Things got a little more interesting last week in the already fascinating world of Tennessee sports betting with a hearing being held in the state where regulations were discussed by sportsbooks and the Sports Wagering Advisory Council (SWAC) who will be taking over as regulators next year.
Back in early summer, Tennessee Governor Bill Lee signed a bill transferring authority of the state’s sports betting operation from the Tennessee Education Lottery Corporation (TELC) over to SWAC, so now that council has the duty to promulgate its proposed set of rules before it takes charge on Jan. 1, 2022.
Last Tuesday’s hearing was an attempt by SWAC to continue its efforts at establishing its own version of the basic set of guidelines that will be followed by sports betting operators and the state in order to best regulate and tax this new revenue flow.
Among the items discussed at the hearing were advertising, responsible gambling rules, and the mandatory 10% hold (the percentage of money that sportsbooks keep for every dollar wagered) that is now in effect, the latter being the main point of contention among operators.
In accordance with the current sports betting legislation now in place, there is a 10% hold rate on an annual basis for sports betting operators in Tennessee, and on Tuesday there were talks about one of the proposed rule changes regarding that hold.
SWAC members have discussed the possibility of reviewing the mandatory 10% hold on a quarterly basis instead of annually, but, according to multiple sportsbooks, that would not be in the best interest of the consumers.
According to Josh Pearl, Penn Interactive Director of Sportsbook Operations, the hold leaves a “lasting, negative impact” on the TN sportsbook market, saying:
…this mandate forces operators to make undesirable business decisions leading to consumer unfairness. The best chance an operator has to meet the 10% hold mandate is to increase the vigorish, also known as the vig, or decrease the payout on parlays and teasers and other wagers offered.
Dean Hestermann, director of issues management and strategic communications at Caesars Sportsbook, agrees with Pearl, saying the hold mandate impacts the Tennessee sportsbook market negatively and is unnecessary.
“Over time and absent the rule governing capped payouts, we would expect the Tennessee market to grow while simultaneously the Tennessee hold percentage would more and more resemble Nevada’s.”
Tuesday’s hearing gave Tennessee’s sports betting major players a chance to have their voices heard but determining whether the mandatory hold continues and finalizing an updated set of sports betting regulations will now be the job of the SWAC.
The SWAC will take over regulations completely at the start of 2022, and at that point the mandatory hold rule could potentially be kept, removed, or set for quarterly review.
The goal of putting the SWAC in charge of Tennessee sports betting is to give the state a more dedicated sports betting council than what the Tennessee Lottery would provide, so most likely it will take the various points made on Tuesday into consideration and create a final set of rules that best reflect the needs of all concerned.
Check back for all the latest news and updates on Tennessee’s ongoing sports betting journey.
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Mike Lukas is a retired standup comedian turned freelance writer now living in Dallas, Texas, originally from Cleveland, Ohio. His love for the game of football and all things Cleveland Browns turned Mike into a pro blogger years ago. Now Mike enjoys writing about all thirty-two NFL teams, hoping to help football gamblers gain a slight edge in their pursuit of the perfect wager. Email: [email protected]More info on Mike Lukas
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