The ball continues to slowly move down the field for Tennessee sports betting.
The Tennessee Sports Wagering Advisory Council is set to meet again in Nashville on March 10, following a meeting on Feb. 18. It’s a relatively quick turnaround for the Council, which is helping assist the Tennessee Education Lottery craft regulations for the industry. The TEL and the Council first met publicly in November, releasing draft regulations ahead of a public comment period.
Tennessee regulators have expressed a sense of urgency in implementing the Sports Gaming Act, which became law last summer. The betting community has grown somewhat impatient with the long wait.
The March 10 meeting comes as new legislation sits on the table in Nashville that, if enacted, would put more regulatory responsibility on the Council, effectively placing it in charge of the process. Neither proposal has had a hearing, and it’s unclear whether the legislation ever will. It’s also unclear what impact a law amending the Sports Gaming Act would have on the timeline for the launch of mobile betting.
Tennessee, home to no casinos, is going with an internet-only sports betting industry.
The situation in the Volunteer State with regard to implementing the Sports Gaming Act remains fluid.
House Speaker Cameron Sexton and Lt. Gov. Randy McNally, both of whom have a role in determining the membership of the Council, recently expressed concerns about the first draft of regulations with regard to licensing and fees for companies ancillary to the sports betting industry. The TEL and the Council are expected to be close to releasing a new version of the regulations, after the meeting last month ironed out some of the long list of issues. The regulations are expected to be finalized within the next couple of months.
For sports bettors who are put to sleep by all this statutory and regulatory inside baseball, the two pressing issues pertained to parlays and a fixed payout cap.
The TEL decided last month to get rid of a proposed rule that would have made a parlay a loss even if one part of the parlay was a push, which is not industry standard. The TEL admitted it made a mistake with that proposed rule. The decision to dump the rule was a win for bettors.
Secondly, the TEL decided last month to go with a 92% fixed payout cap, which means that books must retain at least 8% of the handle in the form of winnings over a yet-to-be-determined time frame (at least a year). The original rule was for an 85% payout cap, which would have been significantly less industry friendly and also problematic for sports bettors in the legal market.
It’s unclear how a sportsbook would ensure that it has a 92% payout cap. It is very possible that the rule will be a win for the unregulated, illegal market that already exists in the state, which is comprised of local bookies and offshore websites. The TEL’s claim is that a fixed payout cap is typical in lottery-run sports betting markets, that it can boost revenues to the state and also ensure more robust competition.
For the average gambler, the only question that really matters at this point is when betting can begin. The TEL is anticipating the regulatory process and getting companies approved for wagering will take a handful of additional months, at least, with a potential launch date ahead of the next football season. It is possible, though right now probably unlikely, that Tennessee’s legal market doesn’t begin until 2021.