The Tennessee Education Lottery Corporation won’t be approving new regulations for the sports betting sector anytime soon due to concerns raised by two lawmakers.
concerns raised by the lawmakers will be discussed at the meeting
These rules were originally drafted back in November. A letter sent by the Senate Speaker and Lieutenant Governor Randy McNally and House Speaker Cameron Sexton requested a delay in the approval of these regulations. This letter was sent to Susan Lanigan, chairwoman of the Tennessee Education Lottery Corporation.
This means that a vote that was set to take place on Wednesday will not take place. Instead, concerns raised by the lawmakers will be discussed at the meeting.
Areas of concern
A key area of concern was a rule that would see a tied game that was part of a parlay bet leading the total bet being a loser. In most cases, a sportsbook operator will rule out this selection in a parlay bet but allow the remainder of the bet to continue with one less selection.
The other major issue relates to sports betting operators needing to have a hold of at least 15% at all times. Such a cap could see the state lose as much as $11m in revenue, according to a study. This cap is a far greater than what is in place in other states that have legalized sports betting.
Concerns of a legal nature
Sexton and McNally also have concerns relating to the draft regulations that were approved in 2019 not being within the scope of the law.
The Tennessee Sports Gaming Act allegedly does not provide the proper level of authority for the Board of Council for the creation of certain rules. The letter sent by the lawmakers states:
Specifically, the Sports Pool Intermediary License and the Vendor License, and associated fees, are not authorized in the Act.”
The road to legal sports betting
The main standout aspect of the Tennessee approach to legal sports betting is that only online sportsbooks can receive a license. The number of these licenses that can be issued has not been capped, but there will be a fee of $750,000 that has to be paid each year to hold such a license.
There would be a 20% tax rate on revenues and there would be a mandatory requirement for online sportsbooks to purchase official major league data when creating odds for its markets.