Hawaii Sports Betting Bill Advances, but Casino Legislation Rejected

^{The Hawaii House of Representatives is still considering a bill to legalize online sports betting, but that legislation still has a ways to go before it gets to the floor. (Image: Audrey McAvoy / AP)}

Hawaii’s House Judiciary & Hawaiian Affairs Committee narrowly passed a bill that would allow for up to four online sportsbooks to operate in the state, though the close margin and reservations from committee members showed how controversial gambling remains there.

The legislation, known as House Bill 1308, moved forward on a 6-4 vote last week, with two of those voting to advance the bill noting that they had reservations.

Officials Share Concerns Over Large-Scale Gambling

Those supporting the bill pointed to the need for new revenue streams that could help offset a drop in funding from the federal government.

“In my career I have consistently voted against gambling,” Rep. David A. Tarnas (D-Kohala) said during the committee meeting. “I’m trying to be creative and move forward with legislation in a reasonable and deliberative way. I understand there are issues with this, but that’s my reason to move this forward.”

Several organizations spoke to exactly what the issues with regulated sports betting in Hawaii could be. The Department of the Prosecuting Attorney of the City and County of Honolulu submitted testimony opposing the bill, noting that while carveouts for poker nights and other social wagering options like Super Bowl pools allowed individuals to enjoy small bets with friends and family, allowing major operators to run full sportsbooks on the island would be a completely different matter.

“Once gambling starts to involve large scale operations, business corporations or other money-making entities, however, the department is extremely concerned about the known risks and societal costs associated with legalized gambling,” the department wrote in its testimony. “Our laws currently list ‘gambling’ within the definitions of ‘organized crime’ and ‘racketeering’ for good reason.”

The Department of Commerce and Consumer Affairs – which would regulate the sports betting sites if HB1308 becomes law – also came out against the legislation.

“The department’s mission is to protect consumers, promote fair competition, and foster a healthy and vibrant business environment in Hawaii,” department director Nadine Ando wrote in her testimony. “While we are charged with overseeing a wide array of industries, the introduction of regulating sports wagering presents unique challenges that may conflict with our existing mandate. Therefore, the department may not be suited to regulate this operation.”

Supporters Say Regulated Sites Could Help Players Avoid Black Market

The Sports Betting Alliance wrote testimony in favor of the legislation, as did DraftKings and BetMGM, all arguing that the bill would help prevent Hawaiians from playing on black market sites. That point was also made by Rep. Chris Todd (D-Kea’au), who sponsored the bill. 

“I think, generally speaking, the legislature is very good at anticipating future negative impacts but not great at taking a look at the current negative impacts that prohibition – not just on gambling, but on a variety of issues – currently has,” Todd said.

While the sports betting bill still has life, a bill that would have established a Hawaii Gaming Control Commission and legalized casino gambling in the state failed to move forward. The Senate Committee on Economic Development and Tourism indefinitely deferred Senate Bill 893 last week, effectively killing the bill for the current legislative session.

Hawaii is one of only two states in the United States of America that offers no forms of legalized gambling, with the other being Utah.