Governor Signs Arizona Sports Betting Bill And Tribal Compacts

Posted By Matthew Kredell on April 16, 2021 - Last Updated on April 22, 2021

Arizona Gov. Doug Ducey must want to get sports betting up and running by the NFL season.

On Thursday, he wasted no time signing the bill legalizing sports betting in Arizona that the legislature passed at the beginning of the week.

Ducey also signed the compacts he worked out with tribal nations to modernize gaming in the state.

At the singing announcement in front of tribal leaders and members of the Arizona legislature, Ducey said:

“I can’t overstate the impact the tribal-state gaming compact amendment and its associated legislation will have on our state. Gaming employs thousands of Arizonans, and it generates millions in tax revenue that benefits areas like K-12 education, conservation, and treatment centers. Today’s signing is a culmination of years of partnership and engagement among many diverse stakeholders — and we did it by bringing everyone to the table, pushing individual agendas aside, and putting Arizona first.”

Lawmakers set goal of sports betting by NFL season

Once he reached an agreement with the tribes, Ducey asked Rep. Jeff Weninger and Sen. T.J. Shope to get the legislation passed.

The bill authorizes 10 licenses for Arizona tribes and 10 licenses for professional sports teams/facilities to offer retail and mobile sports betting. Horse racetracks get another 10 licenses for retail only.

With the compacts with each individual tribe signed, the Bureau of Indian Affairs will then have 60 days to review the compacts.

Weninger put an emergency clause in the bill, meaning it will take effect as soon as the compacts are approved. He thinks that will give the Arizona Department of Gaming time to prepare rules and regulations for the first sportsbooks to launch in Arizona by early September.

“Are all places going to be open and built out by the beginning of football season?” Weninger said. “No. But the Cardinals or Diamondbacks, even if they don’t have their sportsbook finished, could have their online partner ready.”

September goal might be optimistic

Depending on how quickly the compacts get approved, the beginning of the NFL season might be difficult.

The Arizona Department of Gaming will not only need to create rules and regulations. It also needs to ensure each applicant has internal controls in place to launch sportsbooks and mobile betting apps.

Iowa did this process quicker than any state, and it still took three months. If federal approval of compacts doesn’t come until mid-June, that might delay launch a few weeks into the NFL season, which starts Sept. 9.

However, Weninger pointed out that the department can begin working on the rules and regulations now, before federal approval of the compacts.

Sen. TJ Shope noted that lawmakers also want to get daily fantasy football ready for the beginning of the NFL season.

Arizona is one of the few states industry leaders DraftKings and FanDuel weren’t operating in. Without complications from the tribal compacts, DFS seems more likely to launch by the NFL season than sports betting.

Lawmakers navigate through potential delays

The bill signed by the governor is the same one passed by the House on March 4. But the bill seemed in real danger of derailment during the next five weeks.

Senate Appropriations Committee Chair David Gowan attached his bill trying to bring historical horse racing (HHR) to Arizona racetracks. However, tribes said such an expansion would violate their compacts.

After hearing from many on the matter, Gowan agreed to drop HHR from the bill last week and that opened up the opportunity to pass the legislation.

“It was a non-starter from the beginning, and I don’t know how that’s ever going to work because of the way we’ve done it in Arizona via the voter-approved gaming compact,” Shope said. “Other than HHR, I don’t think that anything ever really threatened to kill the bill.”

“It just needed to be released from his committee, and then we knew we had the votes,” Weninger added.

Getting sports betting across the finish line

Over those five weeks, other potential problems arose. Car auction giant Barrett-Jackson tried to get a sports betting license for its auction event venue. Arizona bars tried to get in on the action. The lawmakers said they thought bars were too much of an expansion.

They supported Barrett-Jackson getting a license, seeing a tie-in to promote wagering on car racing events. But the agreement between the tribes and governor was done, and it was too late to make changes now.

“Barrett-Jackson has been in the community for a long time and brings a lot of economic development to the state,” Weninger said. “I think it could attract an entire new audience to bet on racing and things of that sort. But it’s tough that late in the game.”

Any bill supported by the majority party can end up being tied up in politics, as happened in Georgia this year. So, once there was an opening, the lawmakers pounced to get the bill through even though there were another couple of weeks left in the session.

“You get to this time of year, even though people are with you and solid, they start having tenacious battles on other subjects,” Weninger said. “It can carry over to areas unrelated to that bill. So the longer things go, the more there’s reason for concern. I’m glad we got it out and things like that didn’t come into play.”

Photo by AP / Ross D. Franklin
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