An Arizona Senate committee on Wednesday tabled a bill to legalize sports betting. This is an important step forward, one that further bolsters the hopes of legal sports betting after Parliament tabled the escort bill days earlier.
The Senate Trade Committee advanced the bill 6: 3 after three hours of testimony, questioning and deliberation. It now goes to the Senate Committee on Funds, which could submit the bill to the entire Senate as early as next month.
Senators peppered officials from the governor's office, professional sports leagues, sports betting operators, and Native American tribes on a wide variety of concerns including: licensing, tax rates, market participation, geofencing technology and revenue generation, and several pieces of the bill's detailed technical language.
Others wondered why some of the licenses allowed under the bill were tied to professional sports teams rather than entering the Arizona market without affiliation. Members of both parties also raised the question of how sports betting, in the context of larger negotiations, encompasses the state's tribal gambling contract. Several said they felt the governor's office had kept them in the dark during the negotiations.
In explaining their votes, only Senator Tony Pace specifically said he opposed sports betting as part of a larger expansion of the games. However, the flood of questions indicated that policy makers had significant concerns about the structure of legal betting.
The other two no-votes were Senator Jamescita Peshlakai, who represents multiple Native American reservations in her district, and Vice-Chairwoman Michelle Ugenti-Rita.
Despite all the problems, the committee continued to develop the bill.
Sports betting supporters are now redoubling efforts to get the house bill forward while continuing to work on fluctuating Senators. The House Commerce Committee passed an accompanying version of the bill last Tuesday, which the House Rules Committee tabled a few days later.
The law cannot be passed by majority vote in both the House of Representatives and the Senate.
This early dynamic, led by a diverse group of stakeholders driving the legislation, has raised hopes that it can pass quickly. However, the lengthy hearing of the Senate committee on Wednesday shows that there are still major concerns going forward.
Senator Rosanna Gabaldon, who voted yes, said she would fully reconsider a possible vote if some of the above concerns were not addressed.
Attention to historical horse races
Even before the vote in the Senate Committee on Wednesday, the supporters of sports betting looked at an independent game bill, which also complicates the statutory betting laws.
The Senate Committee on Funds on Tuesday did not pass a bill that would allow certain horse racing tracks and off-track betting facilities to install thousands of historic horse racing terminals (HHR). HHR players bet on previously held horse races where they can "hinder" races or allow the machine to do so for them, creating a slot machine experience.
The HHR bill comes as the Tribes and Governor Doug Ducey finalize a comprehensive gaming pact that would expand betting options for Tribes and pave the way for legal sports betting, but legalized HHR machines could turn the negotiations upside down.
Anni Foster, the governor's advocate general, confirmed at the hearing on Wednesday that the tribes are waiting for the advancement of other gambling laws before closing the deal.
The sponsor of the HHR bill is Senator David Gowan, former House Speaker and currently Chairman of the Senate Committee on Funds. The invoice for sports betting now goes to the Gowan Appropriations Committee. How he handles the two big game bills could determine the fate of Arizona in legal sports betting.
Sports betting details
The sports betting proposal comes after years of negotiation between Ducey, the tribes, sports betting providers, and professional sports leagues in Arizona. A non-partisan group of Democrats and Ducey's Republican colleagues also support the bill.
If passed, Arizona tribes could open online and retail sports betting. Professional sports venues with at least 15,000 seats, including the Phoenix Raceway and TPC Scottsdale, could also open sports betting.
Certain horse tracks and fraternal organizations may also accept bets.
Ducey's office; Sports betting including DraftKings, BetMGM and FanDuel; the Phoenix Coyotes, PGA Tour, Arizona Diamondbacks; and the tribes have all testified in support of the Sports Betting Act.
Stephen Roe Lewis, governor of the Gila River Indian Nation, said at the hearing on Wednesday that 18 of the state's 22 tribes support the sports betting law as part of the larger pact. However, if the tribes withdraw support due to the HHR Act, the gaming pact is at risk, as is legal sports betting.
The Senate Committee on Funds could include both the HHR and Sports Betting Acts as early as next week. The committee could also postpone further action on either or both of the bills to allow policy makers and gamblers more time to negotiate between competing interests.
In the meantime, the Companion of the Law is moving forward and could get a vote in the coming weeks before the full text. Sports betting supporters remain confident that legal betting can begin in both the House of Representatives and the Senate in the coming months. That, however, largely depends on how lawmakers deal with historic horse racing – and allay certain senators' concerns.
Stakeholders and supporters inside and outside the legislature hope to build support for the Senate, answer the multiple questions asked Wednesday, and get a yes vote for both the House and Senate versions. A lot can change at the Statehouse in the coming months, and Wednesday's vote to uncover legislature concerns over the legal betting framework could dash Arizona's hopes for sports betting for 2021.
Despite these obstacles, Wednesday's marathon committee meeting gives legal sports betting a big boost in Arizona.