Arizona Sports Betting Moves Further Forward with New Bill Advancing

• A new proposal with amendments will be reviewed & voted upon in next stage this week
• Gov. Ducey endorses sports wagering, hoping to secure new commitment with AZ tribes
• Historic horse racing bill needs to be resolved to not delay sports wagering bill progress

Like a long football drive down the field, sports wagering legislation in Arizona is advancing into “the red zone” toward potential passage soon.

In its most recent stage, sports betting continued its march through the Arizona House this week, when the Rules Committee approved a bill 6-2, with amendments. House Bill 2772 now head to the House floor in its next stage for a vote and to receive approval.

The requested amendments were necessary upon changes from previous proposals. The Arizona Rules Committee has listened to other requests, but this opportunity helped move this stage toward a vote. In this new version it included application fees and taxes applied for both the sports wagering and daily fantasy sports (DFS) sectors.

The Senate companion bill, SB 1797, is set for a hearing in the Appropriations Committee on Wednesday after being delayed by the Senate Commerce Committee last week.

Amendments to the bill were also made in the House Commerce Committee involving language and technical changes. One involved moving the approval time for sports wagering application from 30 to 60 days. Another change involved potential for allowing more than 10 licenses for Native American tribal casinos. Also allowing for those tribal casinos to offer off-reservation mobile wagering.

Full Support of Arizona Governor

There seems to be no barrier from any governmental level as Governor Doug Ducey (R) has pledged his full support. He said the compact, which regulates and governs tribal casinos involving their relationship with the Arizona government has been agreed to in principle. They would fit under the definition of Class III gaming and the tribe’s business-like commercial sportsbooks operating would be regulated by the Department of Gaming.

Gov. Ducey has promoted the new bill as part of the overall gaming compact negotiations. He has projected legalized sports wagering to produce approximately $42 million in tax revenue for the state along with new job opportunities.

The issue of taxation for the tribes is yet to be resolved under the new proposed agreement. Usually federally recognized Native American tribes do not have a defined tax rate. The amount is usually defined in a revenue-sharing agreement according to their state compact.

Next Steps for Arizona

The delay for Arizona sports wagering legalization might involve a matter pertaining to resolving a gaming issue regarding historic horse racing.

An Arizona Senate committee is scheduled to consider a bill allowing HHR (historic horse racing) terminals at state horse racing tracks. These are the terminals that allow players to bet on previously conducted horse races and operate like slot machines.  They are known as large profit-makers for all casinos and racetracks that have them in operation.

Sen. David Gowan(R), the former Arizona House Speaker is heading the HHR proposal and chairs the Appropriations Committee. A first vote on the issue is scheduled this week.

Although the bill has the backing of the state’s horse racing industry, it is extremely opposed by all Arizona Native American Tribes. The tribes believe expanding slot opportunity options would threaten their business.

It is possible the HHR bill might have to be sacrificed for Gov. Ducey to secure the tribes cooperation to move the larger priority of sports wagering legislation ahead.

Not surprisingly, officials from top sportsbook operators including DraftKings, FanDuel, and BetMGM are anxiously waiting to partner with Arizona casinos and begin affiliations with all Arizona professional sports teams.

No hearings have been scheduled yet for HB 2772 to be heard on the floor. The Arizona Legislature adjourns for the year on April 24.

Once past these major final hurdles, it could be clear sailing for Arizona to begin preparing for sports wagering sometime within the coming months in 2021.