for early access to the latest igaming videos!
and get the latest igaming news first!
Hawaii has hit another significant milestone in its quest for legal sports betting, as Senate Bill 1569 advanced on Tuesday (Jan 4). This bill would create a regulated sports gaming market in the state and is second to go forward in this legislative session.
SB 1569 also has a house companion, HB 1308, which was also advanced by the House Economic Development and Technology Committee on Friday (Jan 31). While the committees in both chambers unanimously moved the bill, there was strong opposition, which indicates a tough ride ahead for the sports betting cause.
A Well Rounded Hearing
The bill was advanced by the Senate Economic Development and Technology Committee, which spent around 30 minutes discussing it. James Kunane Tokioka, Director of the Department of Business, Economic Development and Tourism (DBEDT), was the first speaker and highlighted that none of the 39 states, including Washington DC, where sports betting was legal, use an economic development agency to regulate sports betting.
He further warned that his department might not be the best to regulate a sports betting market, and even if they were to push forward, several issues needed to be clarified, including funding sources, organization structure, usage of tax revenue, and further license requirements.
Next to testify was David Williams, a deputy attorney general with the criminal justice division. He clearly stated that his department is against the bill due to “the risk of adverse financial effects on Hawaii citizens.”
Williams also referenced studies indicating that legalized gambling has led to increased bankruptcy rates, negative impacts on families, and even domestic violence, particularly among the most economically vulnerable households.
Several government agencies and trade organizations voiced their support for the bill, including David Bautista, a spokesperson for the Hawaii Iron Workers Stabilization Fund.
He pointed out that 67,000 people left Hawaii between 2021 and 2022 due to poor living conditions and limited job opportunities. Bautista also noted that an additional 180,000 residents are considering leaving, emphasizing that the bill could generate revenue to fund initiatives aimed at improving these conditions.
Senator Donna Mercado Kim expressed her support for the bill but raised concerns about the idea of using gaming revenues to improve living conditions. Estimates suggest that a regulated sports betting market could generate around $37 million for the state, but Kim believes this amount may not be sufficient to create a meaningful impact.
“For me, it’s not necessarily the money, but to stop the illegal wagering, to make it safe so people know that they can do it and not have their fingers cut off if they don’t pay or whatever,” she said. “And if there is revenue from it out there, then fine. But I just don’t want people to think this is panacea. Because sports betting doesn’t generate that much revenue coming out of it.”
Industry Players Present
The hearing also heard testimonies from DraftKings, represented by Rebecca London, and BetMGM, represented by Jeremy Lion. Both were unsurprisingly in support of the bill, highlighting the potential economic benefits of regulated sports betting and how it has helped the fight against illegal operators in other jurisdictions.
Boyd Gaming, operator of Vacations Hawaii, did oppose the bill, which came as no surprise, seeing as their business arranges vacation trips from Hawaii to Las Vegas.
What Does SB 1569 Say?
The new bill limits the number of operators in the state to only four, and they all have to pay an initial $250,000 licensing fee. Licenses would also have to be renewed annually and would cost $250,000, too.
The proposal did not specify a tax rate, but it included the creation of a problem gambling prevention and treatment fund that would receive an undisclosed percentage of the tax revenue. Players would also be allowed to fund their accounts with credit cards, a move that has been banned in at least three states.
The bill has to crossover to another chamber before March 6. Also, the Hauwaii legislative session for the year will end on May 2.
Source: iGamingBusiness
