On Tuesday, Wisconsin lawmakers began considering a proposal that would legalise online sports betting through the state’s tribal nations, with a committee hearing as the first step in a process that could expand gambling beyond in-person sportsbooks.
The Senate Committee on Agriculture and Revenue heard testimony on Senate Bill 592, which would legalise online sports betting through the state’s tribes. One of the proposal’s co-authors, Senator Howard Marklein, sits on the committee.
“If we do this, it will legalise what a lot of people do right now illegally,” Marklein said during the hearing. “We’ll make this legal and collect taxes on this, which we certainly need.”
The bill, which was not voted upon Tuesday, would legalise sports betting through a “hub-and-spoke system”. It would allow 11 Wisconsin tribes to partner with online sports betting operators, as long as the server used for wagering is on federally recognised tribal land. It would legalise a system similar to the one used in Florida, where the Seminole tribe has a monopoly.
The bill would require the tribes to renegotiate their gaming compacts with the state, with approval also required from the federal Bureau of Indian Affairs.
Marklein co-authored the proposal with representatives Kalan Haywood and Tyler August and Senator Kristin Dassler-Alfheim.
“For too long, illegal, offshore entities have profited from consumers through unregulated sports wagering, without generating revenue for local economies,” Haywood said in a statement last month to iGB. “By regulating this multi-billion-dollar industry, we can provide a safer mobile wagering experience for Wisconsin consumers and generate much-needed revenue to invest into our communities.”
Tribes support sports betting
The Ho-Chunk Nation, which filed a lawsuit against prediction market operator Kalshi contending it was offering illegal sports betting on tribal land, testified in favour of the bill on Tuesday, explaining its extensive tribal government could use the additional funds.
Forest County Potawatomi Community Attorney General Jeff Crawford said the Milwaukee Bucks, Milwaukee Brewers and Green Bay Packers want to see sports betting legalised. The tribe has partnerships with the professional sports teams.
Crawford also said Wisconsin residents already bet millions of dollars each year and a regulated industry would provide consumer protection. He said the regulated market can provide protections against problem gambling and implement responsible gambling measures.
Opponents express Wisconsin sports betting concerns
Senator Andre Jacque expressed worry about legalising additional forms of gambling in the state.
The Sports Betting Alliance testified during the hearing on behalf of major sportsbook operators, acknowledging it hopes to legalise online sports betting in Wisconsin but does not agree with specifics in the proposed legislation. The SBA representative said the framework is set up under the Indian Gaming Regulatory Act (IGRA) and it would have operators send 60% of revenue to partner tribes. The counsel said major operators like DraftKings and FanDuel would not find it to be economically attractive.
“That number is so large, they would lose money – it just won’t work for them,” the SBA counsel said, adding that tethering to tribes in relationships not dictated by IGRA would be more friendly. He noted sportsbook operators have thriving relationships with tribes in Michigan. He also believes the Wisconsin legislators are rushing the legislation.
DraftKings already has a partnership with the Lac du Flambeau Band of Lake Superior Chippewa Indians and operates an in-person sportsbook at Lake of the Torches Resort Casino.
Wisconsin Governor Tony Evers agreed to in-person sports betting in negotiated compacts with the state’s tribes in 2021.
A Senate committee hearing focused on a bill that aims to legalise and regulate mobile wagering through tribal partnerships with operators.