There will be Tennessee online sports betting.
On Tuesday, the Tennessee Legislature approved the country’s first interactive-only sports betting bill. Senate Bill 16 passed on a vote of 19 to 12 and by a vote of 58 to 37 in the House. Tennessee is not a “gaming state” in that it only has a lottery and no casinos, and Governor Bill Lee is generally opposed to gambling, but he will allow the bill to become law without his signature.
“The governor has said he does not believe that the expansion of gambling is best, but he recognizes that many in the legislature found this to be an issue they want to explore further,” Lee’s Press Secretary Laine Arnold told the Tennessean. “He plans to let this become law without his signature.”
“No one saw this coming”
As you may be aware, Tennessee is home to RotoGrinders’ headquarters. Co-Founder and CEO Cal Spears is happy his state became the ninth to legalize sports betting in the U.S., and he’s also surprised it happened so quickly.
“Right after the PASPA decision, I was on record saying that Tennessee would be one of the last states to pass sports betting,” said Spears. “We are a very conservative, anti-gambling state with no casinos. One of my lobbyist friends that worked on the DFS bill here in Tennessee told me that there was a pretty clear path to legalization through the lottery, though. He was right but I’m still shocked that Tennessee will be one of the first states with mobile sports betting. No one saw this coming.”
Other central U.S. gaming states such as Illinois, Kansas and Missouri began examining legal sports betting last year, but have yet to pass a bill getting the job done. And Tennessee emerged as a kind of dark horse.
Mobile wagering brings in the revenue
The bill is the first of its kind in the United States in that it only allows for mobile/online sports wagering with no connection to casinos, or partnership between sportsbook operators and casinos required. Because there are none, obviously. Of course, bettors will have to be physically present in Tennessee to place a wager.
The legislature discussed brick-and-mortar locations or standalone kiosks, but ultimately went the route they did. Many bettors do like the experience of physically being in a sportsbook, especially for major events like March Madness and the Super Bowl, however Tennessee simply doesn’t have that infrastructure right now and will become the first state to begin creating a legal, digital sportsbook environment to compete with the illegal market and bring in tax revenue for the state, alongside consumer protections for Tennesseans. Virginia considered such a framework earlier this year before the legislative session concluded in March.
Having interactive-only sports betting isn’t likely to hurt Tennessee much from a revenue standpoint. In New Jersey, mobile wagering has accounted for more than 80 percent of the total sports betting handle for three consecutive months since the start of 2019.
When the state lottery, which will regulate TN sports betting, rolls out regulations and licenses operators, the state will join Nevada, Delaware, New Jersey, Mississippi, West Virginia, New Mexico, Pennsylvania and Rhode Island, which currently have sportsbooks legalizing sports wagering. However, only Nevada and New Jersey offer legal online wagering at this time. Pennsylvania’s market is expected to come online in the next few weeks or months.
As Spears points out, it’s not just “mobile” sports betting. Bettors can make a wager on their phones or on the internet, creating an opportunity for companies like RotoGrinders.
“Note that it’s not mobile only – it’s interactive, meaning bets are only placed over the internet,” said Spears. “Most of those will be place on mobile devices, of course. The bill is great for RotoGrinders because it allows the convenience of remote, online registration. This allows sites like ours to be paid referral fees for sending players to reputable online sportsbooks.”
The future is now in Tennessee
The timetable for the rollout of legal sportsbooks in the state is as yet undetermined , but the process of crafting rules and regulations will be able to begin soon. The legislation has a July 1 effective date.
When can Tennesseans expect to be able to make legal bets? Based on the experience in other states, a realistic but optimistic scenario would be in time for Super Bowl LIV on Feb. 2, 2020. But it may be be closer to March Madness.
Tax revenue from sports betting is projected to bring in an estimated $50 million each year. The money will be used for education, local government and gambling addiction treatment.
“I’m thrilled with the Senate, House and Governors’ progressive outlook on regulated sports betting,” said Cameron MacMillan, Co-Founder and COO of RotoGrinders. “I was honestly tempering expectations. I’m impressed with not only how quickly the bill moved through, but also how innovative and entrepreneurially focused the Tennessee elected-officials were by enacting a mobile framework.”
“Betting will take place in this state with or without this bill, but now it’s regulated, which will be a huge benefit to the Tennessee tax budget. RotoGrinders, SharpSide and US Bets can’t wait to grow our sports betting content offerings for the millions of passionate sports fans across the state. The future is now!”