INDIANAPOLIS — When Indiana lawmakers first opened the door to legalized gambling 21 years ago, they were reluctant to bet it would become a stable source of revenue for the state treasury.

But as a series of recent reports show, state and local budgets in Indiana have grown dependent on the millions of tax dollars generated by games of chance, from lottery tickets to penny slot machines.

And as legalized gambling has expanded, Indiana has moved up in the ranks of total gaming revenues. Last year, the state became the third largest gaming destination in the nation, behind Nevada and New Jersey. This week, The Associated Press reported that Indiana was No. 2, behind Pennsylvania, in taxes collected from casino gambling.

That’s been good news for local and state governments that have used the money to replace dwindling revenues from other sources. But odds are against it continuing as Indiana faces increasing competition from neighboring states, including Ohio, which legalized casino gambling last fall.

“We’ve become addicted to gaming revenues,” said Ed Feigenbaum, editor of the Indiana Gaming Insight, the state’s leading source for news on the gambling industry.

Exactly how much money is coming into state and local governments from all sources of legalized gambling in Indiana is hard to track, given the many sources of gambling dollars coming into the state and the various agencies that keep track of it.

The Hoosier Lottery, which launched legalized gambling in 1989, reported a 17.5 percent decline in revenues in fiscal year 2009. It has yet to publish its annual report for fiscal year 2010.

There are numbers, though, that offer some revelation about Indiana’s legalized gambling venues — from riverboat casinos to charity bingos — that, according to Feigenbaum, grossed more than $4 billion last year alone.

For example, according to the Indiana Gaming Commission’s monthly reports posted online, gamblers spent $2.7 billion at the state’s 13 casino properties (including slot-machine casinos at two racetracks) in fiscal year 2010, ending June 30. From that, the casinos paid more than $872 million in admission and wagering taxes.

More than $558 million of that went into the state's general fund, according to the state's most recent budget report. The rest of the money was divvied up among state and local entities, with more than $33 million going to Indiana county governments.

A recent issue of Indiana Gaming Insight reveals a rise in gross revenues from charity gaming — the bingos, raffles and other gambling venues conducted by churches and social organizations and regulated by state government. They reported $538 million in gross revenues in fiscal year 2009, the latest year available. That’s the highest level in five years.

Another number recently released by the Indiana Alcohol and Tobacco Commission: $67 million spent on “pull tab” gambling in bars and taverns in Indiana between April 20, 2009, and April 19, 2010. Exactly how much tax revenue that’s generated for the state has yet to be published, but Feigenbaum says it will be significant.

All those numbers mean one thing, said Feigenbaum: Indiana has a gambling habit. “For a state that went into legalized gambling with a lot of reservations,” he said, “we’ve not just accepted it, we’ve embraced it.”

Maureen Hayden is statehouse bureau chief for CNHI’s Indiana newspapers. She can be reached at maureen.hayden@indianamediagroup.com.