Flutie To Phelan
Lawmakers continue to tinker with Minnesota's sports betting bill in an attempt to placate all sides, but will the Hail Mary attempt work?
The Bulletin Board
NEWS: Minnesota’s sports betting bill keeps changing, but its chances to pass aren’t improving.
BEYOND the HEADLINE: A request is granted, but support still doesn’t exist.
LEGISLATIVE UPDATES: the fate of DFS 2.0 in Colorado; Regulatory changes in Kentucky; Ohio to live stream study commission hearings.
NEWS: New Jersey gambling numbers highlight the financial benefits of online gambling, but can it change hearts and minds on cannibalization and jobs?
QUICK HITTER: Georgia’s sports betting bill runs into a roadblock.
AROUND the WATERCOOLER: How many North Carolinians plan to bet?
STRAY THOUGHTS: If you can hit one target, you can hit them all.
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A Look at Minnesota’s Amended Sports Betting Bill
Minnesota’s sports betting bill has undergone two major revisions in the last few weeks.
SF 1949 was amended a couple of weeks ago to prohibit in-game wagers, making Minnesota the first state to contemplate only offering pre-game wagers. Another amendment requires bettors to set limits at registration.
Rep. Pat Garofolo called the in-game wagering change a poison pill.
“Having that provision in there would not allow a regulated sports gambling market to exist in Minnesota,” Garofolo said. “It’s a poison pill— well-intentioned, I’m sure, by the advocates, but it would really be prohibitive.”
Last week, the bill was amended further, with the tax rate doubling from 10% to 20% and some changes to the distribution of tax revenues collected, including uncapping the amount racetracks could receive.
Changes of this sort happen when desperation sets in. A similar situation is taking place in Maryland, where an online casino bill keeps changing in the hopes of garnering support.
This is similar to North Carolina’s online casino efforts in 2023 and what I call the Kitchen Sink approach, which rarely works:
“The kitchen sink approach is a common occurrence in states struggling to gain enough support for a gambling expansion. The theory is you can add another expansion that opponents of your effort agree with to bring them on board… So you gain a few votes and lose a few votes. And then, in a desperation hail-mary attempt, you try adding another expansion (and maybe another), and the same scenario plays out. You keep adding and adding until no one supports it.”
Maryland and Minnesota aren’t so much adding things to gain support; they’re tinkering. They’re putting band-aids on legislation that needs medical intervention to try to make everyone happy, which almost always makes no one happy (as you’ll see in the Beyond the Headline section below).
Beyond the Headline: If it Makes You Happy
Per Minnesota Bets, bill sponsor Matt Klein said the in-play prohibition was a request from Finance Committee Chair John Marty. In the very next sentence, Minnesota Bets reports, “Klein also conceded that representatives for the potential Minnesota sportsbooks and the tribal casino operators that would partner with them… would oppose such restrictions.”
And the change didn’t even accomplish its intended goal, as Sen. Marty took to the opinion page of the Minnesota Star-Tribune after the changes were made:
“As chair of the Senate Finance Committee, I don’t see legalized sports betting as a big revenue source for the state. I see the reality we face: huge additional cost to taxpayers to address mental health and addiction problems, especially in young people… We need major changes in the proposals before they are ready for serious consideration.”
Legislative Updates: DFS 2.0 in CO; Georgia Sports Betting; Regulatory Changes in KY
DFS 2.0’s fate in Colorado: Colorado’s Committee on Legal Services will weigh in on DFS 2.0 games on Thursday. The Committee is expected to decide if DFS 2.0 needs to be peer-to-peer, as the Colorado Division of Gaming ruled in January, or if the vs.-the-house format is acceptable.
KHRC changes in Kentucky: The Kentucky Horse Racing Commission, which oversees horse racing and sports betting in the state, is currently under the purview of the Governor’s office. That would change if a bill passed by the Senate last week becomes law. Under the bill (SB 3), oversight of the KHRC would shift to the Commissioner of Agriculture. Proponents say the change would give the KHRC more independence and require Senate approval for commission appointments.
Ohio Study Commission visibility: Ohio Rep. Jay Edwards, one of the chairs of the state’s Study Commission on the Future of Gaming in Ohio, has revealed that future meetings, as well as a transcript of the first meeting, will be available on a soon-to-be-created site. The goal is to provide better visibility of what the Commission is discussing.
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NJ Numbers Won’t Help the Cannibalization Debate
In the most recent Talking Shop Podcast (listen here), I discussed Atlantic City and the impact online gambling is having on the market with longtime Atlantic City reporter David Danzis.
One of the core topics Danzis and I discussed was the difficulty of determining whether online gambling has been beneficial or detrimental to the market.
Right on cue, the New Jersey gambling numbers were released on Friday, with the AP titling its column: New Jersey: Internet gambling revenue continues to soar; in-person revenue? Not so much.
Per the AP, “only three of the casinos individually won more in person this February than they did in February 2019.”
This is a thread that Danzis has kept a close eye on.
“Only three of AC’s nine casinos generated more revenue in 2023 than they did before COVID-19 upended the industry nearly four years ago,” Danzis wrote in a recent article on the potential fallout of New York City casinos.
Danzis also notes that overall casino employment is down 25% over that time. Yes, shrinking land-based revenues are likely partly to blame, but it’s also likely to be a byproduct of the pandemic when casinos learned to automate certain services and streamline staffing.
Still, while online gambling and sports betting are setting records in New Jersey, land-based revenue is stagnant at best.
As I said in my cannibalization-themed feature column on Friday:
“This is the often-overlooked point in the cannibalization debate. Most land-based markets are mature, with established pecking orders and fragile ecosystems. When you introduce something as significant as online casinos, the ecosystem and pecking order will change. Not everyone will benefit, and many casinos fear they will be on the losing end.”
And is it any wonder why organized labor in other locales opposes online gambling? As Wynn CEO Craig Billings’ said in a LinkedIn post that sparked my Friday column, “They’re not going to pore over analyst reports on cannibalization to form an opinion on the topic.”
What they notice is ‘online growing; land-based shrinking.’ The why never enters the equation.
Quick Hitter: Georgia Sports Betting on the Ropes
A hearing in the Georgia House Higher Education Committee tackled SR 579, a bill that seeks to legalize sports betting via a constitutional amendment. The Senate passed SR 579 in late February.
The hearing was contentious, and while no vote was taken, the pushback the bill received indicates a deep resistance to expanded gambling in the Georgia House.
Georgia is also missing the catalyst to legalize sports betting. Gambling expansion often comes down to money, and as Jill Dorson reports, “Multiple lawmakers also noted that the state has a $16bn budget surplus and isn’t in a hurry for new revenue streams.”
The committee will meet again on Wednesday, but it’s unclear if the sports betting bill will be discussed. The legislature is set to adjourn on March 28.
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Around the Watercooler
Social media conversations, rumors, and gossip.
With so much attention focused on illegal markets and the need for consumer protections, it’s always intriguing to see how many people actually care about betting. Judging by the poll results below, less than 10% of adults have strong feelings about legal betting.
You can find the full poll results here.
Stray Thoughts
One of the things I try to relay to some of my younger martial arts students is consistency + accuracy = success. Always have a target; don’t punch to punch (or simply go for speed and power). Strive for accuracy, which comes from good technique and begets speed and power.
I often use archery as an analogy. You aim for the bullseye, but if you ask a high-level archer to hit the top corner of the target, they can do it, even though they likely never practice hitting it. If you can hit the center every time, you can hit anywhere you want.