WA Sports Betting Launch To Be A Slow Grind WSGC Director Explains

• Washington legalized Tribal sports betting in March of 2020 and have now started the process of coming up with a structure to their launch their industry.
• The Evergreen State is hopeful that wagering on sporting events will be open to the public in 2021.

OLYMPIA, Wash. – What is the status of launching the Washington sports betting industry? Dave Trujillo, the Director of the Washington State Gambling Commission (WSGC) spoke with LegalSportsBetting (LSB) on Friday to discuss the status of sports betting within the Evergreen State.

There are a number of factors that have to go into regulating the market in order for it to launch as it’s a different ballpark than that of what’s been seen with many other states across the nation.

Washington has to go through Tribal Gaming Compacts and come to an agreement with the Tribes that will be offering legal sports betting prior to any public rollout.

They are home to 29 Tribes, each with the right to their own individual negotiation process.

What’s Happening In Washington?

Washington has a long list of channels it needs to go through before sports betting will become available in the state. Its landscape is unlike that of any other state within the U.S. when it comes to matters such as these and Dave Trujillo helped shed some light on the process.

“One of the things that is interesting is that as other states have enacted sports wagering, they’ve put a lot of thought into what goes into the state statute, what goes into the state rules, right? Our state didn’t do that. They basically said we’ve created a sports wagering statute with the details to be worked out through the compacting process,” said Trujillo. “This makes it a little bit more difficult because at some point, a public process will end up having to merge with the confidential negotiation process and it’s all timing. Its dominoes; dominoes being lined up so that dominoes fall correctly. The sooner that the public process can occur the sooner sports wagering in Washington can be implemented. The longer that takes to get to that point, then the farther along the process will take.”

Four of the 29 Tribes in the state have put in their requests for sports betting compacts. They are the Kalispel Tribe, the Suquamish Tribe, the Tulalip Tribe, and the Snoqualmie Tribe.

According to Trujillo, two of these Tribes have said they have multiple Tribes behind them that they would likely represent when coming to a final agreement which would make the process move faster if that’s indeed the case.

“Before we even received our first negotiation request, we knew that several of the Tribes wanted to give the authority to one or two Tribes to act as point and then once that negotiation was concluded, other Tribes would jump on but that really didn’t happen,” said Trujillo.

 

“The current legislation has pushed it all back to the compact negotiating process, so with limited times we’ve got at least, right now, four open negotiations with individual Tribes for sports wagering. Our goal is to have a model that other Tribes could incorporate through a most favored-nation’s (MFN) clause, but I’m not quite sure how that will work because we are in the middle of these individual negotiations.”

Tribal negotiations are only one piece of the puzzle to get the industry off of the ground. In fact, it’s a three-piece convergence in its final form but it’s getting to that endpoint of converging ideas that could prove to be a long and arduous path to launching legal sports betting in Washington.

“It’s a little bit difficult because the Tribes want something unique for their compact, so we’ve got this confidential individual negotiation process and we also know that at some point we are going to have to develop rules that will go through the public process. So, at the same time you’ve got the individual confidential negotiations and a public rules process and then in between both of those things, we’ve got what they call a government to government relationship. This is an obligation for us to meet periodically or consult with Tribal leaders for things that we think are going to impact the actions that we’re working on that would impact Tribes. Three different pathways, three different sets of rules, and at some point, they all need to converge but we’re not there yet.”

The WSGC would like to have a model similar to Appendix X from 1999 which had Tribes come together through one document that would later get their gaming industries up and running. Having all the Tribes agree to similar terms within the model created a smoother process and a much quicker one at that. Trujillo gave a great example breakdown of what needs to happen for Washington for sports betting to begin.

