Arizona Gambling Expansion Bill Passes House Commerce Committee

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Governor Doug Ducey of Arizona has been successful in negotiating a gambling expansion bill with tribal operators to include private operators and professional sports teams. The bill legalizing the process passed the House Commerce Committee on Tuesday.

Expanded Sports Gambling Coming to Arizona

Arizona continues its push for legalized betting on professional and collegiate events with a bill progressing during a House Commerce Committee hearing on Tuesday.

The Bill backed by Rep. Jeff Weninger makes it so that tribal casinos and websites owned by professional athletic teams would be running the show, with Gov. Doug Ducey securing support from tribal operators who are historically opposed to commoditizing sports betting beyond their control.

Effectively, the bill seeks to allow existing casinos to add a sports betting product, with professional teams such as the Arizona Diamondbacks, hosting their own betting operations as well. Furthermore, the legislation seeks to introduce betting at horse race tracks as well as expand to daily fantasy sports (DFS).

Think of the Little Guy

Yet, not everyone is content with the proposal. Bars and taverns that rely on gaming revenue to make up for the worst of the economic downturn brought on by the pandemic have argued that the bill cuts them out of new fantasy contests and Keno games, that could boost revenue.

According to Arizona Licensed Beverage Association president David Delos, who spoke in front of the House Committee yesterday, “big players” were the ones to benefit while small businesses got left behind. With reduced capacity looming for the foreseeable future, Delos fears that establishments such as bars will have to shut down, adding to the financial and economic woes of the state.

Lawmakers passed the bill, despite Delos’ concerns, but not without specifying that additional support may indeed be necessary for bars, and possibly restaurants. Rep. Diego Espinoza was among those voting for the bill but endorsing Delos’ position.

Rep. Pamela Powers Hannley, though, voted against the measure, explaining that data privacy could become an issue, and not least so the actual costs of problem gambling. Hannley minced no words, calling gambling an addiction right away, and explaining that people lose their livelihoods over the activity.

“I think we need to realize that we could have unintended consequences from an expansion of gambling.”

-Arizona Rep. Pamela Powers Hannley

Appeasing the Tribal Operators

Meanwhile the governor has remained fairly low-key about the deal that has been negotiated with the tribes, with the original compacts expiring in 2022. However, Anni Foster, Ducey’s lawyer, has been able to negotiate a new off-reservation gambling deal, making progress for the state, tribes and private operators.

Yet, success did not come overnight. In fact, the governor had been working for several years prior to table agreement with the tribes. While elsewhere tribes have proven a tough nut to crack, Arizona’s governor has been apparently able to bring them on board.

Sports teams have welcomed the news that they would be able to operate their own sportsbooks, including Arizona Diamondbacks’s Amilyn Pierce who said that the state could not afford to fall behind in terms of competitiveness in the sports betting industry, and therefore action was needed.

The state is preparing to tax both tribal gaming profits and non-tribal gambling profits by 8% and lobbyists for daily fantasy companies in the state say that they expect over $42 million in revenue for the state a year. Briefly last year, there was a push to see an expanding gambling deal emerge, but the plans were finally shelved for the 2021 legislative session.

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