Iowa looks all set to be the latest state to legalize sports betting with support from legislators, casinos, and the state lottery.
The United States Supreme Court’s recent ruling that sports betting can be legalized throughout the country has led to a race by individual states to bring in new laws in their jurisdictions. Numerous states have already begun offering sports betting; others are still in the process of debating whether they should follow suit. It appears that Iowa is set to be the latest state to enter the sports betting realm.
Indications of Iowa legalization
For many states, the decision to legalize sports betting within their jurisdiction was an easy one. With revenues from illegal sports betting estimated at somewhere between $100bn (£75bn) and $150bn (£113bn) per annum, significant tax revenues could be generated in states that legalized the practice.
It appears that all the relevant parties in Iowa are in favor of sports betting legalization in the state. This includes retailers, casinos, and lawmakers. The question that remains is what the best way to introduce it may be. Iowa state representative Jake Highfill has said that both the Republican and Democrat politicians in the state are in favor of legalization, saying: “They’re all in”.
The Iowa Lottery said that since the Supreme Court ruling it had been inundated with phone calls from retailers looking to capitalize on any upcoming changes to state sports betting laws. They are actively looking into the potential offering of a sports lottery and how it might work with the lawmakers and vendors in the state.
The casino industry in Iowa is pushing for the introduction of legislation that would see sports betting legalized, including on mobile apps, which would allow people in the state to make bets on professional and college sports no matter where they are located in the state jurisdiction.
When might changes be made?
The window for the introduction of new legislation has now closed as the state session has finished until January. This means that no moves will be made until then. It is likely that this will be in the form of House File 2448, which has already received approval from the Ways and Means and House State Government committees in Iowa.
As a result of the Republican majority’s failure to reach a consensus on the bill in the House, the Senate was unable to take any action. Work continues behind the scenes by the likes of Highfill to prepare legislation that will be approved by all those who support legalization in the state. It appears that most of the pro lobby are from areas where casinos are located.
Over the summer, legislators will be meeting with the gaming association in order to learn more about the intricacies of sports betting legalization and to discuss tax rates. These rates would need to be at a level whereby casinos would still be able to compete with offshore gaming platforms, illegal offerings, and those provided by tribal casinos. None of these currently pay any form of taxation to the state.
Interested parties
Retailers across the state are interested in legalization as it could lead to increased sales in their stores, and professional sports organizations in the state would be interested in receiving so-called ‘integrity fees’ if sports betting is introduced.
Casinos and lotteries will still have their place, with global figures suggesting that almost 70% of all sports betting is conducted through the operations of lotteries. The Iowa Racing and Gaming Commission is currently in charge of oversight of the casino gambling industry, and the lottery is in charge of oversight for the likes of the Powerball, which are multi-state and scratch tickets.
If legalization is approved, casinos would offer a comprehensive sportsbook, while lottery products would be more targeted towards the casual bettor. Early estimates suggest that the state stands to gain in the regions of tens of millions of dollar if this move goes ahead.
The casino industry in Iowa currently contributes over $139m (£118m) in taxes to the state. While sports betting revenues would be significantly less than this, a lot of people in Iowa are actively betting on sports illegally. Widespread legalization and regulations would mean that consumers would be better protected. Currently, people gambling illegally have no guarantee that they will be paid out on a winning bet.
Of course, certain parties in Iowa oppose legalization. For example, Tom Chapman, Iowa’s lobbyist for the Catholic Conference, believes that legalization would only lead to further gambling issues.