Tennessee sports betting’s future regulatory body, the Sports Wagering Advisory Council, convened Tuesday, Aug. 24 for its monthly meeting.
The council discussed July sports betting revenue and advanced its process of establishing revised sports betting regulations for 2022.
The council also provided updates on where license approvals stand for operators, suppliers, and vendors.
July sports betting revenue holds steady in Tennessee
The day’s agenda began with an update from the Tennessee Education Lottery (TEL).
Vice President Alonda McCutcheon announced the state’s sports betting numbers for July.
Bettors wagered slightly less than $135 million during the month. It was a big decrease from June’s $174 million, and is the lowest amount of handle since betting began in November.
However, the July slump is fairly standard for sportsbooks across the country. Backing out pandemic-altered betting numbers in 2020, July was the lowest-volume betting month in both 2018 and 2019 in the US.
Although betting volume was low, Tennessee sports betting revenue for operators remained high. Tennessee’s betting apps secured $15.2 million in revenue last month.
Things will likely begin to rebound as we near the start of the NFL season.
Updates from last week’s Sports Wagering Committee meeting
McCutcheon continued by discussing noteworthy points from the TEL’s Sports Wagering Committee meeting on Aug. 18, including operator infractions and updates on new license approvals.
Operators face fines for various Tennessee sports betting infractions
During last week’s meeting, the committee cited five out of Tennessee’s seven sportsbooks for various infractions.
The TEL sent a warning letter to Action 24/7 for failure to obtain prior approval for voiding wagers.
FanDuel also received a warning letter for permitting a player to set up multiple accounts on its platform.
The committee issued DraftKings a warning for offering wagers on an unapproved Australian football event, bringing in $11.10 in illegal wagers. Additionally, the sportsbook faces a $3,000 fine for accepting over $16,000 in prop wagers on college baseball.
Moreover, the committee recommended a fine of $2,500 for DraftKings accepting gift cards as a means of funding accounts. While this would generally be a $5,000 fine, the recommendation was reduced to $2,500.
The TEL Board recently voted to permit prepaid cards and gift cards as funding methods, however, they were not approved at the time of the infraction.
William Hill (Caesars) faces a $2,500 fine for accepting $4,000 in unapproved prop wagers on collegiate sporting events.
The committee also recommended a $5,000 fine for TwinSpires after the sportsbook accepted credit card deposits as a means of funding. Credit card deposits are expressly prohibited for Tennessee sports betting.
In the spirit of due process, the TEL has yet to impose fines on these operators. If an operator doesn’t file an appeal during the notice period, the TEL then considers the decision effective and issues a fine.
New vendors and suppliers get approval, operators still waiting
The committee also approved supplier applications for IMG Arena and SG Gaming.
The group approved 48 vendor applications as well. Marketing affiliates make up 39 of these vendors, while others include accounting firms, prepaid card companies, and ID verification brands.
The committee will hold a subsequent meeting on Tuesday, Aug. 31 in hopes of approving two operators and at least one supplier.
Rulemaking Committee reports proposed regulation updates
The meeting continued with an update from council member Tom Lee on the Rulemaking Committee’s progress regarding new permanent Tennessee sports betting regulations that will take effect next year.
Lee presented the committee’s suggestions, which were finalized during a meeting on Wednesday, Aug. 18.
He stressed the importance of creating an open, transparent rulemaking process that welcomes ample engagement and input from stakeholders.
Lee explained that the rule recommendations covered five primary topics:
- The proper mode of registration for suppliers and vendors, including the appropriate scrutiny required before, during, and after the application process.
- The definition of sports betting’s governing body and its role in the industry.
- Tennessee’s online-only sports betting structure and how it relates to operators partnering with sports bars to offer in-person wagering incentives to customers.
- Means of funding an online sports betting account and potential issues that arise with introducing new deposit methods.
- Definitions of key sports betting terms including parlays, prop betting, and teasers.
Lee ended the meeting by scheduling a public comment period for these new rule suggestions. It will start during the committee’s next meeting on Tuesday, Oct. 5 at 11 a.m. CT.
He also wants to create an online portal for the public to submit written suggestions.
The Rulemaking Committee will meet again after the conclusion of the public comment period to create a final version of the rules. Lee and his team will then submit these rules to the SWAC at the end of November.
In the meantime, the SWAC’s forward momentum continues. The Attorney General’s office is building an SWAC website where interested parties can access rules, agendas, minutes, and the like.
The council will also receive additional office space and new email addresses.