When the U.S. Supreme Court last May lifted the federal ban on sports betting, Oregon was one of four states unaffected because the now defunct Professional and Amateur Sports Protection Act had grandfathered them in.
So now Oregon is miles ahead of many other states in adopting sports betting rules and in March announced it had selected a vendor to offer the service through the Oregon Lottery: SB Tech.
State officials hope to have mobile and kiosk offerings ready to go in time for the upcoming NFL season. But first, the Oregon Lottery must finish developing regulations, and then make them available for the public to comment on before they can be implemented. The time it will take to go through that process is unclear at the moment.
The roll-out will be in phases, according to lottery spokesman Chuck Baumann. At first bettors will be able to pick winners in contests, both outright and against the spread. From that point offerings will be added. Baumann commented, “The plan on our end is to be up and running for the 2019 NFL season.”
When the Lottery announced last month it was picking SB Tech as vendor, one of the other bidders for the contract, Scientific Games, protested. It sent a letter claiming that SBTech was too inexperienced to operate yet in this country. The letter urged the lottery to investigate SB Tech, which it said, should “demonstrate good character, honesty and integrity and sufficient financial stability and responsibility, and reliability to assure good faith performance.”
Currently SBTech, operates with five U.S. casinos with three U.S. partners, Churchill Downs, the Golden Nugget and Resorts Casino, and in two states, New Jersey and Mississippi. It also operates in multiple jurisdictions globally.
The letter implies that SBTech may have ties to entities that offer sports betting in jurisdictions where it is still illegal, and if it is that ought to disqualify it from offering it in Oregon.
The lottery replied that it intended to vet SBTech thoroughly. “Oregon Lottery affirms that it will make a Responsibility determination and conduct the background check according to the RFP, the applicable rules and statutes,” said a spokesman. On April 5 the lottery commission approved SBTech as vendor, although that is contingent on a positive vetting process, which is due to be completed by April 19.
The lottery and SBTech are still working out details of the contract, which will probably be for three to five years. It is expected to be finalized by the end of April. Lottery COO Farshad Allahdadi said the revenue sharing contract would be tiered with the vendor getting 9 percent – 11 percent.
Allahdadi told the commission April 5, “Based on preliminary security and due diligence investigations, the Oregon Lottery believes entering into a contract with SBTech is consistent with our principles of fairness, integrity, security and honesty.”
Referring to the vetting of the company, he said, “We are well along the way in our background check process. We have done a lot of our review and feel at this point preliminarily that there are no issues that would prevent us from entering into a contract. However, as I indicated, we still have a couple of weeks left in the process to finalize our due diligence.”
One of the commissioners commented on the Scientific Games letter: “SBTech did disclose both relationships that were raised in the letter. We looked into those and found nothing untoward.”
Allahdadi assured the commissioners, “We are not entering into the contract. You are authorizing the director to enter into it pending these final reports.”
The Oregon Lottery reportedly chose SBTech because of its “turn-key, sports betting platform and sportsbook for digital and on-property wagering” which can be employed at brick and mortar locations and online. Its expertise is sports book not lottery—and player-oriented.
Because sports betting was never illegal in Oregon, the lottery has operated under the assumption that no legislation is needed for it to go forward. Last fall when the lottery unveiled its mobile app, it said it planned to offer sports book on the app.
The nine tribes that operate casinos in Oregon have so far done nothing towards offering it.
