Because of a single word, Arkansas’ three casinos will not be allowed to accept mobile wagers on the Super Bowl, set for February 13.
The word “revenue” was changed to “receipts” by the state Racing Commission, leading commission attorney Byron Freelance to pull proposed mobile betting rules from review by the Legislative Council’s Administrative Rules Subcommittee, Department of Finance and Administration spokesman Scott Hardin said. The Racing Commission is part of the finance department.
Hardin said the word change was described as “a correction.” He said Freeland’s decision to pull the proposed rules will provide more time to thoroughly address the concerns of state legislators and other interested parties. Hardin said, “The commission understands making a change, although small, to the wording one day prior to legislative review results in new questions. By holding the rules until February or March, we ensure continued full transparency.”
Governor Asa Hutchinson noted, “There have been concerns expressed by numerous legislators about the late change in the language of the rules for mobile sports betting. The change does not appear to be significant, but in fairness it made sense to consider the rules in regular order at the next meeting.”
Freeland told commissioners the proposed change was made due to public comments questioning what the commission meant by net casino gambling “revenue.” He said the word change is consistent with Amendment 100 to the Arkansas Constitution, which voters approved in November 2018, authorizing the Racing Commission to license one casino each at the existing Hot Springs and West Memphis racetracks and Jefferson and Pope counties. Freeland said although there is no difference in the dictionary definitions of revenue and receipts, there is a legal argument that if a third-party vendor gets a majority of the revenue from online sports betting, that would violate Amendment 100 to the Arkansas Constitution.
On December 30, the Racing Commission unanimously approved the proposed rules allowing mobile sports betting through the state’s licensed casinos, including granting established casinos 51 percent of the proceeds when partnering with online bookmakers; nationally, local casinos’ share is 5 percent to 15 percent. The word “revenue” was changed to “receipts” in the following proposed rule: “Operation of an online sports pool shall be prohibited in circumstances in which a majority of the net gaming revenue, as defined in Amendment 100, from the online sports pool is paid to a third-party vendor assisting in the operating of the sports pool.”
Carlton Saffa, chief market officer for the Saracen Casino Resort in Pine Bluff, said, “The Saracen team was prepared to speak in favor of the rule allowing mobile sports wagering. We had hoped to have this authorization before the Super Bowl. We planned to have subject matter experts as well as vendors representing state-of-the-art technology on hand to address any questions members may have had. We look forward to addressing the issue next month and are optimistic that, just as the Racing Commission passed the mobile wagering rules 7-0 on December 30, the Legislative Council will be supportive. Mobile wagering has broad support and is something Arkansans ask us for daily.”
In an email to Freelance, Nicole Gillum, general counsel for the Capitol Advisors Group, wrote, “We have repeatedly raised the concern about the definitions included in the proposed mobile sports betting rule. We have also repeatedly expressed our concerns around the revenue share provision contained in said rule.”
However, state Rep. Les Eaves, co-chairman of the Legislative Council’s Administrative Rules Subcommittee, noted, “Several members have expressed concerns about changing a definition in the rule after it has already received public comment.” State Senator Kim Hammer, who also is a co-chairman of the subcommittee, said, “I was beginning to hear pushback that the revision in the proposed rule should go back to public comment because it was a change. One word can have a significant meaning like the difference between may and shall.”
