Supporters of statewide mobile sports betting in the Magnolia State are dangling a $6-million carrot in front of Mississippi’s brick-and-mortar casino operators.
A substitute version of House Bill 1302, the "Mississippi Mobile Sports Wagering Act," was passed by the Mississippi House of Representatives’ Gaming Committee on Wednesday, and the latest edition includes some generosity for those who don’t want to participate.
The original H.B. 1302 – authored by Republican Rep. Casey Eure and Democratic Rep. Jeffrey Hulum III – would have legalized online racebooks and sportsbooks in Mississippi for those 21 and older.
Their substitute will do the same, but it would also create the "Retail Sports Wagering Protection Fund."
Into that fund will go the first $6 million of mobile sports wagering tax revenue every year until July 2030.
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At the end of every calendar year, any licensed casino that is without an online betting platform and whose total sports wagering revenue has dipped below what it was in 2024 can apply for money from the fund.
“The [Mississippi Gaming Commission] shall allocate funds in the Retail Sports Wagering Protection Fund proportionately among eligible applicants, but in no case shall a licensed gaming establishment without a platform receive more funds than the amount of the difference between its current year retail sports wagering revenue and 2024 sports wagering revenue,” the bill states.
A fund designed to top up casinos that have taken a hit from statewide mobile wagering is easy to read as a way to ease the concerns of brick-and-mortar operators worried about what it may mean for their bottom lines if sports bettors can bypass them altogether.
Sports betting is legal in Mississippi at physical casino properties, but the statewide mobile version authorized in more than 30 jurisdictions around the U.S. is not.
There was momentum last year for legalizing online sports betting in Mississippi, yet a bill that cleared the House stalled in the Senate and then died in a conference committee. One obstacle in the way of legalization was those lingering fears about the potential effect on Mississippi's brick-and-mortar casinos.
Well, looks like the best shot at legalizing statewide online sports betting in Mississippi this year is dead, as lawmakers failed to reach a compromise on House Bill 774 before Monday's deadline:https://t.co/oMu6pmMe00 pic.twitter.com/AIO20XSeIj
— Geoff Zochodne (@GeoffZochodne) April 30, 2024
It remains to be seen if H.B. 1302 and its funding promises will persuade casino operators. However, it represents an effort to at least try to persuade them, which could help in the legislature. The bill will now head to the House floor for consideration.
There are other provisions in the bill that may meet with the approval of brick-and-mortar entities, such as a requirement to "tether" online sports betting licenses to casinos. H.B. 1302 also makes clear that it does not authorize online casino gambling in the state, another fear of brick-and-mortar operators.
“I would like to start by saying I’m committed to the bricks-and-mortar casinos and this bill mandates that all sports betting is tethered to bricks-and-mortar casinos,” Eure reportedly said this past week.
According to the legislation, operators of online sports and horse race betting sites would have to partner with a licensed casino operator in Mississippi and receive a manufacturer's and distributor's license from the state gaming commission. Casinos could enter into contracts with up to two mobile operators for wagering on both sports and horse racing.
The bill also requires online operators to engage in “good-faith discussions” with licensed casino operators if a request to partner is made.
If passed, H.B. 1302 would require the gaming commission to set a “universal start date” for all licensed online sports betting sites in Mississippi, which could be no later than Dec. 8, 2025.
Online sports betting revenue would be lumped in with casino revenue and subject to the same tax structure, starting with a 4% levy on gross monthly receipts below $50,000 and reaching as high as 8% on monthly receipts over $134,000. Local taxes could bump the rate up as high as 12%. Application fees for the manufacturer and distributor licenses are a combined $1,500 annually.
Tax revenue collected by the state from online sports betting (and not flowing to brick-and-mortar casinos) would go to its Emergency Road and Bridge Repair Fund.
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H.B. 1302 is not the only online sports betting bill that's been introduced in the Mississippi legislature, but it is the only one that's made progress this session.
House Bill 682 was likewise introduced in January, albeit by Democratic Rep. Cedric Burnett. It was referred to the House Gaming Committee as well but has not budged since.
