Sports betting could finally be expanded in Washington in 2021. (Getty Images)
With so many wants and needs for Washington’s economic future, the state continues to plot its strategy out of the pandemic with new revenue-generating proposals. That includes a sure to be litigated capital gains tax, a proposed wealth tax, and a bill to bring in money through an expansion of sports betting.
COVID, Dem co-sponsor give bid to expand gambling in WA new life
On Thursday, leaders from several local cities, including Kirkland, Burien, and Tukwila will urge lawmakers in Olympia to pass the latter of those three bills, SB 5212, at an 8 a.m. public hearing of the Senate Committee on Labor, Commerce & Tribal Affairs.
A bipartisan group of lawmakers from the state House sent a letter to a Senate panel explaining the bill on Tuesday. The bill would allow on-site sports betting in existing licensed, privately-owned cardrooms and racetracks.
In the letter, they argued that it constitutes “a solid representation of the priorities identified by the 2021 Legislature for economic recovery from the pandemic and critical equity goals,” and that with so many difficult choices facing lawmakers and few opportunities, it’s “one such positive choice we can make to help restore our economy that also helps working families.”
A similar effort failed to pass in 2020 in the form of SB 5212, championed by Nevada-based Maverick Gaming owner Eric Persson. He tried, unsuccessfully, to convince state lawmakers at the time that the state could benefit from tax dollars the expansion would produce. While Persson is trying to do the same this year, there are a few things that have changed since last time.
“The coronavirus impacted not just the state of Washington, but the entire world and we think that that $100 million in potential tax revenue is very salient. It’s very salient for Olympia, I think it’ll go towards a lot of good in this state,” said Persson.
The odds were stacked against Persson’s effort last year, especially with it coming so soon after the U.S. Supreme Court decision that cleared the way for legalized sports betting outside of Nevada. But things are different now, as Persson and his team have worked with city and state leaders about what this bill would and would not do, and the benefits it could have for the state both long and short term.
“We have a lot of momentum, and we’re just going to keep pushing forward and we’re going to keep working in the state. We’re going to keep being a great partner and we’re going to keep pushing for sports,” he said.
More Democrats are open to the idea this time around too, with Senate Democratic Floor Leader Marko Liias co-sponsoring.
“The amount of support we’ve gained through both the Olympia awareness as well as the statewide awareness is growing exponentially. You know, it’s no secret — we submitted a bill (last year) and ultimately, we weren’t successful. But in the time since, we’ve been continuing to work with a lot of local mayors, a lot of the representation, we partner with Teamsters 117, we think we’re going to have a broader support from labor,” said Persson.
“We are the largest private party to partner with the Teamsters in the state of Washington,” he added, a feat he’s not shy about saying makes him proud.
Part of the reason for growing support among policy makers and labor alike is the way Maverick takes care of its workers, including good paying jobs.
“We have over 2,000 team members making an average salary above $75,000,” he said, noting many more of those jobs would be created should the bill pass.
“They’re providing a lot of jobs and so for myself, personally, because I’ve been working in the casino industry for over 20 years, people don’t realize they are actually very good jobs,” explained Jackie Franco. who is now a leader with the Teamsters 117 union.
“I was a single mom, and it was able to provide me with a good steady income and support myself and my son comfortably and I own my own home and never had to struggle financially,” she added.
As a union leader she also wants to keep that going for all workers, including the many new jobs that would be created should the bill pass – jobs that she says couldn’t come at a better time.
“It’s important to get this through to protect jobs, and especially now that they are union jobs, they were jobs where we made good money before, but now we have medical, they’re providing a pension, medical is more accessible. Even though I’ve been in the industry for a long time, the previous owners had a requirement of hours that was almost impossible to meet, and with Eric coming on, and Maverick, they’ve made it a lot more accessible,” she said, pointing out that they now only need 30 hours to qualify for benefits, making most of the company’s workers eligible.
