Despite an 18-day hiatus in which they sat in the Governor’s Office, emergency rules to authorize sports betting at the state’s five casinos are back on pace for the facilities to start taking bets on football games this September, officials said.
“I look for the sportsbooks at the brick-and-mortar sites to be in place by the first week of September, the first weekend for the NFL season,” said John Cavacini, president of the West Virginia Gaming and Racing Association, which represents the state’s racetrack casinos.
Cavacini said Monday that the casinos lost time between when the Lottery Commission approved emergency rules for sports betting on June 21, and when the rules reached the Secretary of State’s Office on July 9.
The delay occurred while the Governor’s Office reviewed — but did not make any changes to — the proposed emergency rules.
Gov. Jim Justice sparked controversy after the bill legalizing sports betting had passed the Legislature — contingent on a favorable U.S. Supreme Court decision, which came in May — by advocating for adding integrity fees to be paid to professional sports leagues, event though the Legislature had soundly rejected such fees.
“That put us behind the 8-ball because none of the tracks were going to sign contracts for sportsbook vendors or invest in construction until the rules were filed,” Cavacini said of the delay in filing the emergency rule.
Cavacini said the casinos now have either signed contracts with vendors to operate sports betting at their locations or are negotiating those contracts.
While the Lottery rules set down specifications for sportsbooks — lounges within the casino featuring betting windows and displays showing sporting events and odds — it also allows casinos to set up temporary locations for those lounges for up to nine months.
The next step in the process will be for the Lottery Commission to begin licensing casinos, as well as the independent contractors, to offer sports betting.
Lottery counsel Danielle Boyd said the application forms for interim licenses should be available by mid-week.
“We’d like to start issuing these interim licenses ASAP,” she said. “We’re still hoping to have them up and running by Sept. 1.”
For casinos, the sports betting licenses have an annual fee of $100,000.
The Lottery and the industry still hope to launch sports betting at the casinos by the start of football season. However, Boyd said provisions in the law allowing casinos to offer sports betting via online and mobile apps most likely won’t be ready in September.
Besides licensing the vendors for the mobile apps, those systems will require additional testing to ensure that required functions, such as a geo-location system, which would verify that individuals are within West Virginia’s border when they place bets, are working properly.
Boyd said the Lottery also is working with counterparts in Nevada, New Jersey, Delaware and Mississippi to enter into memoranda of understanding for integrity monitoring so that the states will share information about any unusual or suspicious sports betting activity.
The Lottery’s emergency rules require casinos to notify the Lottery and each other of any unusual betting patterns or activity.
Despite the brief setback in getting the emergency rules filed with the secretary of state, Cavacini said he’s optimistic that state casinos will have a monopoly in the region on sports betting for at least a year or two.
“Our contiguous states, with the exception of Pennsylvania haven’t passed sports betting laws, and Pennsylvania passed a law with a 36 percent tax rate,” he said.
Gaming industry experts have said Pennsylvania’s exorbitant rates, including the high tax (West Virginia has a 10 percent tax) and $10 million annual licensing fee, makes sports betting unviable for casinos there and, to date, none have moved forward with sports betting.
“We believe we have a chance to really stand out, as it relates to sports betting,” he said of the state casinos’ ability to offer a gaming alternative not available at competing casinos in Ohio, Pennsylvania or Maryland.