After Tennessee approved sports betting earlier this year, lawmakers now envision a gambling market that doesn’t necessarily center on sportsbooks. If things go according to plan, representatives will approve legislation that would allow online wagers without requiring a physical sportsbook, but they need input first. The Tennessee Lottery, which would oversee the sports gambling industry in the Volunteer State, published draft rules for the activity November 22 and is now waiting to hear what the public has to say.
Comments on the rules will be accepted for the next 30 days. Based on that feedback, the Lottery may forge ahead with the rules as written or change things around to incorporate some of the suggestions. The legal framework was published a day after Nashville hosted the first Sports Wagering Advisory Council for the Tennessee Lottery and all input will be discussed when the council meets again on January 14.
Tennessee is taking a more cautious approach to launching sports gambling than what has been seen in other states. Wanting to capture as much revenue from the activity as possible, many states moved quickly to approve and implement legislation; however, lawmakers in Tennessee want to be methodical and not rush into things.
Representative Rick Staples, who spearheaded the legislation to see legal sports wagers come to the state, believes that operators wanting to offer online wagering apps could start to be approved by late spring or early summer. He told Casino.org that the companies are going to be thoroughly vetted, which is going to take some time, and adds, We want to make sure that it’s about the quality of the product and not rushing for any particular reason. So, if we are going to be ahead of the game, if we’re going to show other states how to do it, we want to at least be able to do it right.”
Unless there are changes between now and the time the final rules are implemented, operating an online sportsbook in Tennessee won’t be cheap. The annual license fee is expected to run $750,000 and gross gaming revenue will be taxed at 20%. The money goes to a worthy cause, though, as 80% will be used for the Tennessee Lottery’s education fund, 15% to the state’s general fund and 5% to cover programs targeting problem gambling and addiction.
Where Tennessee also differs from other states is in the data used for oddsmakers. By law, all data must come from official league sources, which means the leagues are going to get the additional revenue stream they sought, even if it doesn’t come via the so-called integrity fee. Sports leagues are going to have to play nice with the sportsbooks, though, as the law is written in such a way as to allow exemptions from this requirement if the leagues aren’t willing to offer the information at “commercially reasonable terms.”
