Wisconsin Online Sports Betting Legislation Advances, But Questions Remain

• Two pieces of Wisconsin online sports betting legislation have advanced out of their originating committees
• SB 592 and AB 601 have both been approved by committees, but operators and tribes disagree on bill
• Sports betting operators believe legislation is not economically viable as written

Two Wisconsin online sports betting bills have been moved quickly out of committee, but key figures in the state’s potential sports betting market are at odds with how legalization should occur.

Sen. Howard L. Marklein’s bill (R-17), SB 592, and Rep. Tyler August’s bill (R-31), AB 601, both seek to legalize Wisconsin online sports betting for state tribes through a hub-and-spoke system and have seen early support from legislators.

Despite both being moved out of their initial committees on their first votes, questions remain regarding the central legalization method and potential revenue sharing models between tribes and sports betting operators.

Both Bills Move Forward

The Wisconsin Senate Committee on Agriculture and Revenue earlier this month approved Marklein’s bill by a 5-3 vote in an executive session meeting. The closed-doors meeting was held on Thursday, Nov. 6, two days after the committee held a public hearing on the bill.

The bill is currently open for scheduling and has yet to be assigned to a new committee

August’s Assembly bill moved unanimously out of the Committee on State Affairs by a 10-0 unanimous vote. The legislation was forwarded to the Committee on Rules and will have its next hearing on Wednesday, Nov. 19, at 1 p.m. CST.

Both pieces of legislation are similar and will legalize online sports betting for federally recognized Wisconsin tribes. The bills will allow tribes to renegotiate their gaming compacts – which also must be approved by the federal government – to offer online sports betting through their own platforms or through partnerships with sports betting companies.

Tribes will be able to partner with sports betting companies, such as FanDuel or DraftKings, to offer their online sports betting platforms to users in the state. Tribes will have to include the partners in their renegotiated gaming compacts.

However, while all parties involved hope to legalize online sports betting for Wisconsin tribes, the framework of the bill is disagreed upon by several essential groups.

Will Operators Want to Enter Market?

Due to the bills legalizing Wisconsin online sports betting through the Indian Gaming Regulatory Act – similar to how the Seminole Tribe in Florida legalized online sports betting – sports betting operators will be required to provide tribes with at least 60% of their revenues.

During a public hearing for SB 592, Damon Stewart, counsel for the Sports Betting Alliance, reported if Wisconsin legalizes online sports betting through IGRA and the proposed hub-and-spoke model, the market will not be economically viable for operators to enter.

The Sports Betting Alliance represents the interests of bet365, BetMGM, DraftKings, Fanatics Sportsbook, and FanDuel, several of the largest sports betting companies in the world. If legalized under this framework, Stewart said the SBA members will not enter Wisconsin and the market will not be competitive.

While all parties involved want the legalization of Wisconsin online sports betting, Stewart said further discussion on the bill is necessary to make it appropriate for all stakeholders.

“We recognize the tribes primary role in all of this. We want to tether with them, which gives them a leadership role. We want to find a way to work with them, combined with a way to make this appropriately done for everybody,” he said.