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Analysts and pundits are predicting a wave of states will legalize sports betting in 2019. If Tuesday’s marathon hearing in Connecticut is any indication, the wave might be more of ripple.
Sports betting isn’t the most important gambling issue in Connecticut
Connecticut is on most people’s short list of candidate states, but the near 11-hour hearing painted Connecticut as anything but a slam dunk to legalize sports betting this year.
The big takeaways from the hearing are:
- Gambling legislation is always tricky
- Sports betting is not at the top of Connecticut’s priority list
The topic of sports betting in Connecticut was barely broached for several hours, as the legislature and witnesses focused on the yet-to-be-resolved matter of the East Windsor satellite casino.
When sports betting was discussed, the fallacy that the two Connecticut tribes would be in the driver’s seat and guide policy was laid bare. Connecticut gaming is more than Foxwoods and Mohegan Sun, and plenty of others want in.
There was little agreement between the representatives from MGM, DraftKings, the professional sports leagues, the Connecticut Lottery and the two tribes who testified. All are potential stakeholders and all envision sports betting coming to the Nutmeg State in radically different ways.
That’s a scenario that’s likely to play out across the country.
There hasn’t been a lot of legislative progress
With legislation filed in more than half the states in the country, sports betting is definitely a hot topic. But the introduction of legislation is the first, and easiest step in the process. ing a bill that expands gambling is no small feat.
In addition to the growing queue of states considering legal sports betting, 10 states and the District of Columbia currently offer, or are preparing to offer legal sports betting:
- Nevada
- Delaware
- New Jersey
- Mississippi
- New York
- New Mexico
- West Virginia
- Pennsylvania
- Arkansas
- Rhode Island
- Washington, DC
That seems like a lot of momentum, but it’s only half the story.
The truth is, sports betting’s legislative success since the US Supreme Court ruling is modest.
- Nevada has been offering legal sports betting for decades.
- New Mexico tribes started offering sports betting without legislation thanks to a favorably worded tribal compact with the state.
- Four early-adopter states pre-legalized it, tackling the subject when it was still a hypothetical on their wish lists and not the hot-button issue it is today: Delaware, Mississippi, Pennsylvania and New York (pending).
In reality, only four states and the District of Columbia have legalized sports betting through normal legislative channels following the SCOTUS decision:
- Rhode Island
- New Jersey
- Arkansas
- West Virginia
- Washington, DC
The sports betting legislative process is messy
Most states coming on board in 2019 are going to have to do so through standard legislation, and if Connecticut is any indication, that’s going to be a messy process.
Like Connecticut, very few states have a single gaming stakeholder.
Existing gaming operators, from commercial casinos to tribal casinos, from the lottery to horseracing will make the case that they alone can best manage sports betting, or should receive some special concession, as they try to shut outside entities and local competitors out.
And that’s only the beginning:
- The professional sports leagues will continue to argue they deserve a cut for integrity and/or data rights.
- Legislators will argue over tax rates and whether to legalize online betting or limit sports betting to retail locations.
- Adding online poker, casino or daily fantasy sports will enter the equation in some locales, causing more divides and further muddying the water.
Not to mention, this is occurring amidst the uncertain backdrop of an ambiguous Wire Act opinion from the Department of Justice, and the possibility of Congress tackling sports betting and beyond.
And, of course, there’s the longstanding legislative aversion to expanding gambling in statehouses across the country.
