In late April, a new legislative proposal known as the Senate Bill 948 (SB 948) was introduced, proposing the authorization of online gambling, or iGaming, for eligible Rhode Island patrons. If sanctioned, the bill is projected to come into force on January 1, 2024.
During a recent Wednesday review of SB 948, the Sports Betting Alliance (SBA), an amalgamation of major players in the gaming and entertainment industry, communicated their approval for the initiation of a competitive online gambling landscape in Rhode Island, according to a privileged statement received by GamblingNews. With notable members such as FanDuel, DraftKings, Fanatics and BetMGM, the SBA advised Rhode Island legislators to contemplate amendments to the proposed law to foster a competitive iGaming arena.
Jon Mandel, a legal professional with the renowned legal firm Orrick, Herrington & Sutcliffe, which serves as the national public policy counsel for the SBA, presented compelling data supporting the formation of a competitive market in the state along with the advantages such a market can yield. He expounded that although SBA’s member organizations are rivals in different markets, they uniformly strive to collaborate with policymakers and stakeholders to devise secure and prosperous gaming markets through effective legislation and regulation.
“We propose that the legislature revises Senate Bill 948 to enable a competitive iGaming landscape for two key reasons,”
stated the Sports Betting Alliance at SB 948’s recent hearing
Profit from A Competitive Market
Mandel delineated two major justifications for Rhode Island to set up a competitive iGaming arena by amending SB 948. He elaborated that vigorous rivalry, implying the presence of multiple operators, can lead to higher tax proceeds.
Simultaneously, Mandel indicated that a competitive iGaming market in Rhode Island can present an abundance of online gambling alternatives for the locals. This is predicted to diminish the proportion of customers opting for iGaming activities through unauthorized operators.
“Establishing a system with multiple operators will aid Rhode Island in realizing its full potential and bolster crucial public initiatives, by extending a safe and convenient avenue for consumers to participate in iGaming, implementing essential responsible gaming tools, and generating substantial annual tax revenue for the State.”
Added the SBA
Backing up each of these claims, Mandel referred to a 2022 study by Light & Wonder, suggesting that the state can potentially amass about $24 million in tax revenue in the initial year of authorized online gambling, if a 20% tax rate is imposed. The same study acknowledged that Delaware, where an iGaming monopoly reigns, “significantly lags behind others states with iGaming in terms of revenue.”
On the contrary, healthy rivalry with various online gambling operators “is vital to draw users away from the ubiquitous illegal, offshore market,” Mandel further added. He noted that customers who can choose from different legal iGaming operators gain certain advantages. This is due to the fact that licensed and legal gaming operators comply with regulations, pay taxes, and also offer responsible gambling choices, privileges that definitely do not extend to the unauthorized gambling market.
