A resolution to take sports betting online in South Dakota appears dead after a legislative hearing on Wednesday, but industry sources suggest it could come back.
The House State Affairs Committee voted against advancing SJR 504 on a 7-6 split. Prior to the vote, committee members declined to amend the bill. The committee then deferred the legislation beyond the final day of the session, 11-2; a move that effectively kills the bill for now.
“I’m all for destination gambling in Deadwood. That’s good, clean fun, and the wider net effects on South Dakota tourism are positive,” Rep Scott Odenbach, the committee chair, said. “But I think this measure runs the risk of putting us at risk of an addictive form of gambling.
“Our original constitution prohibited us from any game of chance and the only exceptions we have are Deadwood gambling and video lottery. I have too much fear people will sit on their couch and say they don’t need to go to Deadwood. Long term, this isn’t for the best.”
The resolution would put statewide mobile sports betting on the ballot for voters to decide in November. Voters approved of sports betting in 2020, but it is limited to wagering at casinos in Deadwood.
The Senate passed SJR 504, 23-10, earlier this month.
Multiple industry sources, however, suggest the effort might be revived this session via an unspecified amendment to come.
Lengthy sports betting hearing in South Dakota
Odenbach said he would limit discussion on the legislation to about 10 minutes, although it lasted nearly an hour.
Multiple proponents, including sponsors Rep Greg Jamison and Senator Steve Kolbeck, said online sports betting is already happening in South Dakota and should be regulated. Jamison is the House Majority Whip.
Jamison said the state could generate up to $5 million in tax revenue annually.
Kolbeck said the revenue would help property tax relief, which he said the legislature continues to try to solve. He said right now a “flood of money” is leaving the state from bettors crossing the border to Iowa.
Proponents said residents should decide the issue by referendum.
“If you think we should fight and compete, we should give it to the voters,” Kolbeck said. “If they approve it, we can put guardrails around it.”
Caleb Arceneaux, president of the Deadwood Gaming Association, also supported the resolution, noting that sports gambling is already taking place with offshore operators and prediction markets that lack consumer protection regulations. Arceneaux also mentioned a key goal of the legislative session is to provide property tax relief.
John Pappas, senior adviser to GeoComply, testified in support of the resolution by referring to demand for sports betting in South Dakota. The company recorded 1.6 million geolocation checks from 55,000 accounts attempting to log into legal sportsbooks in other states.
Tribes fear exclusion
Frank Star Comes Out, president of the Oglala Sioux Tribe, opposed the resolution as the chairman of the Great Plains region and its 17 tribes.
He said the language should be changed to explicitly allow tribes access to sports betting.
“We do support it, but with amendments,” he said. “Tribes in South Dakota should be included in any opportunity to provide online sports betting on equal footing with Deadwood casinos.”
Star Comes Out said consultation with tribes is important when dealing with gambling issues in South Dakota. Multiple religious groups also testified against SRJ 504.
Pat Evans
Pat covers the legislation and regulation of online gambling in North and South America, having covered the US sports betting industry extensively since 2019.
Original article: https://igamingbusiness.com/sports-betting/online-south-dakota-sports-betting-bill-stopped/
