States race to pass sports betting laws after Supreme Court decision
A year after the U.S. Supreme Court struck down the federal law that banned sports gambling, residents of eight states are legally betting on professional and college games, and several jurisdictions are close to offering wagering.
The wave has not reached Washington state, and bettors might have to wait years before legal wagering on major sports arrives.
Legislators sponsored three bills this year to allow gambling on pro and college sports, along with the Olympics and other international contests such as soccer’s Champions League. None came close to approval.
The one that received the most attention, HB 1975, sparked controversy because it would have allowed Las Vegas-style sports books only at tribal casinos. Trade groups representing house-banked card rooms, sports bars and restaurants voiced their concerns about being cut out of the action.
“We believe excluding these businesses from participating in sports wagering will offer an unfair advantage to those who can,” Zachary Lindahl, a lobbyist for the Washington Hospitality Association, told lawmakers at a committee meeting in February.
Leaders of several Indian tribes who were behind HB 1975 said they support sports gambling if it’s limited to their casinos. They stressed that they have a track record of offering gambling under federal and state regulation, and the revenue has enabled them to offer many services to their people, including paying for college tuition and helping elders with health care.
“We are now able to fulfill many of the broken promises made through history to Indian tribes for the loss of our land and our resources,” said William Iyall, chairman of the Cowlitz Indian Tribe, which operates the Ilani Casino Resort in Clark County.
The Washington Horse Racing Commission voted to oppose the bill, which would not have allowed gambling on pro and college sports at the Emerald Downs Racetrack & Casino in Auburn. The Muckleshoot Indian Tribe operates the thoroughbred racetrack through its firm, Emerald Downs Racing LLC, but the track is not on tribal land. The tribe could offer sports gambling at its Muckleshoot Casino on the reservation in Auburn.
“Horse racing is not just Emerald Downs,” said Doug Moore, executive secretary of the horse racing commission. “It’s the breeding farms, the people who grow the hay and the oats. As these other forms of gaming have come in — the Lottery, the tribal casinos, the house-banked card rooms — we’ve never got any consideration. It’s an agricultural industry, not just a wagering industry.”
The question of who would profit from legal sports gambling is not the sole reason HB 1975 failed to reach the House floor.
Besides the crush of issues which legislators tackled this year, sports gambling is a new concept for several of them and that often means debating the pros and cons over multiple sessions, said Rep. Eric Pettigrew, the Seattle Democrat who was the bill’s lead sponsor.
Several legislators also have expressed concern about the extent to which another betting option would lead to more gambling addiction, he added.
“Hopefully, we can help convince them that we have got enough things in place that will help folks if they need it,” said Pettigrew, first elected to the House in 2002.
Pettigrew said he plans to try again next year to get the bill passed.
Some legislators and state officials said it might be difficult during a 60-day session, which are held in even-numbered years. If so, that would push the debate to the 105-day session in 2021.
“We don’t fully understand the economic impact or opportunity from sports betting,” said Rep. Kristine Reeves, a Federal Way Democrat who is vice chairwoman of the House Commerce & Gaming Committee. “I think it is going to be a conversation we continue to have for the next session or more. For me, it’s, `What are other states doing and how do we make sure we don’t lose out on this opportunity as other states advance this?’”
If a sports wagering bill passes, the state Gambling Commission would negotiate contracts on the details with the tribes under the federal Indian Gaming Regulatory Act. There are 29 federally-recognized Indian tribes in Washington state, and all have a gambling contract, commonly referred to as a compact, with the state.
Gov. Jay Inslee, a Democrat running for president, has not taken a position on sports gambling, said spokeswoman Tara Lee.
“We hope that the Legislature would look to the Washington State (Gambling) Commission to provide its expertise about a regulatory structure for sports betting. And like all gambling in our state, it’s the governor’s responsibility, through the Commission, to protect the public by ensuring that gambling is legal and honest,” Lee said in an email.
Sports wagering technically is legal in Washington state, but only in an extremely narrow fashion. That’s why state officials don’t talk about proposals to legalize sports gambling. Instead, they say legislation like HB 1975 would authorize a major expansion in that type of betting.
