Arizona Sports Betting Regulations Move One Step Closer To Finalization

Posted By Derek Helling on June 23, 2021 - Last Updated on June 30, 2021

To stay on track for a September 9 launch of retail sports betting in Arizona, the AZ Dept. of Gaming (ADG) needed its first public comment period on draft Arizona sports betting regulations to accomplish two goals. Now that the period is over, it appears that the department got all it needed.

Industry stakeholders provided feedback on items the regulators left up for discussion in their first draft of the state’s rules. They also got those crucial reactions within the time allotted. Both of those things are good signs for interested bettors in AZ.

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Arizona sports betting regulations set for a new draft

The AZ Dept. of Gaming not only accepted comments online but held several public hearings allowing interested parties to comment on its first draft of the rules. It was fishing for comments on a few items the department intentionally excluded from specifying policy on. That included:

  • Fees for the acquisition and renewal of event wagering operator and managed services provider licenses
  • Number of online skins for each licensee
  • Procedure for distributing sports betting licenses among tribal casino operators
  • The tax rate(s) for sports betting revenue
  • Whether to require sportsbooks to use “official” data to settle bets

ADG Director Ted Vogt said that a prohibitive license fee schedule and tax rates will be part of an updated draft. It also seems that potential AZ licensees are unified in their desires for the number of online skins. It isn’t difficult to understand why.

Potential licensees prefer a single-skin framework

Among those who shared their preferences on the issue of how many managed service providers a single event wagering operator could contract with were several industry newbies and veterans. Represented were:

  • the Arizona Coyotes
  • the Arizona Diamondbacks
  • Caesars
  • FanDuel Sportsbook
  • NASCAR
  • PGA TOUR
  • Sportradar

The consensus was that a single-skin structure is preferable. While that may mean less upfront revenue for licensees, it also makes those licenses more valuable. For example, the Coyotes still haven’t announced a sports betting partner. If AZ only allows a single skin for the NHL franchise, it can demand more for that distinction.

Additionally, it ensures those partners of primary exposure to fans at venues. For DraftKings Sportsbook, for instance, being the only service provider for TPC Scottsdale will mean it is the only brand that visitors to the course will see promotional materials for. Other potential opportunities for DraftKings’ competitors besides the Coyotes who aren’t yet in the market include:

  • Arizona Cardinals
  • Phoenix Mercury
  • Phoenix Raceway

With a new draft out in days, these parties will soon see whether the department intends to grant their wish. If that isn’t the case, though, they will still have time to do some additional lobbying of the regulators.

So, what happens now?

The department will now gather, update the regulations, and publish a new draft. Once that’s live, Vogt says there will be another but shorter public comment period. That will likely be the final opportunity for interested parties before the rules become final.

Given the current pace, that means the process of drafting regulations could be finished early in July. With licensing procedures set, regulators could then work on getting application forms out. From there, it’d be a matter of reviewing applications and inspecting systems.

Again, at the current pace, that’s completely doable in time to get brick-and-mortar sportsbooks live by Sept. 9. Just over two months ago, the entire idea of legal sports betting in AZ was merely a legislative proposal. Barring any unforeseen snags, AZ bettors should be able to welcome the next NFL season with legal bets.

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Derek Helling

Derek Helling is a freelance journalist who resides in Chicago. He is a 2013 graduate of the University of Iowa and covers the intersections of sports with business and the law.

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