On Tuesday the Tennessee Education Lottery and its Sports Wagering Advisory Council held another hearing to continue to fine-tune the state’s sports betting market.
As stated in a meeting last week, the TEL said the state’s four sportsbooks took over $15 million in wagers on the Feb. 7 Super Bowl. The TEL said that the books saw $211 million in January handle, with revenue of $21.8 million. The state collected more than $4 million in taxes on that revenue, the TEL said.
More than $520 million was been wagered since the books launched on Nov. 1.
In addition, the TEL and the SWAC briefly discussed a peer-to-peer betting model being sought by pending applicant ZenSports. Regulators are going to need more time to see how peer-to-peer betting squares with the 2019 Sports Gaming Act before potentially allowing it. ZenSports will offer traditional bookmaking with or without peer-to-peer wagering, but P2P is the firm’s claim to fame.
TEL CEO Rebecca Hargrove said she’s “not in favor of it” but is “more than willing to spend more time analyzing it,” while Chairwoman Susan Lanigan said that the state attorney general’s office should weigh in. At issue is how revenue from a peer-to-peer model would be taxed, as that type of wagering could fall outside the definition of adjusted gross sports betting income, meaning that the state wouldn’t get a piece of the action. That is a no-go for regulators.
Tennessee applies a 20% tax to gross revenue from sports wagering.
Sports betting gift cards?
Also up for brief public debate was allowing operator sports pools (i.e. March Madness brackets) and betting gift cards, with regulators wanting to make sure such a gift card can’t be purchased with a bank-issued card, whether debit or credit — but with cash only. For example, if a person at a grocery store wanted to buy a sports betting gift card marketed by one of the licensed operators, they couldn’t use a debit/credit card to pay for that gift card along with, let’s say, a gallon of milk. The gift card would have to be a separate transaction, in cash, according to what was discussed at the Tuesday meeting.
Regulators are comfortable with gift cards but apparently are looking at ways to ensure they can only be purchased with cash. Similarly, lottery tickets can’t be purchased with a card, according to the TEL.
Additionally, regulators were looking at ironing out some remaining procedures regarding potential fines against sportsbooks for any violations. To date, no operator has been fined for any violation, such as allowing underage play or taking a bet from a person located out of state.
“Integrity is the only thing we really have to sell,” Hagrove said amid the various discussions. “It’s important we protect the integrity of sports betting in Tennessee.”
One integrity concern that the TEL appears to have been on top of was illicit Super Bowl wagering. Few details are available at this time, as law enforcement is currently looking into the matter. As the TEL stated last week, 74 sports betting accounts were shuttered due to some form of illegal wagering on the Super Bowl. ESPN’s David Payne Purdum received a comment from the NFL in the following thread:
74 betting accounts were closed after an investigation by the Tennessee Lottery revealed betting anomalies on the Super Bowl. The Lottery said it is working with law enforcement on the ongoing investigation. First-reported by Brian Pempus of https://t.co/PTlyw5hKSS 1/2
— David Payne Purdum (@DavidPurdum) February 22, 2021
Regulators on Tuesday didn’t give any firm dates for when WynnBET, TwinSpires, and William Hill will hit state cyberspace. All three sportsbooks have been approved for wagering but haven’t received the final green light to commence operations. The state could have seven apps in the coming weeks.