Rhode Island Latest State to Consider Online Lottery and Sports Betting

Lawmakers in Rhode Island have made two major moves over the last month that would significantly expand residents’ gaming options if successful. First, Governor Gina Raimondo included revenue earned from sports betting in the recently-introduced state budget.

Just weeks later, Representative Charlene Lima introduced legislation authorizing the Rhode Island State Lottery Commission to begin selling lottery tickets and virtual scratch cards online. According to high-end estimates, both activities could contribute a combined $48.5 million in additional revenues to state coffers.

Both initiatives have significant hurdles to clear if they are to become the law of the land, but it’s clear Rhode Island is becoming ever more comfortable with gambling expansion. Having the governor on board with sports betting should also increase the odds of gambling-friendly legislation getting the go-ahead from lawmakers.

Here’s a quick recap of what happened last month in Rhode Island.

Rhode Island Sports Betting

Governor Raimondo’s decision to include revenue from sports betting in the state budget last month was a surprise considering Rhode Island doesn’t even have legal sports betting. The brief plan found in the budget would allow residents to bet on sports at Twin River’s existing Lincoln casino and proposed Tiverton casino.

However, the plan is contingent upon the Supreme Court overturning the federal sports betting prohibition when it issues a ruling in New Jersey’s challenge of the ban. That ruling is expected to come down sometime this summer.

As Legal Sports report explains, Rhode Island would still need to pass legislation legalizing sports betting to implement Raimondo’s plan – and that is only if the Supreme Court rules in favor of New Jersey.

Raimondo’s plan does not include online sports betting in Rhode Island, but the Providence Journal reports lawmakers are looking at that issue as well. Legalizing online betting would require a public referendum. If that referendum were to pass, lawmakers could then draft up a plan to regulate sports betting conducted over the internet.

Online Lottery Sales to Shore Up State Pension Fund

Rhode Island is also looking at legalizing online ticket sales. Rep. Charlene Lima introduced H7437 to authorize sales of lottery tickets and scratch cards via mobile apps and over the internet for residents age 18 or older. The bill calls for geolocation verification to limit sales to Rhode Island residents, a voluntary self-exclusion program and daily, weekly and monthly spending limits.

In a statement published Wednesday, Rep. Lima listed budgetary concerns as a primary motive for introducing online ticket sales. She estimates that taking the lottery online could help Rhode Island raise anywhere from $13 million to $25 million per year in new revenues for the cash-strapped state.

It is time to explore alternate means of revenue rather than always placing the burden on taxpayers. Additionally, it is time that Rhode Island make an honest effort to reduce its unfunded pension liability and make our retirees and pensioners whole as promised,” she said in the statement.

Her move will likely be just one of many measures considered as lawmakers look for ways to close the growing gap between the value of the state’s pension fund and what the state has promised to state workers and teachers. In December, the Providence Journal reported that the state’s unfunded liability has climbed to $5.33 billion.

Rhode Island has actually made some progress in addressing the pension shortfall, but recent projections estimate that the pension will be fully funded in 2038. However, adding lottery revenues to the investment fund could significantly shorten that timeframe.

Rep. Lima’s statement explains that the legislation would call for 50% of all revenue generated by online lottery sales to be “dedicated solely to our unfunded pension liability and help get this pension fund to the 80% level we promised our retirees and pensioners.” The other half would go to the general fund or be earmarked for other purposes by the legislature.