In Home Stretch, Senate Amends Historic Horse Racing Bill To Include Sports Betting

Written By Martin Harris on February 26, 2021

Arizona is one of several states that has not yet legalized sports betting. But lawmakers and other interested parties have given the possibility a lot of consideration.

As it stands, the prospects for legal sports betting coming to Arizona remain uncertain. However, legislation that would do so has at least technically moved forward. It has passed through a committee and into the hands of the state Senate.

Interestingly, the fate of sports betting (this time) has been attached to that of another piece of gambling legislation, one seeking to bring historic horse racing in the Grand Canyon State.

Arizona sports betting bills introduced in both chambers

Earlier this month, Arizona House Rep. Jeff Weninger introduced a bill with bipartisan support that would legalize both retail and online sports betting. The legislation would allow Arizona’s federally recognized tribes to open sportsbooks in their casinos. It would also permit them to launch and operate online sportsbooks.

According to the bill, the tribes could obtain up to 10 sports betting licenses. In addition, 10 more licenses could go to “commercial sports entities” in the state. That would include professional franchises like the Arizona Cardinals and Arizona Diamondbacks. The law would additionally authorize daily fantasy sports and allow off-track betting sites to begin offering keno.

Sen. Thomas Shope introduced a similar bill on the Senate side. Either bill would require the tribes’ approval to move ahead. Meanwhile, Gov. Doug Ducey, a supporter of gambling expansion, continued working to secure such approval while renegotiating the tribal-state compacts due to expire in 2022.

New combined bill joins sports betting, historic horse racing

As discussions on those bills proceeded, a separate bill filed by Sen. David Gowan emerged, seeking to authorize historic horse racing (HHR) in the state.

Historic horse racing, also known as “instant racing,” involves wagering on previously run horse races on an electronic video terminal. The games resemble and often play like video slots. However, in jurisdictions that permit HHR machines, the games fall under the same pari-mutuel wagering laws that allow betting on horse racing.

According to proponents of the bill, which has garnered support from the state’s horse racing industry and various businesses, allowing HHR machines would add thousands of jobs and could generate between $100 and $140 million in new state tax revenue.

The bill potentially runs up against tribal interests, allowing non-tribal race tracks and OTB sites to provide a form of gambling. Supporters note how the bill expressly limits the potential impact on tribal gaming revenues. They also cite how historic horse racing technically falls under the state law authorizing pari-mutuel wagering, which predates the tribal-state compacts.

But what will the tribes say?

The two causes were joined together this week when the sports betting legislation was added as an amendment to the historic horse racing bill. On Tuesday, the Senate Appropriations Committee barely passed the combined bill SB 1794 by a 5-4-1 vote. The next day, the Senate Rules Committee unanimously forwarded the bill onto the entire Senate.

The Senate has not yet scheduled a hearing to discuss SB 1794.

What, then, is the likelihood that the newly combined bill authorizing both historic horse racing and sports betting in Arizona will continue to move forward? Probably not great.

The state cannot pass SB 1794 as written without the tribes’ consent. Doing so would violate current tribal compacts. That means the new, renegotiated compacts would have to permit non-tribal entities to offer gambling as provided for in SB 1794.

Despite both historic horse racing and sports betting having proponents, the complications both would introduce for the tribes appear prodigious. Indeed, including historic horse racing as part of the package may well hurt the cause for sports betting. After all, unlike other entities, the tribes at present have no specific interest in HHR.

In any event, all interested parties wait to see if the Senate will take up the bill before the current legislative session ends in late April.

Photo by AP / Morry Gash
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