Montana Legislature Weighs Two Sports Betting Bills on Tight Chamber Deadlines

Posted on: April 2, 2019, 07:18h. 

Last updated on: April 2, 2019, 07:21h.

Steve Bittenbender Read More

Expertise: Legislation, Sports Betting, Horse Racing.

The Montana State Legislature has beaten the deadline to advance two bills that could legalize sports betting in the state.

On Saturday, a state House bill that would give oversight to the state lottery passed by an 88-10 vote. The state Senate, on Monday, passed 36-14 a proposal that would give the state’s Department of Justice oversight.

The chambers faced a Monday deadline to approve their bills and send them to the other chamber.

The legislative session ends on May 1.

Controlling Destiny

State Rep. Ryan Lynch (D-Butte), sponsor of House Bill 725, told his House colleagues the key benefit to his bill is that the state controls the lottery. Sports gambling, he added, would give the state-run agency one more product to offer customers.

“So, we’re the beneficiary of those revenues,” he said on Friday. “But we also have control to make sure gaming is done responsibly.”

Angela Wong, the lottery’s director, spoke in support of the bill at the Appropriations hearing last week.

Retailers receiving sports bets would receive a 6 percent commission, while lottery officials will set aside 7 percent for a platform vendor. Operating expenses would start at 1.25 percent in 2020 and gradually decline to .85 percent three years later.

Sports betting would allow the lottery to hit the $12.4 million general fund transfer cap to the state budget, advocates said. Remaining revenues would go to a state STEM Scholarship program that currently receives no funding.

That scholarship fund would get $2.7 million in 2020 according to the bill’s projections. Those funds would grow to $4.6 million in three years.

On Monday, the state Senate assigned Lynch’s bill to the Business, Labor, and Economic Affairs Committee. A hearing has yet to be scheduled for the measure.

Senate Bill Helps Establishments

Senate Bill 330, sponsored by state Sen. Mark Blasdel (R-Kalispell), calls on the state to award licenses to two sportsbook operators and two platform vendors.

Betting kiosks would be set up across the state, allowing people to go to bars and other establishments that offer gaming to also bet on sports. Online gaming would also be allowed, although it would be restricted only to the establishments where gambling is permitted.

Rather than directly controlling the revenue, Blasdel’s bill calls for an 8.5 percent tax on the adjusted gross betting receipts. He said the tax rate falls between what other states take. Nevada taxes at 6.75 percent, while other states collect 10 percent or more.

If the tax rates get too high, the odds get too high,” Blasdel said Friday on the Senate floor. “And those on the black market or behind the scenes aren’t going to come out to these kiosks.”

While Blasdel’s bill estimates the state would only receive a little more than $1 million in tax revenue annually for the first three years, he and other proponents say the bill would help generate new revenue for the bars and establishments that host the kiosks.

Blasdel’s colleague, state Sen. Dee Brown (R-Hungry Horse), scoffed at that notion. If there are concerns about the black market, why limit sports betting — including online betting — to those establishments, she said.

“I don’t believe that for a minute,” Brown said about the notion people will bypass their bookies to go to local bars. The black market folks may be there already, she added.

The state House Business and Labor Committee is scheduled to hear Blasdel’s bill on Friday.