who warned that things would get messy once gambling had established itself in the state. The fallout from the Eberhart scandal was sufficient that the legislature had to press pause on its iGaming efforts, as any proposal to expand gambling had become a non-starter with voters.