“If two entities are in negotiations for a sports wagering compact or any compact, they would go back and forth, eventually coming to an agreement. That would be called a tentative agreement. Once that tentative agreement goes into play, that will then trigger timelines. One of those timelines is to publicly notice the gambling commission and the legislature that this agreement is in place and that tentative language has been agreed upon. Then the legislature has so many days to hold a public hearing and the gambling commission has so many days to hold a public hearing and then the gambling commission will vote to either send it to the Governor with a recommendation to sign or refer it back to me for further negotiations. If they forwarded it off to the Governor’s office, the Governor reviews it, considers it, signs it, and then it would go off to the Tribal leaders’ for a signature process as well. There is a signature gathering timeframe. Once all signatures are on the original document then the document gets sent back to the Department of Interior and will then enter the Department of Interior’s review process. After that, it can be published in the Federal Register and will then be effective as law.”

In the very best of situations, the above example would take six months. And that’s without hitting any snags in the road along the way.

But with a topic like sports betting, snags are to be expected. Trujillo believes that coming up with an appendix will be a standard that negotiations could work from to get sports wagering within Tribal Compacts done in a much easier fashion.

Presently though, there is no standard or model set up to create ideas from and he is unsure of when this could happen.

“We have great hope that as individual negotiations progress that at some point they will converge and we will have a model compact, a model appendix, that is our great hope,” said Trujillo.

One of the things on the table during the negotiation process is mobile sports betting. As the statute did not specify it, it can be discussed with the Tribes that are in negotiations.

At 7 Cedars Casino and Resort, CEO Jerry Allen of the Jamestown S’Klallam Tribe told LSB that he would like to offer mobile sports betting. His Tribe has not yet made a request for sports wagering with the WSGC.

What’s Next?

While the Tribes wanted to get sports betting within their establishments as soon as possible, that didn’t happen. Instead, the Coronavirus pandemic took center stage at about the time that sports betting was made legal.

“There was great anticipation by Tribes that a launch of the industry could be in time for various sports seasons beginning in 2021. We know that during the compact negotiation process that it does take time and part of that time is outside of our control,” said Trujillo. “I think 2021 is a fair assessment, granted it’s probably not going to be early 2021 but I think 2021 is fair to say.”

And as far as commercial sports betting being considered as well, that wasn’t part of the legislation that was passed. However, Trujillo thinks that there was a lot of interest from other businesses to enter sports betting during this past session. Because of that, he believes it’s something that could be seen in the future.

“For now the legislature has spoken and what they’ve said is they’re okay with sports wagering but we want it placed on Indian lands, whether or not there is going to be any more legislation this upcoming year, I don’t know, I have the tendency to think so because I think there are other interests out there that would like to have sports betting off of Indian country but I don’t know how that’s going to go,” said Trujillo.

As far as revenue is concerned, Washington does not expect to see any. They are not a state that is in the sports betting business to collect revenue. Instead, they opt to be paid for their regulatory services and that’s it.

“Our state is a little bit different from most other states, especially if sports wagering is handled by a lottery organization. In our state, we actually have no interest in revenue. Our regulatory purpose really is regulation, there is no reason for us, the state gambling commission, to ensure the state gets anything out of it other than what the Indian Gaming Regulatory Act says. It states we should be reimbursed for our direct and reasonable costs of the regulation and that’s generally all that we as a state agency are trying to get. It’s just to pay for our cost of the act of regulation,” said Trujillo.

Although there is plenty that needs to be discussed, the wheels for a sports betting industry in Washington have been set into motion.

The WSGC meets monthly to talk about the issues at hand and the public has access to view or read transcripts of these sessions to see what’s being talked about as far as sports wagering is concerned.

Commission meetings are done monthly, generally the second or third Thursday of the month, with the next one being held on September 10.

News tags: 7 Cedars Casino and Resort | Appendix X | COID-19 | Coronavirus | Dave Trujillo | David Trujillo | Indian Gaming Regulatory Act | Jamestown S’Klallam Tribe | Jerry Allen | Kalispel Tribe | Snoqualmie Tribe | Suquamish Tribe | Tulalip Tribe | Washington | Washington State Gambling Commission | WSGC