Washington, D.C. Council Mulls Benefits, Harms of Legalized iGaming

• The Washington, D.C. City Council listened to nearly four hours of testimony on legalized iGaming
• The Committee on Human Services evaluated the potential harms and benefits of legalizing iGaming in the district
• Washington, D.C. Councilmember Wendell Felder introduced a bill to legalize iGaming in April

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As the members of the Washington, D.C. City Council heard on Monday afternoon, illegal iGaming is undoubtedly happening in the district right now, but it remains to be seen if legalizing the activity will drive customers to the legalized markets.

The Washington, D.C. City Council Committee on Human Services listened to nearly four hours of testimony on legalized iGaming, as the city council is considering Councilmember Wendell Felder’s (D-Ward 7) bill,  B26-0656, the Internet Gaming and Consumer Protection Act of 2026.

The bill will legalize iGaming and prohibit dual-currency sweepstakes games in the district.

Will Legalized iGaming Provide Necessary Safeguards?

The Human Services Committee listened to several hours of testimony from representatives of the iGaming industry and those who opposed the legalization of the new form of gaming.

The committee did not take a vote on the bill. It will have to be approved in front of the full 13 member council before becoming law.

Felder opened the hearing by noting that district resident are currently participating in illegal iGaming through unregulated markets to the tune of nearly $700 million a year. Whether anyone actually chooses to acknowledge this or not, Felder said, it is indeed happening.

“The question is whether the district will continue allowing millions of dollars to flow outside of our oversight and outside of our economy,” he said.

However, opponents of legalized iGaming said it is not proven that residents of a district with legalized iGaming will choose to participate in a regulated market. Oliver Barie, representing the National Association Against iGaming, reported illegal gambling revenue actually grew nearly 64% in 2024 compared with the year before.

Brianne Doura-Schawohl, spokesperson for Campaign for Fairer Gambling, shared data from a study published by Penn State University that shows more than 10% of Pennsylvania adults gambled on illegal sites in 2025, an increase from 6% from the year before. It is not a guarantee, she noted, that consumers will automatically choose to participate in a regulated market just because it is offered.

Outside of the illegal markets, Les Bernal, National Director of Stop Predatory Gambling, said Washington, D.C. residents are estimated to lose $400 million in sports betting and lottery combined in the next five years.

It is a con, Bernal said, as district residents are losing $150 a minute in gambling. Legalized iGaming will simply give operators access to a greater number of residents and will not protect them from gambling harms, he said.

“It’s like putting Dracula in charge of the blood bank,” Bernal said.

Losing Out on Millions in Revenue

Proponents for iGaming agreed with the sentiment that the gaming is happening in the district, but without legalization D.C. is losing out on millions in revenue and denying residents participation in a safe, regulated market.

Since DraftKings launched online sports betting in the district, the operator has contributed nearly $11 million in tax revenue, Matt Scalf, Senior Government Affairs Manager, DraftKings, told the committee.

By not legalizing iGaming, Washington, D.C. is losing out on hundreds of millions in revenue each year, he said.

“Importantly, iGaming is already occurring in the District today, through unregulated sweepstakes-style platforms and illegal offshore operators. These entities generate $18.8 billion
annually nationwide, without paying taxes or adhering to basic player protections. For the District, this represents an unrealized recurring revenue opportunity estimated at $500 million over the five-year financial plan,” Scarf said.

John Pappas, representing iDevelopment and Economic Association (iDEA), reported more than 100,000 visits a month are made from D.C. residents to illegal, offshore gambling sites. iGaming is happening in D.C. right now, he said, and has been clearly identified.

Legalizing iGaming in the district is the right public policy approach, said Michelle MacGregor, representing the Sports Betting Alliance. These companies have hundreds of dedicated responsible gaming employees who monitor players for signs of gambling compulsion and encourage them to take advantage of the responsible gaming tools on their operating platforms.

If legalized, Both Scalf and Robert O’Connor, Vice President of Government & Industry Affairs for BetMGM, said six months would be more than enough of a window to launch iGaming in D.C. with the necessary safeguards for consumers.

Washington, D.C. iGaming Bill Details

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

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

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.