Federal Government Approves Legal Arizona Sports Betting

Arizona State Flag and an Arizona Casino

The United States Department of the Interior approved on Monday an updated tribal gaming compact agreed upon last month by Gov. Doug Ducey and the state’s tribal leaders, paving way for the legalization of Arizona sports betting and online fantasy sports betting.

Said Gov. Ducey in a statement:

“Gaming creates thousands of jobs for Arizonans, it generates tax revenue that benefits key areas of our communities, and it draws visitors to our state. The tribal-state gaming compact amendment, along with its associated legislation, was the culmination of a multi-year process and I was proud to work with all the stakeholders on this historic accomplishment. The tribal-state gaming compact and its associated legislation now is officially in effect — thank you to everyone who worked to make this happen!”

Legal Gambling on Professional Sports

The approval of the Department of Interior’s Bureau of Indian Affairs was the last step in the legalization of Arizona sports betting. Professional teams will need to acquire state-issued licenses and set up their sports wagering operations. Backers of legal Arizona sports betting hope that everything will be ready in time for the start of the 2021 NFL season.

Under the deal, major professional sports groups will be able to offer legal Arizona sports betting on professional sports leagues like the NFL, NBA, MLB, and NHL. Online fantasy sports operators like DraftKings and FanDuel can “piggyback” on the approved licenses.

The deal also allows the tribes to expand their casino gambling options by adding games like craps and baccarat or increasing the number of slot machines in their properties.

Partnerships Have Started

Since the Governor and the tribes signed the new agreement, partnerships between sports organizations and sports betting companies have started. Earlier this month, the Arizona Diamondbacks and Caesars Entertainment announced a partnership to build a retail sportsbook in the plaza adjacent to Chase Field.

The NBA’s Phoenix Suns have also announced that the organization will partner with FanDuel to bring legal Arizona sportsbetting to the Phoenix Suns Arena via a retail sportsbook. The Suns say that the 6,300 square foot sportsbook is expected to be ready for the 2021-22 NBA season.

Likewise, the TPC Scottsdale which is the home of the Waste Management Phoenix Open golf tournament, revealed that it will be partnering with DraftKings to construct a sportsbook at the facility. TPC Scottsdale describe the project as a “19th hole experience” where fans can place bets all-year round.

Gov. Ned Lamont and Mohegan Tribe Agree to Expand Gaming in Connecticut

Two Laptops Showing Sports in Front of a Pile of Money
The state of Connecticut has reached an agreement with the Mohegan Tribe, the owners of the Mohegan Sun Casino in Ucansville, Connecticut, to expand gaming in the state, including online gaming and sports betting. The deal however, was made without the state’s other tribal nation.

In a written statement, Governor Lamont said:

“This agreement represents months of hard work and dedication to getting a deal that’s best for the residents of Connecticut and moves our state forward when it comes to the future of gaming. We are incredibly fortunate to have such a devoted partner in these efforts like the Mohegan Tribe, as they have been open to negotiation, honest discussion, and a positive path forward that is beneficial for both their tribe and the State of Connecticut.”

The governor’s office says that the deal is worth “tens of millions” of additional revenue to the state. Lamont is banking that iGaming and Connecticut sports betting will be legalized this year. He already included $47M in revenue from the two into his budget starting in fiscal 2022.

Details of Connecticut Sports Betting Agreement

Under the deal, a 20% tax rate will be levied on new online gaming while a 13.5% tax rate will be imposed on Connecticut sports betting. The agreement is good for 10 years and has a five-year expansion option.

As part of the deal, the Connecticut Lottery will be allowed to operate 15 retail sports betting shops, including new ones in Hartford and Bridgeport. The Lottery can also sub-license some of the operations to Sportech but Sportech will not get operations or an online skin of its own.

Eastern Connecticut Lawmakers Upset

Meanwhile, the members of the Eastern Connecticut said that the “cannot accept” any gambling expansion agreement reached by Gov. Ned Lamont and the Mohegan Tribe if it does not include the Mashantucket Pequot Tribal Nation. The bipartisan group sent a letter to the Governor urging him and the state’s two federally recognized tribes to complete an agreement by Sunday.

Rodney Butler, the chair of the Mashantucket Pequots said on Tuesday that it was “disrespectful” for the Governor to announce a gambling agreement with only one tribe when the Mashantucket Pequots have been actively participating in the discussions for months and in good faith. Butler however said that his group is open to continuing the discussions but has a financial issue with the deal.

Sports Betting Proposal Advances in Arizona House Panel

Arizona State Flag and an Arizona Casino
An Arizona House panel advanced a proposal that would permit legal betting on professional and collegiate sports at tribal casinos and venues owned by professional sports teams after hearing from the tribes and teams that back the deal that Gov Doug Ducey made with the tribes.

The proposal, authored by Rep. Jeff Weninger, would allow professional sports teams and tribes with existing casinos to conduct legal Arizona sports betting operations. It would also allow fantasy sports betting from online operators, new sports betting at horse racing tracks and selling of Keno tickets by groups like the VFW.

8% of the non-tribal legal Arizona sports betting profits will go to the state’s general fund while taxes from a maximum of 8% on tribal gaming revenues will go to the local governments and special state accounts. It is estimated that legal Arizona sports betting could bring in as much as $42M per year in additional state revenue.

Backed by Arizona Pro Sports Teams

Representatives for Arizona’s professional sports teams are backing the measure. Under Weninger’s proposal, teams like the Arizona Diamondbacks would be allowed to have sportsbooks inside and near their venues. Weninger’s initiative is also backed up by the major tribes in Arizona as it would allow them to add more table games while also operate sports betting facilities.

According to Arizona Diamondbacks representative Amilyn Pierce, teams in areas with legal sports betting bring in extra revenues that hurt the competitiveness of Arizona’s pro sports teams. Pierce said without legal Arizona sports betting, the state’s sports teams are at a disadvantage in a competitive market.

Small Businesses Are Being Left Out

Associations representing bars aren’t too thrilled with the proposal. Arizona’s bars, which were hit very hard by the pandemic, are complaining that they are being left out new opportunities, including new Keno games and fantasy sports betting. They argue that big operators will get more revenues from legal Arizona sports betting while bars are either closed or operating at limited capacity.

Democratic Rep. Diego Espinoza and eight other house members agree. Although the group voted for Weninger’s bill, they said that they want to see the bars and restaurants included in the measure, and that they may not back the bill in the full House if these small business are omitted.