Arizona Set to Become Newest State Legalizing Sports Betting

Arizona sports betting 2021

After months of sitting idle, the final vote wasn’t even close. Arizona sports betting bill SB 1797 passed the state Senate on April 12 by a vote of 23-6, two months after effortlessly passing the House. The bill will now head to Gov. Doug Ducey’s desk, where he is expected to sign it into law – Ducey spoke in favor of changing the state’s gambling landscape in a State of the Union address earlier this year.

Ducey also sent out a Tweet shortly after the bill’s passage, saying that the gaming compact is regulated, safe, and “preserves the culture” of the state.

What You Need to Know – The Basics

More than half the states in the nation have now legalized sports betting, with Arizona’s one-sided decision to jump on what is quickly becoming a nationwide trend. Furthermore, Arizona passed its bill with enough support that it can enact emergency authorization to expedite the process to go live.

The state has its sights set on a September launch in order to take advantage of revenue from the upcoming 2021 NFL season. The NFL is the most wagered-on sport in America by a long shot.

State Rep. Jeff Weninger spoke of the potential, saying, “I don’t think we’re talking about in the $10s of millions. We’re talking about in the $100s of millions.”

Somewhat overlooked, the law also legalizes Daily Fantasy Sports (DFS) contests, a big breakthrough after Arizona had been one of the few states in which DFS was expressly illegal.

 Additionally, a new keno game was legalized within the text. There also remains the possibility for the state’s tribal casinos to be able to expand their game offerings beyond just poker and blackjack, as the bill provides a potential opportunity to add other pit games like roulette, craps, and baccarat to create further opportunity for increased revenue.

Sports and Casinos Split the Action

Twenty licenses will be up for grabs and ultimately granted by the state. Half of those licenses will go to Arizona tribal casinos, and the other half reserved for professional sports affiliates. Both groups will be allowed to enter into online partnerships in addition to offering retail wagering on-site.

All four of Arizona’s major sports teams (Arizona Cardinals, Arizona Coyotes, Arizona Diamondbacks, and Phoenix Suns) as well as the PGA TOUR (through TPC Scottsdale) and NASCAR (through Phoenix Raceway) are eligible to partner with sportsbooks and serve bettors both online and at retail locations.  The other four licenses are reserved for horse tracks and future teams/leagues that enter the state.

Meanwhile, the state’s 23 tribes will be left to compete for the other ten licenses. Sixteen of those tribes already operate the state’s 25 casinos, meaning not every casino operator will be granted a license to run a sportsbook.

Tribes Support the Bill

The Democratic side of the bill’s bipartisan support came primarily out of many of the party’s members’ desire to support Arizona’s Native American tribes, which largely support the bill themselves. Sen. Rebecca Rios (D) said of the matter, “This was a negotiation years in the making in which numerous tribal leaders have spoken to my caucus on numerous Zoom meetings to say this is what they want.”

On the other hand, Sen. Sally Ann Gonzales (D) opposed the bill and even went as far as to call it a sham. Gonzales previously served on the council for the Pascua Yaqui Tribe. The tribe is largely in favor of the legislation, which resulted in her accusing the tribe of only supporting legislation after opening a third casino in the Tucson area, giving it another chance at capitalizing on a retail sportsbook.

Aside from the drama, Gov. Ducey’s spokesman C.J. Karamargin weighed in on all parties ultimately coming together: “We’ve worked for years with the tribes on this. This is in everyone’s best interest.”

What’s Next to Come?

Off-reservation casinos are expected to grow in Arizona with the passage of the legislation. Ducey has allowed tribal casinos to expand their operations into metro areas such as Phoenix, where an unspecified number of new casinos will be allowed to open in the future.

Furthermore, the legalization of both sports betting and DFS paves the way for operators such as DraftKings and FanDuel that operate in both realms to take large shares of the Arizona market. However, plenty of competition still exists, and it will ultimately be up to the sports organizations and casino operators as to which partnerships end up coming to fruition.

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