Arkansas Racing Commission Approves Mobile Sports Betting Through State Casinos; Legislative Council approval as the next step

The Arkansas Racing Commission on Thursday unanimously approved changes to the state’s gambling rules that allow mobile sports betting through local casinos, including granting 51% of income to established casinos when working with online bookmakers.

The rule changes now have to be approved by the Arkansas Legislative Council, due to meet on January 28th.

“It has not yet been decided whether this item will be on the agenda for January,” said Racing Commission spokesman Scott Hardin after the meeting. “If ALC agrees, the rule changes that enable mobile sports betting would take effect immediately.”

The committee meeting, which included a public hearing on the matter, lasted over two hours. Eight people, including representatives from casinos in the state and a sports betting company, spoke to the commission.

The Racing Commission had received about 800 letters and emails from the public, with most of the sports betting total being disputed, Racing Commission attorney Byron Freeland told commissioners.

The 51% split between established and licensed casinos sets Arkansas apart from the rest of the nation, where the average percentage at local casinos is 5-15%.

John Burris of Capitol Advisors Group – who represents online sports betting companies DraftKings Inc., FanDuel Inc., BetMGM, Fanatics and Bally’s – said they were excited when it was announced that sports betting was allowed in Arkansas.

“We think it’s a great opportunity. I think if I had a point it would be that we are not against them. We are sports betting and they are the three state casinos, ”said Burris. “I think that perception has evolved, but it really isn’t. We see it as an opportunity to bring revenue to a market through the casinos and a player who is generally not regulated and used.”

Still, Burris asked the commissioners to change the rule to allow sports betting companies to negotiate the split directly with the casinos, with the casinos in full control of whether or not to “accept or decline” the offer.

“We ask the rule and the government not to place restrictions that prevent this from being an open and competitive marketplace,” said Burris.

[RELATED: See complete Democrat-Gazette coverage of casinos in Arkansas at arkansasonline.com/casinos]

In a December 21 letter to the Racing Commission, Wayne Smith, general manager of Oaklawn Racing and Casino Resort said that outside of state sports betting providers generally require them to receive 85 to 95% of net sales, with only That leaves 5 to 15% of the net income to the local casinos.

“We doubt that in such circumstances this is really compatible with the intent of Amendment 100, which restricts casino gaming and accepts sports betting to the four (4) licensed casinos that are more directly regulated by the Arkansas Racing Commission,” said Smith . “If the third-party operator keeps 85 to 95% of the net income, who really does the sports betting?”

Smith added in the letter that the ultimate goal of many sports betting providers outside of the state is to create a confidential customer database for sports betting as well as other types of betting.

“And in some cases, to get these customers to visit casino properties in other states where tax revenue and other economic benefits would be driven by other states rather than Arkansas,” said Smith.

Andrew Winchell, director of government affairs for online bookmaker FanDuel, said a 51% split would hamper the ability to offer “premium deals” to Arkansas players, eliminating most of the top branded operators.

Carlton Saffa, Saracen Casino’s chief market officer, told the commission that fee structures are enshrined in several gambling laws across the state and that existing Arkansas casinos already have profit-sharing agreements with other games such as slot machines that account for approximately 80% of the profits to the casino.

The commission did not touch another rule that sports betting providers also questioned: the restriction of each casino licensee to the provision of no more than two individually branded online sports platforms – or “skins” – and accompanying mobile applications with the approval of the racing commission.

Each individually branded online sports pool platform / mobile application provided by an online sports pool operator-agent must prominently display the name of the casino license it is associated with on its website, in accordance with the rule changes.

The state’s casinos – Saracen Casino Resort in Pine Bluff, Southland Casino Racing in West Memphis, Oaklawn Racing Casino Resort in Hot Springs, and the recently licensed Legends Resort and Casino in Pope County – got the green light to offer on-site sports betting in 2019.

The new rule allows mobile wagering anywhere in the state as long as it is physically located within state lines and conducted in collaboration with a current gaming license holder.

Online sports betting is defined in the Rules as the process of placing bets on sporting events over the Internet on websites or mobile applications using computers, mobile devices or other approved interactive devices that are accepted through a gaming system approved by the Racing Committee.

As of July 2019, sports gamers have wagered around $ 96 million at the three casinos, resulting in more than $ 83 million in payouts and about $ 1.74 million in government revenue, according to the state Treasury and Administration Department.