The Iowa House approved a bill Thursday imposing a five-year moratorium on new casino licenses, setting the stage for a potential halt to casino expansion in the state. The measure, House File 144, passed with a 68-31 vote and, if enacted, would prevent any new casino developments until June 30, 2030.
The legislation gained momentum as lawmakers sought to preempt the Iowa Racing and Gaming Commission (IRGC) from issuing a license for the Cedar Crossing Casino and Entertainment Center, a proposed $275 million development in Cedar Rapids. The IRGC is set to consider the license application on February 6, adding urgency to the legislative push.
Supporters of the bill argue that new casinos, particularly in Cedar Rapids, would divert revenue from existing gaming establishments, negatively impacting both businesses and the communities they support. Rep. Bobby Kaufmann, R-Wilton, who introduced the legislation, cited IRGC-commissioned studies showing that over 50% of Cedar Crossing’s projected revenue would come at the expense of other Iowa casinos.
“I think the studies show significant cannibalism is very real,” Kaufmann said, as per Iowa Capital Dispatch. “And I do believe we are in the correct purview to tell the Iowa Racing and Gaming Commission how they should make major decisions.”
Opponents of the moratorium, including Rep. Sami Scheetz, D-Cedar Rapids, argue that lawmakers are interfering in a regulatory process that should be left to the IRGC. The commission has previously rejected casino proposals in Cedar Rapids in 2014 and 2017, citing concerns over market saturation.
“In no other industry in the state of Iowa do we have these kinds of anti-competitive rules,” Scheetz said. “That goes against the basic principles of free markets and competition.”
Beyond the moratorium, the bill includes new restrictions on future casino license applications. Once the freeze is lifted, new facilities would be prohibited if projections show they would reduce the adjusted gross receipts of an existing casino by more than 10% or negatively affect the annual distributions of a qualified sponsoring organization.
Additionally, counties where the IRGC has denied a license in the past eight years would be barred from applying. While the House debated the measure, the Senate moved quickly to advance a companion bill, Senate Study Bill 1069.
The Senate Local Government Subcommittee approved the measure Thursday morning, followed by full committee approval in the afternoon. This rapid progression positions the bill for debate in the full Senate next week, allowing lawmakers to act before the IRGC’s scheduled meeting.
The proposed moratorium has drawn opposition from Cedar Rapids Mayor Tiffany O’Donnell, who urged lawmakers to allow the regulatory process to proceed. She also pointed to Elite Casino Resorts CEO Dan Kehl, whose company operates multiple Iowa casinos and has recently expanded into Nebraska and Illinois. O’Donnell questioned why concerns over competition applied to Cedar Rapids but not to Kehl’s out-of-state developments.
Trade organizations and business leaders in Cedar Rapids and Linn County have also opposed the moratorium, arguing that blocking new casinos would prevent economic growth. Meanwhile, industry representatives supporting the bill warn that additional casinos could threaten existing jobs and revenue streams.
Matt Hinch, representing Elite Casino Resorts, defended the moratorium, stating that new competition would harm established casinos and their employees. “We have 19 commercial casinos and four tribal casinos in the state of Iowa—the market is absolutely saturated,” Hinch said.
In the Senate debate, Sen. Zach Wahls, D-Coralville, echoed concerns that the legislature was overstepping its authority and undermining the role of the IRGC. If passed, Wahls said, “We should have a conversation about ending the Racing and Gaming Commission.”
However, Sen. Scott Webster, R-Bettendorf, dismissed claims that the bill unfairly targeted Cedar Rapids, saying the moratorium was necessary to regulate statewide casino expansion.
If the Senate approves the bill, it will head to Gov. Kim Reynolds for final consideration. While Reynolds has not publicly stated her stance, Kaufmann said he is “personally confident” she would be open to signing the measure if it reaches her desk.
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