An unepxected vote to move Arizona sports betting legislation forward is set for Monday.
For more than a month, AZ sports betting legislation sat idle in the Senate. Now, the bills legalizing daily fantasy sports and sports betting in Arizona gets its chance.
Senators will likely hold an up or down vote on the legislation Monday. Sen. T.J. Shope believes he has the two-thirds vote to approve either HB 2772 or his SB 1797, though it appears SB 1797 was withdrawn Thursday from the Senate Appropriations Committee.
“It would allow the Governor to sign immediately, maybe as soon as Tuesday,” Shope told LSR Thursday. “They would need to get approval from Bureau of Indian Affairs, but that’s almost a formality.”
AZ sports betting gets the hockey assist
Shope tweeted that former Arizona Coyotes captain Shane Doan helped move the needle:
I’d like to thank “Captain Coyote”, Shane Doan, for stopping by the State Senate yesterday to give me a hand in moving SB1797/HB2772 (Fantasy Sports Betting; Event Wagering) forward to an up-or-down vote! Stay tuned because there’s big news to come on this front! pic.twitter.com/trunIt69WX
— T.J. Shope (@TJShopeforAZ) April 8, 2021
Arizona sports betting Senate logjam
The House voted to pass HB 2772, 48-12, on March 4. That was after the Senate Appropriations Committee had merged the Shope-sponsored sister bill with a more divisive historic horse racing bill.
Some believe the Senate’s merging of its sports betting bill and an HHR bill would violate the previous 2002 gaming agreement with tribes. The potential “poison pill” aspect of the HRR bill kept it an unlikely proposition.
Shope said the logjam was cleared Wednesday, after working with Appropriations Chair Sen. David Gowan to strip out the HHR bill.
“He’s been trying to do some good things helping the horsemen and race tracks,” Shope said. “He’s trying to make sure there’s a revenue stream that Arizona can tap into, I respected that.
“We were able to break that through. HHR is not a part of it, but there are some funds that are part of it that go to that industry.”
Now the Senate can either pass the House version or adopt an amendment to make the Senate bill the same. Rep. Jeff Weninger sponsored legislation in the House and was a vocal proponent throughout its journey.
Governor support is there
The AZ sports betting legislation would help enact a new gaming compact between Gov. Doug Ducey and the state’s gaming tribes.
Throughout earlier House committee hearings, tribal leaders spoke on behalf of the legislation.
In the bill, 10 sports betting licenses are tied to professional sports teams. Another 10 would go to the state’s gaming tribes.
How it would help compact
According to Ducey’s General Counsel Anni Foster, the new compact would:
- Modernize the compact
- Maintain the current culture of gaming
- Increase revenue
During his State of the State address in January, Ducey said he wants legalized sports betting in AZ.
Dissenting votes are expected, Shope said, particularly from a block of legislators who are members of the Church of Jesus Christ of Latter-Day Saints. He also expects at least one Democratic Senator to vote no.
Sports betting a key piece of the compact
With one of the goals of the new compact being to increase revenue, lobbyists played up the potential of an estimated $42 million in annual taxes.
Compass Strategies managing partner Kelsey Lundy told the House Commerce Committee on March 9 an estimated $3 billion a year is bet illegally in Arizona.
Arizona would levy an 8% tax on fantasy sports revenue, with license holders paying a fee to be determined by the Arizona Department of Gaming.
The state would levy a minimum of 8% on sports wagering. The legislative fiscal note includes an estimated $154.4 million in taxable operator revenue when the market matures, resulting in $12.3 million in taxes. Annual fee revenue is estimated to be $4.1 million.
Sportsbook support for the bill
Lundy spoke to the committee on behalf of BetMGM, DraftKings, and FanDuel. She also stressed Arizona is one of six states without legalized fantasy sports.
Representatives from the Coyotes, Arizona Diamondbacks, Phoenix Suns, PGA Tour and Phoenix Raceway all supported the bill at various committees.
Some opponents worry about data security while others feel restaurants, bars, and other retailers will miss out on revenue by not being included.
“It’s one of those things where everybody is happy in many respects and not in other respects,” Shope said. “But at the end of the day, it helps Arizona.”