Road to legalization

Washington DC has been quick to pass legislation to legalize sports betting, since the end of the federal ban in May 2018.

The Sports Wagering Lottery Amendment Act 2018 was introduced on December 4, 2018 by Councilman Jack Evans. It got approval from the DC Council following a vote of 11-2 in favor of the bill. Such a step usually takes months in many US states, but it was only a matter of weeks in the capital.

Mayor Muriel Bowser put pen to paper on the bill on January 22. This was followed by a 60-day review period, which is required due to it having a fiscal impact.

The DC Lottery is the regulator of this new sector. It is the sole provider of sports betting in the district, something that has been a point of contention. Many believe there should be a competitive market for different operators, rather than a monopoly situation.

The regulator has selected Intralot as the operator of the region’s sports betting offerings. It will be able to offer mobile sports betting across the region. The only places where sports betting can be offered are private establishments such as bars and restaurants, as well as at sporting arenas.

This bill introduces a 10% tax on the sportsbooks’ gross revenues.

Sporting arenas in on the action

The Capital One Arena, which plays host to the Washington Capitals NHL team and the Washington Wizards NBA team, will have sports betting. Current plans are for an old restaurant in the facility to be transformed into a sports betting lounge. MGM Resorts is the official gaming partner of both the NBA and the NHL.

There are four facilities in the district that are immune to the Intralot monopoly. These are the St. Elizabeths East Entertainment and Sports Arena, Nationals Park, Audi Field and the Capital One Arena. Therefore, they will be able to enter into their own partnerships with sportsbook operators.

The four must each pay a license fee of $250,000, with the license lasting for five years. There is also going to be a two-block radius exclusivity zone whereby there can be no competition.

When sports betting kicks into place in Washington DC, it will be the first area that does not have casinos that offer sports betting.

Sports betting on the horizon

One of the last issues to be resolved is that of geolocation. National park property and federal buildings are not part of the local jurisdiction. The regulator therefore needs to have an advanced geolocation service in place that can exclude those areas.

There are 55 federal buildings and 19 national parks within the city limits, making geolocation a very tricky proposition. This compares with New Jersey, which simply allows mobile sports betting once the person is within state lines when they are playing.

A further problem is Audi Field and Nationals Park are only two blocks from one another, which breaches the exclusivity zone rule.

These issues will need to be resolved in the coming months. Hopes are that the final regulations for sports betting will come at some stage during the summer. The aim is to have sportsbooks open by the time the 2019 NFL season begins.