Hawaii residents may soon be riding the wave of sports betting, and potentially poker, soon.
The House Committee on Economic Development moved a proposal (House Bill 2765) forward that would allow sports betting in Hawaii with a vote of 5-2.
This is significant because it’s common for lawmakers to introduce sports betting bills each year. After all, Hawaii is one of only two states in the country that doesn’t have legal gambling— no lotteries, casinos, or sportsbooks.
However, since 2019, the issue hasn’t made much progress, with only two bills moving through committees. So, this latest bill is already gaining traction.
The legislation must now go through the Consumer Protection and Commerce, Judiciary and Hawaiian Affairs, and Finance committees before March 7th, which is the deadline to transfer to the Senate.
What Does House Bill 2765 Allow?
The legislation allows for the licensing of multiple operators within the Aloha State, provided they are already operational in at least three other states. However, the exact cost of obtaining a license remains undisclosed.
If it passes, it would regulate online sports betting in Hawaii and set the minimum betting age at 18 years old.
Where Would the Tax Money Go?
The committee proposed using the tax money earned from sports betting differently. Instead of going into the general fund, they suggested putting it into a special fund managed by Hawaii’s Department of Law Enforcement. This money would then be used specifically to fight against unregulated gambling, including both in-person and online betting.
In addition to other allocations, some funds will be dedicated to establishing a gambling mitigation program in Hawaii—an initiative that currently does not exist in the state.
While the proposed tax rate for wagering activities is still undetermined, the legislation estimates that the state could generate approximately $9 million in annual sports betting tax revenue. This projection is based on the assumption that prominent online sportsbooks such as DraftKings, FanDuel, and BetMGM will apply for and receive approval for betting licenses.
Poker Bill Also Under Consideration
In the meantime, across the aisle, State Senator Ronald D. Kouchi is proposing Senate Bill 3376. This bill is also designed to make Hawaii a place where people can enjoy sports betting, but adds poker, too.
The legislation would establish the Hawaii Gaming Control Commission to oversee it all.
Tax Money Would Go To a Wildfire Fund
SB 3376 is a bit different because it suggests using the money earned from betting to support a wildfire relief fund. The fund would help offset the economic losses caused by wildfires in Hawaii, which amounted to about $6 billion last year.
The tax revenue generated would also go to tackling unregulated gambling, which lawmakers believe already involves thousands of Hawaii residents. SB 3376 also proposes a compulsive gambler assistance program for Hawaii residents.
The Sports Betting Alliance estimates that legalizing and regulating sports betting in Hawaii could yield approximately $7 million in annual tax revenue. Under SB 3376, the proposed tax rate for the initial year of wagering is 70%, gradually decreasing by 5% in subsequent years.
Prospective operators would also have to pay a $50,000 application fee.
What’s Next For The Hawaii Gambling Bills?
The bill passed its first reading, so it too, appears to be getting some traction. Whatever the case, it appears that both bills are off to a good start.
Now we’ll wait to see if one can make it through, or if we’ll say “Aloha” to both.
