Post Election UpdateTaken from the Grove Report [Chris Grove]
Arkansas [Sports]: Voters approved Issue 4, which authorizes the development of four commercial casinos and allows those facilities to offer on-premises sports betting. Arkansas, by our count, is the 9th state (not counting NY) to which sports betting will expand. Although Arkansas is unlikely to become a Tier 1 sports betting market, we think legalization there is likely to catalyze expansionary efforts in neighboring states, including Louisiana, Missouri and Oklahoma.
Florida [Sports]: Voters approved Amendment 3, which puts future decisions about commercial casino expansion, including sports betting, in the hands of Florida residents. Under the amendment, however, the Seminole Tribe of Florida – which spent millions backing the measure – would be able to offer sports betting via future amendments to its tribal-state gaming compact. We think passage of Amendment 3 all but ensures that the Seminole, which operate six tribal casinos in Florida, will be the first – and, for a time, the only – entity to operate sports betting in the populous Sunshine State.
Louisiana [DFS / Sports]: Voters in 47 of Louisiana’s 64 parishes (counties) approved Act 322, which authorizes DFS. The result paves the way for DraftKings and FanDuel to enter Louisiana, one of a handful of states the two have long avoided for legal reasons. Meanwhile, we note that all seven Louisiana parishes with commercial casinos voted to approve Act 322. We believe that result bodes well for an anticipated casino-industry push for sports betting, which, like DFS, must be authorized via parish-by-parish referenda.
Michigan [Online Casino / Sports]: Michigan Attorney General Bill Schuette, a noted online casino gambling critic, lost his bid to become the state’s 46th governor, while the state’s leading online casino and sports betting proponent, Rep. Brandt Iden, retained his seat by the narrowest of margins. We think those results, at very least, will keep a path to online casino and sports betting expansion open in Michigan; whether those results will accelerate or slow a rumored lame-duck push for such expansion, however, remain unclear.
Nevada [Online Casino / Sports]: Nevada Attorney General Adam Laxalt, who has previously expressed opposition to online casino gambling, lost his gubernatorial bid. We think the result removes a potential threat not only to the state’s diminutive online poker industry, but also to efforts by some Las Vegas casinos to reform its mobile sports betting industry.
New York [Online Casino / Sports]: The flip of the state Senate is likely a negative for online gambling - already an uphill climb in the Empire State. Stakeholders are also expressing concern that the change in power may hinder attempts to get mobile sports betting across the finish line.
Illinois [Online Casino / Sports / DFS]: Illinois gubernatorial candidate J.B. Pritzker, who has expressed support for sports betting legalization, bested incumbent Gov. Bruce Rauner. For us, the result raises two key questions: Will Pritzker, a Democrat, have a less adversarial relationship with the state’s most influential pol, Democratic House Speaker Mike Madigan, than his predecessor? And could such a relationship (finally) grease the rails for a long-debated and massive expansion of gambling that would include, among others, online casino, sports betting, and DFS?
Federal [Sports]: The Democrats won control of the House of Representatives. If Rep. Frank Pallone of New Jersey, as expected, becomes chair of the House Energy and Commerce Committee, we wonder whether the de facto committee of origin for federal sports betting regulatory legislation – given both Pallone’s recent decision to withdraw his federal sports betting regulatory bill, and his recent remarks questioning the need for such bills – will be the House Judiciary Committee.
Rep. Jerrold Nadler of New York, who is in line to chair Judiciary, has not yet taken a position on the need for federal sports betting regulation. But will Nadler be swayed by three of his powerful constituents – the Manhattan-headquartered NFL, NBA and MLB – all of which have expressed support for such regulation?