Time Ticking on Tennessee Sports Betting Comment Period

Posted on December 22, 2019 - Last Updated on March 9, 2020

Tennesseans, the time to make your voice heard on legal sports betting regulations has been extended. The Tennessee Lottery lengthened the sports betting comment period.

Anyone interested in doing so now has through Monday, Jan. 6, 2020. There are serious needs for the lottery to address in the current regulations, so feedback could prove crucial for the process.

Why the sports betting comment period extension matters

Before the extension took place, the comment period was set to end Monday, Dec. 23. While that would have given the Tennessee Sports Betting Council more time to digest the comments already submitted, the extension has an upside to it as well.

Research shows that people’s awareness of changes in the gambling industry isn’t high. Additionally, many Tennesseans may not understand the legal jargon in the draft regulations.

Extending the comment period allows for more people to read plain-English breakdowns of the regulations, like the following:

The more Tennessee residents clearly understand the lottery’s proposals, the better. That means the council has a chance to get informed opinions from not only potential bettors but industry stakeholders as well.

A lot of the existing rules are consistent with best practices. There are some issues, however, that need modification. That goes beyond Tennessee’s limitation on college sports betting and questionable parlay rule.

Areas to look at in the existing Tennessee regulations

As expertly pointed out by John Holden for Legal Sports Report, there are some additional peculiarities. Comments from the public may right them.

These include a requirement for future legal sportsbook operators to share suspicious activity with sports leagues but no reciprocal provision. That’s a problem because sportsbooks have as much if not more to lose from match-fixing as the leagues do.

Another problem is that the lottery doesn’t disqualify individuals who have been convicted of tax crimes from obtaining an operator license. As one of the main reasons to legalize sports betting was to supplement the state’s revenue through new taxes, this seems inconsistent. It’s even more surprising considering the regulations do make anyone who has a drug conviction ineligible.

Additionally, the current regulations require sportsbooks to hold 15% of their handle. This would limit the ability of sportsbooks to not only offer competitive odds but market themselves as well.

In an industry where awareness and promotion are key, forcing operators to sit on some of their resources outside of industry standards isn’t good policy.

One big potential problem for the big names in the games

A final area that could be problematic involves ineligibility for license holders again. How much of a problem it would be depends on interpretation if the statute does make it into the final rules.

The statute aims to prevent illegal bookies and offshore sportsbooks from getting licenses. The way it’s currently worded, however, could lead to exclusion of popular operators like DraftKings and FanDuel.

DraftKings and FanDuel have offered daily fantasy contests in many states, including in places where the legality of such was disputed like Illinois. Technically, that could include them in this category of “accepting illegal wagers.”

Because of that, DraftKings and FanDuel might be ineligible. While that would be good news for other operators, it would exclude Tennessee from the resources those two companies would bring to the state.

All these issues and more can be addressed, however. Bringing them to the attention of the council will help that cause. Tennesseans now have more time to do exactly that.

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Derek Helling

Derek Helling is a lead writer for PlayUSA and the manager of BetHer. He is a 2013 graduate of the University of Iowa and covers the intersections of sports with business and the law.

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