“I wish that we would have been union 20 years ago and had a pension plan. I mean, how awesome is that? Man, if we would have had this 20 years ago, I’d be set. So I’m definitely excited to provide that for not just those of us that are already in the casino industry, but for the future,” she said.
As a kid from Hoquiam, nothing would please Persson more than being able to help lift his hometown state out of the economic devastation the pandemic has caused.
“I love the state of Washington and I love Maverick Gaming, and I believe that what we have is an opportunity to give what constituents want across the state and do a lot of good in a lot of different ways,” explained Persson.
“100 million bucks is 100 million bucks — it can go towards so many different things and in this time in this environment, it’s needed,” he added.
Here’s what he expects will happen should SB 5212 pass.
“What it is we’re proposing (is) a couple different things. One is $100,000 site license per licensee — there’s 45 cardrooms in the state, that’d be four and a half million bucks,” he explained.
“And then on top of it, it ends up being a 20% tax rate, or 10% is going to the state and 10% is going to the local constituents and or local cities,” he continued. “And that’s estimated to be around $100 million a biennium, so around $50 million a year.”
Some of the concerns that got in the way of the proposal last year included allowing online mobile betting, but that part of the bill has been removed this time, taking online sports betting off the table for the time being.
The language in this version caps sports betting to only the existing card rooms in the state, addressing concerns that this could lead to more of them opening.
As for potential risk for problem gambling:
“We’re market leaders in the state of Washington and at this point that’s unquestioned, so for example, we’ve created a data self-exclusion database. So if you come into one of our card rooms, and you’ve identified or we’ve identified you as having an issue, you are not able to come to any of our card rooms,” he explained, adding they hope the Native American tribes will join with them in that regard.
Should Washington state allow sports betting?
“We hope the Native Americans properties will opt into our database so that when someone self excludes from any casino or card room in the state of Washington, they won’t be able to just venue-shop and continue their issue. We know that is less than 2% of the population, but still, that’s 2% of the people who end up having an issue and so we want to be responsible.”
Maverick donated nearly $200,000 to the Problem Gaming Commission this year, which Persson says is likely the largest donation they’ve ever made.
“We’re committed on this cause — like for the 98% of the customers come in, they spend about 50 bucks, we’re the ‘Cheers’ bar and they’re there to socialize, and to talk to the dealers and talk to their friends. But for the people who it is an issue for, we want them to get help, we want them to be responsible, and so from our perspective, having a statewide self-exclusion policy would be a win-win,” Persson stressed.
He’s optimistic, as is Franco.
“I think that there’s a good chance. Hopefully the legislators will be more open, especially with the state needing the revenue. I think that they’ve heard the voices of the people saying, we want to retain our jobs, we want to keep these businesses open, we want to make sure that even the ones that aren’t working right now, have a job to come back to whenever the whole COVID thing gets better, whether it’s in three months, six months, a year,” she said.
Should the bill be approved, the new law would not kick in until after the current government compact agreements are worked out with the tribes who got the right to allow sports betting in a bill passed last session.
Highlights of the bill:
- Only existing licensed cardrooms and racetracks would be eligible for a sports betting license.
- Each license (each facility must have its own license) would be charged a $100,000 licensing fee to fully cover the cost of a robust regulatory system focused on public safety and integrity.
- A state-level 10% tax would be imposed on the operators on all gross revenues from sports wagers. This tax would be in addition to the taxes already levied at the local level.
SB 5212 does not allow:
- Betting on collegiate sports events that take place in Washington State or that involve a Washington state team and take place outside of the state.
- Betting on electronic sports, high school sports, and competitive video games.
- Betting by anyone under the age of 18.
- Any change or impact that would threaten tribal sports betting, and licenses for commercial cardrooms would not be granted before the first tribal compact for sports betting is complete.
Thursday’s hearing is at 8 a.m. in the Senate Committee on Labor, Commerce & Tribal Affairs. You can sign up to weigh in as late as 7 a.m. here.
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