Hawaii, which has traditionally been known for its strict stance against gambling, might be seeing that position soften. A new bill has been introduced that could potentially change the landscape of gambling in the Aloha State.
Hawaii is one of just two states in the U.S. that does not allow any form of gambling, along with Utah. Not only is there no legal sports betting, but the state also lacks a state lottery, charitable gaming or tribal gaming.
In an interesting turn of events, Hawaii state Representative Daniel Holt recently filed HB 2765, which proposes the legalization of mobile sports betting in the state. However, it is worth noting that the bill does not provide detailed information on taxes and licensing fees.
If passed, HB 2765 would allow for digital betting apps to operate in Hawaii. However, it explicitly prohibits any brick-and-mortar operations. This means that residents and visitors to the state would only be able to engage in sports betting through online platforms.
In addition to HB 2765, a Senate bill, SB 3376, has also been introduced.
This bill proposes a slightly different approach to gambling in Hawaii. Rather than allowing multiple operators, SB 3376 suggests granting a monopoly to a single operator for digital sports betting and online poker. The bill includes a $50,000 licensing fee and a tax rate that starts at 70 percent in the first year and gradually decreases to 5 percent by the 14th year.
Apart from the mobile betting bills, Hawaii lawmakers are also considering the regulation and taxation of fantasy sports. This would further expand the gambling landscape in the state and potentially provide additional revenue streams.
If the mobile betting bill is passed, there is no cap on the number of operators that could be approved. However, it does require “qualified entities” to have a presence in at least three other U.S. jurisdictions. This means that both national companies like BetMGM, Caesars Sportsbook, DraftKings, and FanDuel, as well as smaller operators like Tipico and Betr, could potentially apply for licenses.
Holt’s bill seeks to amend the state’s revised statutes by redefining the terms “games of chance” and “gambling” to allow for legal sports betting. While most states classify sports betting as a game of skill, Hawaii’s approach would open the door for a broader interpretation of wagering.
Although the bill lacks specific details on taxes and licensing fees, it does outline some key provisions. It suggests that licenses would be valid for three years and would allow for funding of wagering accounts through various methods, including credit cards. Additionally, the bill prohibits employees of wagering companies from betting on their own platforms.
One important consideration in the legalization of sports betting is the minimum age requirement. While the vast majority of states have set the minimum age at 21, there are exceptions. Hawaii lawmakers will likely face pushback from responsible gambling advocates who support setting the legal age at 21. However, seven U.S. jurisdictions, including Kentucky, New Hampshire, and Washington D.C., have set the age at 18.
The idea of legalizing sports betting has been entertained in Hawaii for several years. In 2021, a bill was introduced to allow for sports betting under a pilot program, but it did not gain traction. In 2022, another bill proposed setting the tax rate at 55 percent but it also failed to gain momentum. The fate of the current mobile betting bill remains to be seen, as the Hawaii Legislature adjourns on May 3, with the crossover deadline set for March 7.
