Last year, Washington State lawmakers became the first to legalize a sweeping sports betting bill allowing tribes to offer sports wagering exclusively. And while the state legislature smoothly and swiftly shepherded the proposal to Gov. Jay Inslee’s desk, it wasn’t uncontested. A commercial coalition led by Maverick Gaming CEO Eric Persson backed a commercial sports betting bill that would have allowed for wagering at card rooms and other locations. That bill died a quick death — or so it seemed.
A pair of lawmakers last week introduced SB 5212, which would legalize statewide mobile sports betting and retail wagering at Washington State card rooms and horse racetracks. It would essentially be an expansion of gaming, as the latest law allows for sports betting at tribal brick-and-mortar facilities only.
Lawmakers in Washington are doing what those around the country are doing with sports betting and other potential revenue streams — trying to plug a widening budget gap after a year in which the U.S. was fiscally ravaged by COVID-19 and restrictions imposed because of it. Washington lawmakers say all sports wagering revenue would be funneled toward helping the state recover from the COVID-19 crisis. Persson, according to the Seattle Times, estimates that Washington State could see $50 million annually in tax revenue should the bill pass.
’20 bill didn’t have bi-partisan support
“In the 2020 legislative session, Washington lawmakers gave access to sports betting exclusively to tribal properties, excluding private sector businesses like Maverick Gaming,” Maverick Gaming wrote in a letter to the WSGC. “While we have never disputed or opposed the ability of tribes as sovereign nations to offer sports betting, we are asking to be included in the opportunity.
“There is room for all licensed, regulated gaming operations to be successful, both in the more expansive destinations operated by tribal nations and within the far more modest neighborhood business setting of a licensed card room.”
#Maverick (@MavGamingCo) backs new bill for #sportsbetting in #Washington State #cardrooms https://t.co/vp3l39M1i1
— Turnpike Sports® (@TurnpikeSports) January 18, 2021
In 2020, Republican Rep. Brandon Vick introduced a bill that would have allowed for statewide mobile and retail gaming at card rooms and horse racetracks with a 10% tax rate on gross gaming revenue, a $500,000 application fee, and a college carve-out prohibiting wagering on Washington-based schools. The bill would have allowed for a single “skin” or mobile partner for brick-and-mortar locations.
In 2021, Senators Curtis King (R), Marko Liias (D), and Claire Wilson (D) are all named as bill sponsors — meaning the proposal not only has bipartisan support, but is being proposed by the majority party. Wilson is the assistant majority whip and Liias is the majority floor leader.
Detailed look at the bill
So, what’s in the bill?
- The tax rate would be set at 10% of ggr
- The Washington State Gambling Commission would be the regulator
- It would be illegal to bet on college teams from Washington State
- Digital daily fantasy sports wagering would be legal
- The application fee for a sports wagering operator license would be $100,000 and a “reasonable fee” for renewals would be adopted
- Each card room or racetrack would be entitled to one “skin” or mobile partner
- Digital platforms must not only be tethered to physical locations, sports betting must be offered at those locations
- The legal age for sports wagering would be 18
- The bill explicitly makes “sports boards” or squares games legal
SB 5212 was read in the Senate for the first time on Jan. 14 and has been assigned to the Senate Labor, Commerce, and Tribal Affairs Committee, but it is not on the committee agenda for this week. The legislative session opened on Jan. 11 and is set to adjourn on April 25.
Lawmakers say that even if their bill advances, no licenses would be issued to commercial sports betting operators until Washington’s tribes have completed their compacting process and are moving forward with sports wagering. At least four tribes are in the negotiation process, and the WSGC is planning to propose rules later this year. But the new bill does not mention the tribes.
“I view this as sort of an opening of that dialogue and working on, ‘How do we make sure we can do this in a safe and regulated way?’ ” Liias told the Seattle Times. “So, we’re continuing to let the tribal casinos go first, but respecting the fact that there are workers involved and that particularly there’s an opportunity to create family-wage jobs — which has been a real game changer in this industry.”
At least one source in Washington says this bill won’t get far, and that no House equivalent will be filed. To date, no sports betting bill has been filed in the House. Washington’s tribal lobby is extremely powerful, and lawmakers last year seemed to acknowledge the contribution the tribes make to the state. Considering all of that, it would seem a delicate process for lawmakers to be able to find a balance between the tribes and commercial interests.
Eric Persson, CEO of Maverick Gaming, will spend $20m to $30m this election cycle to stop a tribal-only sports betting bill from becoming law. He wants sports gambling expanded to the 19 in-state card-room casinos it bought over the past year @seattletimes https://t.co/T527C9wVBn
— Chris Sieroty (@sierotyfeatures) March 2, 2020
And it’s likely the tribes will push back on the this latest offering — but like last year, Maverick Gaming won’t just fold.
“I can tell you, Maverick isn’t going anywhere,” Persson told the Seattle Times. “And eventually, I think that the state of Washington is going to see things the way that we do. I’m optimistic we’re going to have a partnership that’s going to be a great service to constituents and generate a lot of tax dollars that are badly needed.”
WSGC shares pre-licensing draft rules
The same day the bill was filed, the WSGC held its monthly meeting. Ahead of the meeting, Legal and Legislative Director Brian Considine shared a draft of proposed sports wagering pre-licensing qualification rules. In the proposal, the WSGC wrote that a “substantial interest holder” in a sports wagering company would be subject to a pre-licensing investigation.
Multiple operators, including DraftKings, FanDuel, and William Hill, all asked for clarification of the phrase via public comment, as well as other technical clarifications.
The WSGC offered up pre-licensing qualification draft rules as a way to get ahead of the licensing process, which it expects to open later this year. The state must complete compact negotiations with at least one tribe before promulgating sports betting rules and opening the licensing process.