The plan to legalize sports betting in Hawaii will have to wait another year as lawmakers failed to agree on the details of the bill.
Rep. Daniel Holt’s House Bill 1308 had made progress, passing committees in the House and Senate, but details such as tax rates were the sticking point.
Speaking on the bill’s failure, Holt commented, “We just haven’t come to an agreement on the details with number of operators, tax rate, fees and those kinds of things.”
The bill originally proposed a tax rate of 10% and a license fee of $250,000 for sportsbooks. However, discussions in the House led to these details being removed. The Senate then added the same details back in and passed the bill. But, after returning for discussion in the House, lawmakers again could not agree on the rates.
Holt was encouraged by the bill’s progress this year, stating, “We put our best effort forward, we got it very far this year.” Yet, it was not far enough before the legislative deadline of May 1st. Holt will have to go back to the drawing board and draft another proposal for next year, but he remained upbeat.
“It is what it is, and we just got to work harder next year,” he said, “Try to answer the questions that the rest of the members and the public has and see if we can capture this tax revenue that we much need for our state.”
Push to legalize sports betting in Hawaii
The tax revenue is a big factor in legalization. Gov. Green looked ready to sign off the bill if it was passed. He commented that the majority of Hawaiians support legalization, if the funds are used wisely.
He stated, “We got a survey or poll of people and about two out of three in our state wanted to do gaming as long as the monies went to an important set of projects, mostly housing.”
Others had advocated for the funds to be used for the new Aloha Stadium being built. On the construction project, Green commented, “We really would like to have $800,000,000 to build a modern stadium as a part of this district, and that’s why people are talking about gambling.”
The Hawaii Department of Business, Economic Development & Tourism (DBEDT) conducted a study to assess the potential tax revenue from legalizing online sports wagering in the state. They estimated that the first year would bring in around $13.6 million, and after five years, over $40 million.
Unregulated betting will continue
The failure to legalize sports betting in Hawaii leaves the door open for the unregulated industry to thrive. The Sports Betting Alliance (SBA) have been pushing for legalization and commented, “Hawaii can’t afford to ignore the illegal sports betting market any longer.
The SBA believes that “A legal, regulated market would provide real safeguards and protections for players while generating millions in revenue for Hawaii.”
The organization, made up of some of the nation’s biggest sportsbooks, estimate that Hawaiians bet over $300 million a year. Reports also suggest there are over 7000 illegal game rooms operating in the state.
One resident commented, “Most of us have a bookie that comes around to collect our bets on the Super Bowl, March Madness, and other big games. It’s common, a part of the culture.”
Offshore sportsbooks, crypto betting sites, and prediction markets also offer residents the chance to gamble online. The bill’s failure is good news for the alternative gambling markets, but bad news for the SBA.
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