South Dakota Lawmakers Happy to Support Illegal Sports Betting

South Dakota lawmakers had a chance. They could have pushed forward legislation to allow online sports betting in the state, attracting hundreds of millions of dollars and offering consumers better protections. Instead, they decided offshore sports betting is perfectly fine, and shot down the legislation last week.

South Dakota Continues Living in the Past

After passing the South Dakota Senate, the House State Affairs Committee on Friday morning killed Senate Joint Resolution 502 (SR 502). This constitutional amendment would have allowed online sports wagers.

The measure’s supporters claim South Dakota is losing millions in revenue by continuing to ban online sports betting, which is legal in many other states, including Iowa and Wyoming.

Kristi Noem’s administration and social conservative organizations such as Family Heritage Alliance spoke during the discussion of SR502, emphasizing the problems that gambling raises. They refused to point out, however, that these problems already exist in the state or that no evidence exists that legalized gambling in any other state has led to an increase in issues.

David Wiest, deputy revenue secretary, argued that when voters approved sports betting in South Dakota in 2020, they did not expect it to happen outside of Deadwood. Now, allowing it anywhere else would only serve to benefit sportsbooks, not the state, he asserted. He failed to highlight the fact that the measure passed in 2020 by a vote of 239,620 to 170,191. That’s enough of a gap (58.47% to 41.53%) to give South Dakotans the opportunity to vote if online sports betting should be allowed.

House Committee Balks

Despite South Dakota-based betting companies, such as Dakota Gaming Group’s BETKOTA, supporting the resolution, 10 of the 13 House State Affairs Committee members did not.

Proponents are disappointed with the results, but they won’t give up. If the Legislature doesn’t embrace online sports betting, a citizen-led initiative is likely to be a necessity.

Senator Kyle Schoenfish, who called Weist’s statements “misleading,” asserted, “We need to be honest and acknowledge the vote today did nothing to stop any type of gambling going on today or in the future, as South Dakotans can quickly and easily place their wagers online or in neighboring states.”

GeoComply Shows South Dakotans Want Online Sportsbooks

GeoComply’s data shows that more than 6,700 attempts were made in South Dakota to place bets on the Super Bowl. GeoComply provides technology to online betting sites to ensure legal markets are open to all players.

GeoComply is the primary cybersecurity provider in the industry. It provides technology to online betting sites to ensure that bettors are legally in place before any wager is accepted. Nearly 70% of those who were blocked from South Dakota during the Super Bowl period were from people trying to access Iowa sportsbooks.

That likely means that 70% of potential South Dakota sports bettors ultimately sent their money to offshore sites, which means no revenue for the state and no consumer protection if something goes wrong.