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After signaling he would not veto the sports betting measure if it came to his desk, Tennessee Governor Bill Lee kept his promise and allowed online sports betting without a signature.
The Governor did not sign the online wagering bill but allowed it to pass without a veto, creating a scenario that allows sports betting to occur as early as July 1st of this year.
In a statement, Gov. Lee outlined his objections to the expansion of sports betting but also detailed why he would allow the bill to become law.
“I do not believe the expansion of gambling through online sports betting is in the best interest of our state,” Gov. Lee wrote.
“But I appreciate the General Assembly’s efforts to remove brick and mortar establishments.”
“This bill ultimately did not pursue casinos, the most harmful form of gambling, which I believe prey on poverty and encourage criminal activity.”
Gov. Lee further stated that he was only comfortable allowing sports betting to occur online only in Tennessee.
“Compromise is a central part of governing, but I remain philosophically opposed to gambling and will not be lending my signature to support this cause,” he wrote.
“We see this issue differently but let me be clear: any future efforts to expand gambling or introduce casinos in Tennessee will assure my veto.”
Keeping casinos away from sports betting in Tennessee will be easy as there are currently no operating casinos within the state’s boundaries.
The bill calls for operators to pay a $750,000 annual fee and have all revenue taxed at 20%.
The bill will become official on July 1st. On that date, the state’s Lottery commission will start their preparations in drafting regulations for bettors and operators alike.
The most eye-popping for betting experts is that Tennessee is the first state that will force operators to use the sports leagues official data.
This stipulation will likely result in professional leagues such as MLB, NBA, and NFL getting an integrity fee from all bets placed on their sport.
The official data mandate also turns power over to the leagues to restrict what type of bets operators in Tennessee will be able to take.
For example, this amendment might inhibit in-game betting and proposition bets that gamblers love to play due to their long odds and variance.
Integrity fees have become a hot-button topic in states like Ohio, who are currently debating a sports betting bill.
Experts have spoken out against integrity fees with Eric Schippers of Penn National Gaming calling the fees a “shakedown.”
“There was never any opposition from the leagues to say, hey, we need a piece of that or we want to add on top of that,” Schippers said.
“You just go buy your data,” he continued.
“So the notion of official league data now includes putting a vig, if you will in the gaming vernacular, on top of what we should already buy through these two services.”
With Tennessee becoming the first state to bend the knee to the professional leagues, the tables are set for other states wanting to legalize to expect pressure to follow suit.
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