Louisiana sports betting update
Legal Developments

Where The Louisiana Sports Betting Bill Goes From Here

The Louisiana Senate easily passed a sports betting ballot measure bill Wednesday, giving better odds than ever that state voters will be able to approve legal wagering within their home parishes as part of this fall’s elections.

Clearly a major positive step for sports betting backers, there are still many hurdles before Louisiana residents and guests can place a bet from their phones – or even a casino.

The Louisiana House still needs to pass an identical version of the ballot measure bill, a hurdle on the legislative journey that has tripped up sports betting legislation each of the past two years. As of Thursday afternoon, the House bill wasn’t on its Friday calendar, but lawmakers will likely take it up next week if not on May 15th. The 2020 legislative session ends June 1.

Then, assuming Gov. John Bel Edwards approves of the bill, it is still subject to the will of voters; theoretically, all 64 parishes could reject sports betting.

Should at least one parish, and likely far more, approve the measure, the real challenges begin. The Senate bill passed this week only details the simple yes-no question on the Nov. 3 ballot. Lawmakers will still have to enact further legislation outlining licensing, regulation and taxation sometime in the 2021 session.

During that process, legislators would also have to decide to exclusively permit sports betting at casinos and horse tracks within parishes that voted for legal sports betting, or if they’ll take on the more legislatively challenging push to allow full mobile wagering in any locality that voted to approve it. In theory, lawmakers could also allow wagering at any or all of the hundreds of video poker machines in Louisiana parishes that approved the measure.

Aside from regulatory control, which will be under the Louisiana Gaming Control Board and not the state lottery, nearly every aspect of Louisiana sports betting remains undetermined, including the very question of legalization.

House Vote Still to Come

A few hours after the Senate passed the sports betting ballot measure, a House committee updated its incarnation of the bill to align with the Senate version. The committee then moved to align the House bill with the Senate bill and pass it to the full House floor without opposition.

This is a clear positive, and ensures the bill already has a solid floor of supporters. That may not be enough for the whole floor.

Despite the proliferation of video poker terminals, casinos and state lottery retailers in Louisiana the past few decades, organized gambling still remains controversial. Conservative religious and political groups still have strong influence on the legislature, and a subsection of lawmakers remain opposed to any new form of gambling; eight of the 37 voting senators Wednesday voted against the mere ballot measure to allow sports betting.

The wide range of gaming entities could also be a problem. A House substitute amendment that expanded sports betting from casinos to video poker terminals helped kill legislation last year, as many lawmakers opposed what they considered too large a gaming expansion. Video poker backers are circulating more bills this session already, and could very well hope to include their interests on the sports betting ballot measure.

An amendment that mandates video poker games be included on the ballot measure could push away wavering gaming backers and once again kill a sports betting bill. Even if that modified legislation manages to pass the legislature, a ballot measure that guarantees video poker terminals the right to offer sports bets could turn off voters who could tolerate sportsbooks in casinos would resist the betting options at the terminals, which are far more accessible to the general public.

2020 Ballot Question Details

If both chambers of the Republican-controlled legislature pass the bill, it goes to the desk of Edwards, a Democrat who has largely supported gaming in the state and seems inclined to support such a measure.

In that case, the following question would appear on the ballots of all Louisiana voters ahead of the Nov. 3 election:

“Shall sports wagering activities and operations be permitted in the parish of ___________? YES ( ) NO ( )”

The straightforward text of this question, backers hope, will garner the support of most members of the public, which has increasingly shown support for legal wagering in nationwide polls. The majority of parishes, including all the ten most populated, supported a similar yes-no ballot question to legalize daily fantasy games in 2018.

“I know that sports wagering is a very sensitive issue for a lot of folks, which is why we put it in this format here” Sen. Cameron Henry, the bill’s sponsor, told his colleagues before Wednesday’s floor vote. “On Nov. 3rd, around 10 o’clock when the polls close and all everything’s been submitted, you will be able to look at the results of what your constituents want you to do as it relates to sports wagering moving forward. It is the safest way to get this done.”

Though sports gambling may carry a larger stigma, it’s not a stretch to expect similar support from those DFS voters two years later. At a macro level, voters during presidential election years tend to be younger and less conservative than in the midterm electorate, two demographic trends that would seem to favor sports betting approval.

Still, a vote of the public is never a sure bet.

Voters in the first two states with sports betting ballot measures passed, including by a solid margin in neighboring Arkansas. But in Colorado, voters only just narrowly passed sports betting, although that can partially be attributed to unusual wording of the measure.

Campaign dollars can help sway voters to the “yes” camp, as was the case in Arkansas, but could also go the other way. If conservative interest groups – or gaming interest that fear being left out of sports betting – inundate Louisianans against the proposition, sports betting could run into trouble across many of the state’s parishes.

Future Bill Awaits in 2021

If at least one parish passes the referendum, then the most difficult work begins.

Lawmakers will have to pass a bill laying out, among other key factors, licensing requirements, regulatory structures and tax rates. Requirements for sports betting bills in every state, Louisiana lawmakers haven’t been able to find common ground in either of the past two legislative sessions on all these criteria.

Many of those same lawmakers haven’t even agreed on DFS regulations. Eighteen months after voters in the majority of parishes authorized daily fantasy games, lawmakers have still not agreed to the tax rate and regulatory structure necessary for operators to start accepting players. Sports betting, which is usually far more politically contentious, could suffer a similar fate.

And that doesn’t include the key question over access.

Online Sports Betting in Louisiana

Sports betting backers in legislature have been motivated by Louisiana residents going to retail sportsbooks in Arkansas and more so Mississippi, which took its first legal bets in August 2018. The core argument has been to give Louisiana casinos and horse tracks the same options as their neighbors, a pitch which has, more or less, been fairly amenable to most state elected officials as they seek ways to keep would-be tax revenues from crossing state lines.

The larger issue has been who else can take bets. The video poker lottery operators still want in on sports betting; their revenue has declined roughly 3.5% in the past decade and owners are hopeful the option to take sports bets could help turn the tide.

But for some elected officials, further expanding gaming options at the state’s 2,000 or so video poker terminals is a bridge too far. In 2019, video poker was added to the sports betting bill designed for casinos, and in the process sunk the entire legislation, especially after the casino lobby pulled its support after the terminals were given sports wagering access.

Lawmakers will also have to consider an even broader expansion – mobile wagering in every parish that approves the referendum. For gaming opponents, the thought of sports gambling from home or a mobile device in much of the state is a non-starter.

For advocates, especially those who tout sports betting as a revenue generator, mobile is essential. In more mature markets, mobile wagering makes up close to 90% of all handle. Confining betting to the state’s brick-and-mortar casino and horse tracks – and even the video poker terminals as well – means the government would garner just a fraction of possible mobile tax revenue.

These core issues stopped Louisiana sports betting each of the past two years. They will remain an issue in 2021 – assuming Louisiana can finalize the ballot measure for 2020.

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