When the Legislature passed the Gambling Act in the 1970s, it authorized 100-square sports pool boards. Businesses and individuals can charge up to $1 per square for a single sports game, like the Super Bowl. Numbers representing final scores are randomly assigned to each square.
Because no license is required for sports boards, it’s unclear precisely how many people use them, but the number is low because they involve such small amounts of wagers, said Brian Considine, the state Gambling Commission’s legal and legislative manager.
Fantasy sports, bracket pools such as the NCAA basketball tournament and office sports pools are illegal in Washington state.
The American Gaming Association, a casino industry group, has estimated that $58 billion is bet on National Football League and college football games annually, most of it illegally.
Neighboring states are moving toward trying to capture as much of that market as they can.
Oregon wants to offer gambling on the NFL by the start of this year’s season. Plans call for adding Major League Baseball, the National Basketball Association, the National Hockey League and Major League Soccer, said Matthew Shelby, spokesman for the Oregon Lottery Commission.
Oregon lottery officials are negotiating a contract with a private firm to provide an online sports betting platform, Shelby said.
Earlier this month, Montana’s governor signed a bill to legalize sports gambling through kiosks and mobile devices. Like Oregon, the state’s lottery would oversee wagering.
The Idaho legislature did not consider any sports betting bills this year.
In Washington state, HB 1975 would have allowed internet sports gambling only if the person is inside an Indian casino.
That would be done through “geo-fencing,” technology enabling bettors to wager and cash out on a mobile application. The app would not work outside the tribal casino.
David Bean, vice chairman of the Puyallup Tribe of Indians Council, said sports gambling would be another amenity for customers at the tribe’s Emerald Queen Casino in Tacoma.
“It will be a first-class experience for our customers. I’ve walked by many of those sports books in Vegas, and they roll it out for those gamers; comfortable seating, food is brought right to them, big-screen TVs,” he said.
If the Legislature restricts sports gambling to tribal lands, the state and local governments would not receive tax revenue. Pettigrew, the lead sponsor of HB 1975, said tax dollars would flow if gamblers opted for lodging and restaurants off Indian land.
The Washington Hospitality Association and other trade groups, including the Recreational Gaming Association of Washington, plan to continue to urge legislators to allow sports gambling beyond tribal land.
Victor Mena, chief operating officer of Washington Gold Casinos, said the state should tackle sports gambling the way it did the legalization of marijuana. One of the main legalization arguments was to move the pot trade from the black market to a regulated one in which the state receives tax revenue.
In 2012, Initiative 502 legalized the purchase and recreational use of marijuana in limited circumstances for those 21 and older.
“I’d like the state to benefit from the legalization of sports wagering by having commercial operators participate in that activity,” Mena said in a written statement.
Washington state has 45 house-banked card rooms with a proven track record under regulation from the state Gambling Commission, said Dolores Chiechi, executive director of the Recreational Gaming Association of Washington.
“We certainly would be excited about having a new activity to offer our patrons. While we don’t see it as a huge windfall of extra revenue, it certainly might keep someone in our building to have a burger and gather their friends to watch a game, and then possibly sit at the table and play a $20 round of cards,” Chiechi said.
Pettigrew said if lawmakers approve a bill to allow sports gambling only at tribal casinos, someone could pursue an initiative so voters could decide whether to expand it to house-banked card rooms, sports bars and restaurants, and Emerald Downs.
“I have no idea how anything like that would play out,” Pettigrew said.
On Thursday evening at the Pole Position Sports Bar in Tacoma, Pete Prezeau celebrated his 60th birthday over a beer and dinner as the big-screen TVs featured a Major League Baseball game. He said it should be an easy decision for the Legislature to let sports gambling move forward, like in several other states.
“I’m not a big technology guy, but it seems like you could do it on your phone,” said Prezeau, a construction worker who lives in Lakewood. “I don’t gamble anyway, but it should be legal.”
At the Tacoma Mall, which was bustling with shoppers Thursday night, 21-year-old cook Trystin Dimond of Midland agreed.
“If it’s offered at places like the Indian casinos and the horse-racing track, where gambling already is available, it should work out nicely,” he said.