Although every U.S. State has the ability to legally authorize a variety of forms of gaming, Washington D.C. has always been recognized for having very restrictive gaming laws. Many states have already moved to legalize some type(s) of gaming activities since prohibiting gaming typically causes an increase in underground gaming. Now, it’s time for Washington, D.C. to examine the gaming laws in place. The D.C. Lottery introduced the “GameBetDC” platform in the summer of 2020, and allows residents to make wagers on many international sporting events.
During Washington D.C.’s abbreviated legislative session, which ended on March 13th, the House Appropriations Committee voted 25-7 to move the sports betting measure (HB 2638) forward for a possible full house vote. Sports betting may reach Governor Jay Inslee by Spring if the House votes in favor of HB 2638 and then the Senate votes on similar legislation, SB 6394.
After voting to move the sports-betting measure forward Rep. Strom Peterson stated, “I’m looking to get this out to the Senate fairly quickly. We’ll see how that goes, but I think that the fact that we got a relatively bipartisan vote tonight certainly helped.”
Gambling taxes offer a great way to fund budget deficits caused by the COVID-19 pandemic. With that being said, Republican Senator Curtis King and his Democratic counterpoint, Marko Lilas, filed Senate Bill 5212, which would allow in person and online betting at cardroom locations and racetracks.
If Senate Bill 5212 is successfully implemented through all of the necessary steps to become part of Washington’s gaming law, individuals aged 18 and above will be allowed to participate at brick-and-mortar and online cardroom/racetrack sites. To deliver these types of gambling activities to their clients, operators must first apply for and pay a $100,000 license application fee. Gross gaming earnings will be taxed at a rate of 10%. Also, a licensed gambling facility will have to contract with a third party casino software provider. Those providers must also obtain a Casino Service Industry Enterprise license. Betting on college sporting events occurring in Washington will be disallowed under the terms of the proposed bill.
Predictably, there is no agreement on whether or not cardroom use should be authorized. Tribes in Washington oppose the impending expansion of gaming in the state, citing that the pending legislation would allow mobile gaming throughout the entire state instead of only at Tribal facilities. Card game play is limited to only a few games in non-Tribal gaming establishments. Blackjack, Baccarat, and several types of poker games are among them.
Rebecca George, the executive director of the Washington Indian Gaming Commission said,…this bill would ultimately negatively effect the Tribes and the overall economy of the State. Additionally, it would threaten the 30 years of hard work done by both the State and Tribes to develop a safe and thoughtful regulatory framework for gambling.
Ms. George also noted that Tribal Casinos are an extremely valuable resource for generating income for the Tribes. However, there is a considerable number of supporters for this bill. For instance, Eric Persson, the creator of Maverick Gaming stated that this bill would enable his business to produce an extra $50 million in gaming taxes per annum to state and local governments. Mr. Persson also indicated that he would create an additional 200 job openings in his nineteen (19) existing facilities located throughout Washington. “This produces a lot of family wage jobs …which are greatly needed right now given this pandemic. It creates a tremendous amount of tax revenue …which is greatly needed at both the state level …and even more importantly at the municipal level,” noted Eric Persson. Mr. Persson also showed respect for the Tribes and their rights when he stated that he wouldn’t act on this bill until Tribal Compacts were finalized.
Brenda Wiest was present before the House Appropriation Committee, providing testimony during a public hearing on legislation related to sports gaming. Ms. Wiest is the Vice President of Teamsters Local. She advised the committee that her organization represents the employees working at local card rooms and that she believes it has been too short a time to assess how this proposed expansion of gaming could possibly affect her constituents.
State lawmakers, however seem to agree that any early sports wagering should be restricted to Tribal Casinos. Part of that is based on the fact that those are the only entities in the state where legal wagering has previously been permitted.
Another reason why sports wagering - specifically using mobile technology - poses a danger to children is simply that it could become too accessible. Some of Maverick's statements as it relates to tax revenue produced by the proposal have been disputed by tribal leaders and lobbyists. Tribal leaders/lobbyists have also informed the committee that their reservations are responsible for more than five billion dollars contributed annually to the state's economy, employing more than thirty thousand people in addition to producing more than seven hundred twenty-eight million dollars in state/local tax revenue annually.
David Bean, Chairman of the Puyallup Tribe testified at a public hearing stating,
Native American communities have been "trusted partners" with the state government for more than three decades developing their casinos "with safety, control, and fairness."
Mr. Bean further stated,
The safest, most fair way to insure that sports wagering is conducted safely and honestly is to limit wagering activities to tribal facilities.
Mr. Bean added that,
"The legislation would be beneficial for all citizens of Washington state because tribal gaming provides benefits to both tribal and non-tribal communities. You know us well enough …we live here …we work here …our families reside here …we invest our money here …We urge you to support a sports wagering plan which provides maximum benefits for people and communities in Washington."
Sports wagering has grown dramatically since the United States Supreme Court overturned a 1992 federal law which prohibited wagering on almost all sporting events in nearly all states. Presently, twenty-five (25) states plus Washington D.C. have adopted laws permitting sports wagering, while others are close behind.
Historically, Washington D.C. has enforced very restrictive gaming laws; however, changes are underway. The D.C. Lottery introduced GameBetDC last summer, allowing residents to wager on numerous international sporting events. Various legislative measures have recently emerged in an effort to expand upon existing gaming laws in Washington, which could include allowing in-person and/or online wagering at designated facilities.
Pending the approval of proposed gambling bills (such as Senate Bill 5212) could provide much-needed economic funding to local communities across Washington, particularly due to the continued impact of COVID-19. In addition to providing this potential funding source, pending approval of the above-mentioned legislation would also generate substantial amounts of tax money through increased revenue generated by the operation of various forms of gambling. It is required that each casino/tribal entity pay a licensing fee to operate; this fee will be at least $100,000. Additionally, ten percent of all gaming revenue (gross gaming) will be taxed. Monies collected from taxes on these gaming revenues are then distributed to support both state and local government.
Many are concerned about expanded gambling throughout Washington. Perhaps most concerning are opinions held by tribal representatives who oppose bills proposing mobile gaming outside of Tribal facilities, stating that such action could cause irreparable damage to the careful regulation structure established over thirty years ago. Concerns exist about how easily minors could become addicted to mobile-based sports wagering opportunities as well as disputes over reported estimates made by proponents relating to tax revenue generated by gambling operations.
Tribal representatives advocate for maintaining limits on sports wagering within tribal facilities as they claim such restrictions are essential for maintaining a regulated/gambling environment free from exploitation/abuse. Representatives indicate that tribal casinos have provided financial gains/benefits for both tribal and non-tribal communities alike therefore benefiting all communities equally with regard to their proposed expansion of gaming. Advocates further indicate that they wish to collaborate/coordinate efforts with legislators on passing legislation which honors/maintains their rights/traditions thus creating a positive experience for all parties involved with expanded gaming in Washington.
Eric Persson creator/founder of Maverick Gaming feels confident about the future success/potential of new legislation creating family-wage jobs and increasing gaming tax revenues by approximately fifty million dollars annually. As a result of proposed legislation, Mr. Persson expects to add two hundred new job openings at his nineteen (19) existing locations throughout Washington, creating an estimated 200 new jobs at those locations. "A lot of family wage jobs are needed today due to this pandemic...it produces a huge amount of tax revenue ...the latter is important for both the state level...and far more important — at the municipal level.
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