Legal Sports Betting Hits Major Stumbling Block in Washington DC

With expectations being that the legalization of sports betting in the district of Washington DC is imminent, a major obstacle now needs to be negotiated.

While the bill was on a fast track to approval, the DC Council made the decision at its meeting on January 8 to no longer deem the issue to be an emergency. Therefore, the council has now changed their approach and will proceed as if the bill is a standard piece of legislation that will now need to have its own public hearing.

This will be a blow to those who were looking to capitalize on the district offering sports betting by July.

Background to the bill

The bill, known as the Sports Wagering Lottery Amendment Act of 2018, was on its way to rapid approval. It was introduced only a month ago, on December 4, by Councilman Jack Evans and it quickly went through the council.

Following an 11-2 vote in favor, the bill was given the green light. This was a very quick process as often it can take years for these types of legislation to come to fruition.

A clause within the bill proposes a 10% tax on gross sports betting revenues. There would also be a license fee for the operators entering into the space. The license fee would cost $500,000 for the sporting arenas in the district, with other establishments having to fork out a license fee of $100,000. Discounts would be given to those operators who partner with businesses in the locality.

Sports betting would be legal only in sporting arenas and private establishments such as liquor stores and restaurants. The DC Lottery also would have complete control over mobile sports betting in the district for the foreseeable future.

There was even a clause that would permit the DC Lottery to bypass the license application process. This would allow the lottery to hit the ground running once sports betting became legal and get ahead of the pack.

Mayor Muriel Bowser did not have to stay within the 30-day review period to make a decision, as the bill was an emergency measure and there is no review period in place for such a case. It is completely at the mayor’s discretion as to when a decision would be made.

Recent DC Council meeting

All expectations were that Washington DC was going to open up legal sportsbooks on July 1. It appeared to be only a matter of time before the bill was made into law. Approval by the mayor was the last step before it would be fully assessed. However, Bowser held out on signing it for some time.

In that time frame, an amendment to the bill was proposed. As there was such a small length of time between the proposal of the original bill and passing it, inevitably there would need to be some tweaks and changes.

The amendment mainly concerned doubling the license fee for those looking to operate in the space. It appeared that the meeting of the DC Council on January 8 would be a simple formality. However, the council instead decided that making sports betting legal was no longer a priority.

Why the sudden U-turn?

Whatever happened during the DC Council meeting, the measure was changed from an emergency to being treated as a normal legislative measure. This means that a public hearing on the issue will need to take place.

One of the main issues of contention is the notion of the DC Lottery being given a monopoly to offer legal mobile sports betting in the district. This has gotten a lot of backlash as it might make the scene uncompetitive and not be of value to consumers.

There is no indication as to when such a hearing may take place, but one thing is for sure, the July start date for legal sports betting in Washington DC is no longer a reality.