Washington, D.C. Council to Evaluate iGaming Legalization

• Washington, D.C. Councilmember Wendell Felder has introduced a bill to legalize iGaming
• Bill B26-0656 also prohibits dual-currency sweepstakes games
• If approved, operators will be subjected to a 25% iGaming tax rate

After launching online sports betting in the summer of 2024, members of the Washington, D.C. Council are now evaluating the possibility of legalizing iGaming in the district.

Councilmember Wendell Felder (D-Ward 7) introduced B26-0656, the Internet Gaming and Consumer Protection Act of 2026, a bill to legalize iGaming and prohibit dual-currency sweepstakes games in the district.

“This bill reflects a practical, data-informed approach to strengthening consumer protections, modernizing our gaming framework, and capturing revenue that is currently flowing outside of the District’s oversight. iGaming, online casino-style games such as blackjack, poker, roulette, and slot-style games played on mobile devices or computers, is already accessible to District residents through unregulated and offshore platforms. In the absence of a legal framework, these platforms operate without meaningful consumer safeguards, age verification, or regulatory oversight, creating risks for residents and limiting the District’s ability to respond,” Felder wrote in the legislation text.

Generating Substantial Tax Revenue

If approved, the legislation will establish regulatory oversight of iGaming under the Office of Lottery and Gaming. It will set a minimum age of 21 for iGaming, impose a 25% tax on gross iGaming revenues for operators, and set a $2 million price tag for each iGaming license.

Licenses will be valid for five years, at which operators can pay a $500,000 renewal fee for another five-year license if approved.

The legislation earmarks the first $500,000 of iGaming revenue for the Department of Behaviors Health for prevention, education, and recovery services related to gambling addiction and “related behaviors health needs.”

Any additional iGaming revenue will be disbursed as follows:

• 30% to the Department of Insurance, Securities, and Banking for debt management, financial counseling, consumer financial protection, and financial literacy programs
• 30% to the Office of Victim Services and Justice Grants for domestic violence, intimate partner violence, survivor services, and family stability programs
• 10% to the Department of Health for research and evaluation services on gambling behavior and gambling addiction
• 30% to the Department of Employment Services for youth development and training programs related to artificial intelligence, gaming, coding, and software development

“For the District, the potential fiscal impact is meaningful. Based on comparable markets and conservative projections, legalizing iGaming could generate substantial new tax revenue over time, alongside upfront licensing fees. Initial annual tax revenue could reach tens of millions of dollars, with growth expected as the market matures. These funds could support critical priorities, including behavioral health services, responsible gaming programs, and broader community investments,” Felder noted.

Sweepstakes Game Prohibition

In addition to the legalization of iGaming, the bill will also prohibit dual-currency sweepstakes games in Washington, D.C.

“Inaction carries real consequences. Without a legal framework, revenue continues to flow to unregulated operators, consumers remain exposed to risk, and the District falls behind neighboring jurisdictions that are moving forward. By advancing this legislation, we can bring an existing market into a regulated environment that prioritizes safety, accountability, and public benefit,” Felder wrote.

The bill will prohibit dual-currency gaming products, which are defined as “a game promotional scheme, or platform that uses 2 or more forms of currency, credits, tokens, entries, points, or similar units, whether purchased or awarded, where one or more such units may be redeemed, converted, transferred, or used directly or indirectly for cash, cash equivalents, prizes, or prize equivalents.”

If an individual or group is found to be offering a dual-currency sweepstakes game in the district, the Office of Lottery and Gaming can impose a civil fine of not more than $100,00 for each violation or a fine of not more than $500,000 if the same violation occurs multiples times.