US Legislators Developing Model Legislation for Legal iGaming

US Legislators Crafting Model Legislation to Legalize iGaming

The future of online gambling in the US is about to undergo a significant transformation!

US legislators are crafting model legislation to pave the way for legal iGaming across the nation.

Discover how this initiative will streamline the legalization process and impact the gambling industry.

Stay updated on the developments and be prepared for the new wave of iGaming regulations.

US Legislators Crafting Model Legislation to Legalize iGaming

In a groundbreaking move, the National Council of Legislators from Gaming States (NCLGS) is developing model legislation to facilitate the legalization of online gambling across the United States. This initiative aims to provide lawmakers with a comprehensive framework to introduce and advance online gambling bills in their respective states starting in 2025.

Preparing Lawmakers for the Future

The project, in the works for several months, was highlighted last week at an NCLGS meeting in Pittsburgh. Former Florida State Senator Steve Geller outlined the anticipated components of the model iGaming legislation, engaging regulators and stakeholders in a detailed discussion about priorities and potential impacts.

Key Provisions of the Model Legislation

The draft model legislation proposes a 15-25% tax rate, aligning with the average iGaming tax rate of 19% in the seven US states where online gambling is currently legal. Beyond tax rates, the legislation aims to address seven critical areas:

1. Revenue Generation: Ensuring that iGaming contributes significantly to state revenues.
2. Responsible Gaming: Implementing measures to protect players from gambling addiction.
3. The Cannibalization Question: Addressing concerns that online gambling may detract from brick-and-mortar casino revenues.
4. Advertising Guidelines: Establishing rules for responsible and targeted advertising.
5. Licensing: Creating a transparent and rigorous licensing process for operators.
6. Age Limits: Enforcing strict age verification to prevent underage gambling.
7. Data Sharing: Promoting data sharing to enhance regulatory oversight and player protection.

Timeline and Public Involvement

NCLGS President Shawn Fluharty announced that a draft of the legislation would be released to NCLGS members by August 1. This draft will then be open for public comment for 30 days. Lawmakers will consider these comments and make necessary revisions before presenting a final version at the NCLGS meeting in New Orleans from December 12-15.

“We’re trying to have a foundation that will work in most any state,” said Fluharty, a state representative from West Virginia. This approach aims to create a versatile and effective framework that can be adapted to various state-specific requirements.

The Current Landscape and Challenges

Since the US Supreme Court overturned the Professional and Amateur Sports Protection Act in 2018, nearly 40 states have legalized some form of sports betting. However, only seven states currently permit legal iGaming: Connecticut, Delaware, Michigan, New Jersey, Pennsylvania, Rhode Island, and West Virginia.

Lee Copella, iGaming compliance director at the Pennsylvania Gaming Control Board, emphasized the distinct differences between online gambling and sports betting. “It’s a different audience,” Copella said. “Sports betting is more of an amenity, while online casinos have more consistent revenue streams.”

Lessons from Maryland

Maryland State Senator Ronald Watson shared insights from his efforts to legalize iGaming in his state. He stressed the importance of educating both lawmakers and the public about the benefits and safeguards of legal online gambling. Watson noted that successful legislation often requires a comprehensive campaign and broad support from various stakeholders.

Financial Incentives

Stakeholders are optimistic that the financial landscape in 2025 will be conducive to advancing iGaming legislation. The expiration of COVID funding in many states could create an urgent need for new revenue sources. Tax revenue from online gambling is significantly higher than that from sports betting, which may drive more states to consider legalization.

Expert Insights and Industry Perspectives

Howard Glaser, director of government affairs at Light & Wonder, underscored the importance of anti-money laundering (AML) measures in iGaming legislation. “The US has become the ATM for money laundering worldwide to fund terrorism,” Glaser said, highlighting the need for robust regulatory tools to combat illicit activities.

Addressing Cannibalization Concerns

Bill Pascrell III of the Princeton Group addressed the long-standing fear that online gambling could cannibalize brick-and-mortar casino revenues. He argued that data from New Jersey shows no significant impact on physical casinos. Instead, offering both online and offline options can lead to increased overall revenue.

Conclusion

The NCLGS’s efforts to craft model iGaming legislation represent a pivotal step towards expanding legal online gambling in the US. By providing a comprehensive and adaptable framework, this initiative aims to streamline the legalization process and ensure robust regulatory oversight. As the draft legislation progresses, stakeholders and industry participants must stay engaged and informed to navigate the evolving landscape of iGaming in the United States.