30-second summary
- Washington, DC, has been trying to legalize sports betting for some time
- Under the new bill, the DC Lottery will be the sole operator
- Mayor Bowser has signed the bill and there will be a public hearing on January 28
- It will now go to the US Congress for consideration for 60 days
Background to the bill
The Sports Wagering Lottery Amendment Act of 2018 was introduced on December 4 by Councilman Jack Evans. The City Council quickly approved it by an 11-2 vote. Under this bill, there would be a tax of 10% on gross sports betting revenues.
Those who want to play host to sportsbooks will also have to pay a license fee for the privilege. Sports arenas in the district will have to pay a license fee of $500,000 (£379,000). Other types of establishments will pay a license fee of about $100,000 (£75,800).
Any operators that work alongside other local businesses will get a discount on the license fee. Only sporting venues and some private establishments like restaurants and liquor stores will be able to offer sports betting.
Sole operator
The only operator of sportsbooks in the district will be the DC Lottery, which will not have to go through the application process to set up a sportsbook under this bill.
Mayor Muriel Bowser was expected to sign this bill quickly. However, she did not have to sign within the usual 30-day period. Because the bill was passed as an emergency measure, there was no set period for the review. Therefore, it was at the discretion of Mayor Bowser as to when or if she signed the bill.
The sports betting bill hit a snag at a DC Council meeting on January 8. The original plan was for sportsbooks to be open by July 1, but an amendment was made to the bill while the Mayor deliberated on the issue.
The amendment altered the license fees. It is not unusual to see this type of amendment due to the short period of time in which the bill was passed. At this meeting, the council decided to no longer make sports betting legalization a priority.
There has not been any indication as to why the Council made this decision. It is now seen as a normal legislative measure, so a public hearing is required. Some oppose having the DC Lottery as the sole operator of sports betting. This monopoly would likely lead to a lack of competition and less value to the end customer.
Mayor signs the bill
Mayor Bowser finally put pen to paper on the sports betting bill on January 23, 2019. It will now go to the US Congress for a customary 60-day review period before it officially becomes law.
The bill would allow mobile and online betting. A major meeting on the issue on January 28 will discuss whether or not online sports betting will only be allowed in the exclusivity zone of the sporting arenas.
This hearing is open to the public. If there is no competitive bidding process, sports betting would be brought to market a lot quicker than it otherwise would.
The American Gaming Association (AGA) has its headquarters in Washington, DC. The organization is not overly happy with the latest developments with having a sole operator without a competitive bidding process.
In December, the AGA made a statement on the issue: “While the vote today [Dec. 18] is progress, we remain deeply concerned about giving the lottery a virtual monopoly in the mobile market. Predictably, this will result in less investment and innovation, to the detriment of consumers and the ability of a nascent legal marketplace to compete with the accessibility and convenience offered by many established illegal wagering operations.”