Tennessee Regulators Discuss Changes To Where Sports Betting Taxes Go

Posted on November 9, 2021

Tennessee’s Sports Wagering Advisory Council (SWAC) held a meeting Tuesday, Nov. 9 to provide updates on its ongoing transition to becoming sports betting’s regulatory body. The council also began considering new potential benefactors of Tennessee sports betting taxes.

Council questions allocation of Tennessee sports betting taxes

One subject that was brought up multiple times in the meeting was where the state’s sports betting tax dollars go.

With the SWAC taking over the Tennessee Education Lottery’s (TEL) regulatory duties on Jan. 1, some council members were left wondering whether TEL initiatives should get the bulk of the money going forward.

As the statute is currently written, Tennessee sportsbooks pay a 20% privilege tax on adjusted gross income each month.

From that percentage, the TEL allocates 80% to its Lottery for Education account. State road and infrastructure projects receive a 15% cut, and the remaining 5% goes toward the state’s gambling addiction treatment programs.

Tennessee lawmakers have been urging the state for enhanced assistance for public schools for quite some time now.

Back in March, one state representative proposed the TEL use a portion of the privilege tax to offset public school maintenance expenses.

During the most recent meeting, council member Hanes Torbett questioned whether local sports programs might be able to benefit from any percentage of this tax.

Tennessee sports betting’s ongoing regulatory shift could serve as the perfect opportunity to reallocate funds to initiatives such as these. The General Assembly, however, must first approve any proposed changes.

Mary Beth Thomas recommends new hires

After discussing taxes, the SWAC’s new Executive Director Mary Beth Thomas gave an update on her time in the role so far.

Since assuming her role last Monday, Nov. 1, she has secured a new SWAC office location inside downtown Nashville’s Davy Crockett Building. Her plan is to be able to operate out of the new space by Nov. 15.

Thomas has also begun seeking out qualified contenders for some of the SWAC’s most critical open job positions.

She recommended three candidates for consideration during the meeting, each of which the council subsequently approved for hire.

Roger Guillemet, who initially applied for the position of executive director, will become the SWAC’s new deputy director of gaming licensure and compliance.

Nashville attorney Stephanie Maxwell will assume the position of general counsel.

Fellow Tennessee native Keith Boring will take on a dual role, acting as both deputy director of administration and chief of staff.

Each of these new hires will officially start on Jan. 1 when the SWAC fully assumes its role as Tennessee’s regulatory body for sports wagering.

Until then, Thomas says she will continue to prioritize the rulemaking process. The council’s Rulemaking Committee is discussing final changes to its draft rules after hearing public comments in October.

The council will meet a final time before presenting a final draft of the new emergency regulations.

Continuing council education

Thomas looks to create more opportunities for the council to become better versed in the sports betting industry now that she is manning the helm.

This trend originally began in the previous SWAC meeting, which featured a demonstration from GeoComply on geofencing.

Veteran bookmaker Art Manteris will also present on the “Fundamental Principals of Sports Wagering” to the council on a future date.

Members also requested a presentation from the Department of Mental Health about how it uses its 5% of allocated resources toward gambling addiction treatment. They also expressed interest in hearing from Tennessee’s gambling addiction hotlines.

Specifically, they want to know about the volume of calls and any issues the hotlines may be having.

Photo by Shutterstock
Alec Cunningham Avatar
Written by
Alec Cunningham

As a college athlete, Alec Cunningham played Division II golf at Tusculum University. She graduated in 2015 with a bachelor’s degree in Journalism and Professional Writing. Alec has spent the last five years working in the music industry as a concert promoter, tour manager and artist developer. As a journalist, she has covered a variety of topics and currently specializes in the Tennessee online sports betting industry.

View all posts by Alec Cunningham