State lawmakers to consider igaming expansion at Florida conference

January 3, 2024 8:59 PM
Photo: A composite created by CDC Gaming Reports from Shutterstock images
  • Buck Wargo, CDC Gaming Reports
January 3, 2024 8:59 PM
  • Buck Wargo, CDC Gaming Reports

The prospect of igaming expansion and regulations needed to oversee it will highlight a gaming conference that convenes state lawmakers from around the country and kicks off Thursday in Fort Lauderdale. About 300 people are expected to attend, including lawmakers and regulators representing 29 states, along with gaming-industry executives.

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A year ago when the National Council of Legislators from Gaming States met in Las Vegas, there was hope that igaming would expand beyond the six states where it’s legal – New Jersey, Pennsylvania, Michigan, Connecticut, Delaware, and West Virginia. Nevada allows online play for poker only and Rhode Island is implementing an internet casino in 2024.

Back then, the expectation was that igaming legislation had a chance in New York, Indiana, Illinois, and Iowa and that it was possible in Maryland, Ohio, Colorado, Louisiana, and Kansas as well.

“No one knows what will happen with igaming in 2024,” said Josh Faber, a senior advisor with Spectrum Gaming Group. “States people looked at last year are dead on arrival, like Indiana and New Hampshire. On the other hand, people are looking at New York, Maryland, Louisiana, and a handful of other states like North Carolina, to see the art of the possible.”

Igaming proponents have faced lawmaker concerns about cannibalizing land-based casinos, costing workers their jobs, and worries about addiction, two points the gaming industry and its supporters claim have been debunked. A third obstacle was that state governments have been flush with cash from the federal government’s response to the pandemic. That could be easing, with more states trying to cover deficits, instead of dealing with surpluses.

Casino-industry consultant Brendan Busssman, managing partner of B Global who’s attending the conference, said there will be some igaming opportunities in 2024, namely New York and Maryland.

“Those are the two best prospects over everything. Igaming is a much different conversation than sports betting, because you don’t turn on ESPN and see the odds. This is a different concept for legislators, who have to make sure they understand the parameters and plan the right tax rate. That may be the biggest problem in Maryland and New York. They may have too high of a tax rate.”

The key to expansion is revenue generation and New York and Maryland fall into that category.

“I’m cautiously optimistic,” Bussmann said. “New York is not an easy state to deal with. Upstate casinos are treated differently than downstate casinos. It’s all been piecemeal, so I don’t know how this latest piece of the jigsaw puzzle fits in. Knowing where they are with the deficit, this can help fill that gap.”

Faber said NCLGS will also announce a major initiative on best practices for igaming legislation, similar to what it did in 2023 for responsible gaming. The issue that many lawmakers will be watching this year is whether igaming can expand, but Faber said NCLGS isn’t pushing that issue. Rather, it’s focusing on guardrails if passed. “I don’t want to call it model legislation, but if states pursue igaming legislation, what kind of consumer protections and responsible gaming safeguards would they need?”

There will be discussions on why igaming has been implemented in some states, but not others, Faber said. They will talk about its effect on land-based casinos and jobs in states where it’s been implemented.

States shouldn’t worry about losing revenue by going to igaming and instead should get more money in the end, which means more jobs, Bussmann said. “It’s that omnichannel experience. ‘I don’t want to drive to the casino tonight, so I’m hopping on my phone for 45 and playing. But I’ll be down there Friday night, because I want to be part of the action. Good operators are achieving that and those who aren’t are the ones against this.”

On Thursday, NCLGS will do a session about daily fantasy sports operators offering games that some call innovative, but others say bear too close a resemblance to sports betting, Faber said. “We’re going to dig deep into it and give it its day in court.”

A panel will survey newer DFS game-types that have grown in popularity since the Supreme Court’s 2018 repeal of a nationwide sports betting ban. It will look into how those companies are disrupting the gaming industry and how the industry is dealing with these companies as some states are licensing them, while other states limit their offerings, Faber said. “We’re going to give daily fantasy people time from their perspective of what’s going on in that vertical. The big question is whether the parlay bet is sports betting or not,” Faber said. “That’s a huge focus to kick off the meeting.”

While many people are focused on sports and igaming, Bussmann said one of the biggest potential state-legislative battles in 2024 is daily fantasy sports, which he says is morphing into unregulated sports betting in some cases, to the chagrin of state lawmakers.

“A lot of states most recently said cease and desist what you’re doing,” Bussmann said. “It’s sports betting and not fantasy. Operators reel back some of their stuff and a bill in Florida and other states amends the DFS law or brings clarity in some states.”

Bussmann said in his home state of Nebraska, it’s illegal, but companies are operating DFS there.

Julie Imanuel Brown, a member of the Florida Gaming Control Commission, will make a keynote speech about what’s happening with Florida sports betting. Other discussions will focus on advertising in sports betting, lotteries, tribal gaming, responsible gaming, and the future of horse racing, including a visit Friday afternoon to Gulfstream Park.

Off-reservation sports betting in Florida will also be discussed as to how that impacts tribal sports betting nationwide, Faber said. There will be an update on the potential for sports betting in Oklahoma. Artificial intelligence adoption and cybersecurity will be discussed at the conference as well.

For the conference agenda, click here.