South Dakota Stalls on Legal Sports Betting, While the North Makes Progress.

South Dakota has taken another step towards legalizing sports betting apps within casino limits in Deadwood. However, the two proposals which would have allowed mobile sports betting have stalled.

Facing several concerns that include constitution wording and the impact on local business, both proposals were defeated by the committee members. Regardless, the state will add in-person sports betting to the ballot in November 2022. It is a step in the right direction.

South Dakota Makes Small Steps toward Legal Sports Betting

Voters overwhelmingly approved legal South Dakota gambling on last year’s ballot. In response, State lawmakers have heard sports betting legislation testimonies. It’s the start of a long journey to introduce sportsbooks across the state. Officials will have to work through regulatory details, including tax rates and eligible bets. They will also consider state-wide mobile access. 

The proposed bill will allow South Dakota sports betting in many forms, including retail sportsbooks, betting kiosks and online gambling. If passed, the bill will also permit sports betting exclusively within the casinos in the city of Deadwood. The original bill stipulated that any wagering had to be ‘within the interior’. But the committee has now changed this to ‘on the casino premises’. It still limits bettors, allowing them to place wagers within the property lines of any of the 24 casinos with Deadwood city limits.

Both commercial and tribal South Dakota gambling stakeholders testified for bill SB 44 at the hearing. Retail sportsbooks would be another way to attract in-person gambling to the casinos. It would also mean introducing players to other forms of gambling, including slots and table games.

Two separate bills have been introduced to allow South Dakota online gambling. However, both came to a standstill and have been rejected for now. It signals the end to South Dakota’s plans for online sports betting apps for the near future.

On-Site Wagering Requirements

In-person attendance will be a requirement for South Dakota gambling. Deputy Secretary David Wiest has made clear his beliefs that the market ballots mean that sports betting should be in Deadwood city limits.

“We believe it’s clear that the phrase ‘within the city limits of Deadwood’ means that you should be physically present in Deadwood to play limited card games, slots, craps, roulette or keno, or to place a wager on a sporting event,” Wiest said.

The bill will ban betting on sports involving South Dakota colleges and various college prop bets are not being allowed under the current legislation. The proposed tax revenue is 9%, set to go to Deadwood.

Representative Mark Willadsen, however, proposed HB 1211. He wanted to let any establishment access South Dakota online gambling and sports betting specifically. Willadsen would stipulate that each licensed establishment must have a state license to sell alcohol for on-site consumption and a contract with a Deadwood casino and kiosk for the actual betting.

However Weist has stated that his department still backs SB 44, which will require betting on the casino premises. The House State Affairs Committee voted 9-4 against Willadsen’s proposal.

South Dakota Stalls Betting Legalization Efforts

Despite moving forward with regulations for sports betting, they will not include mobile sports betting for now. “Technology does not change the words of the Constitution,” said Wiest. “The proponents of the internet betting legislation want the legislature to expand the exemption for sports wagering state-wide without asking the voters on another constitutional amendment.”

The South Dakota House Taxation Committee voted 11-1 against HB 1231. The bill introduced by Rep. Tom Pischke would have allowed South Dakota online gambling, including sports betting within the state. According to this bill, bets still need to be processed by the Deadwood casinos.

The committee members, however, pointed to the state’s constitution. Claiming it has to be specific and say legal South Dakota gambling must take place ‘within the city limits of Deadwood.’

“I think we are going against what the public voted for when it was voted,” said Representative (R) Tim Goodwin of rural Rapid City. “If we want this to become state-wide,” said Parade Representative (D) Oren Lesmeister, “we need to take it back to the voters.”

However, the state constitution limits mobile sports betting to Deadwood, and the nine tribal casinos will offer South Dakota online gambling. Only if SB 44 becomes law.

One of the prominent supporters of mobile sports betting during the hearing was the Dakota Gaming Group. Group member Garrett Gross thinks that over $30 million per month, was wagered by South Dakota residents in neighboring Iowa casinos.

There is Still Optimism for South Dakota

The lack of support for South Dakota online gambling is just a bump in the road. There may not be mobile sports betting, but the state will see sportsbook in its Deadwood casinos. Support for legislation from the Deadwood Gaming Association is well documented, and SB 44 was approved by the Senate earlier this month. It is now heading to South Dakota Gov. Kirsti Noem to be signed into law. It is the first piece of South Dakota online gambling legislation in 2021.

North Dakota Moves Forward with Gambling Legislation Efforts

With South Dakota gambling taking a hit, its’ northern neighbor has taken a step forward. North Dakota gambling could change with an expansion into online sports betting and online poker.

Two resolutions were passed by the North Dakota House of Representatives. They both place legalized sports betting and online poker on the ballot for November 2022. In the absence of land-based casinos, all North Dakota gambling would be online.

Representative Jim Kasper (R) has been pushing online poker in the legislature since 2005. “Sixteen years!” Kasper exclaimed in an interview with the Associated Press.

The opposition to online gambling has softened in the past two decades. The opponents argue the expansion would add to gambling addiction issues. However, backers believe it would be a new way to bring revenue for the state and charitable institutions.

Sports betting

House members supported House Concurrent Resolution 3032 with a 70-24 vote. It gives the voters in North Dakota the power to legalize sports betting apps. The bill will go on the ballot in the November 2022 election.

If approved, the details of the North Dakota gambling will be governed by House Bill 1234. It is a framework bill that will establish a five-member commission. The measure will sit with the North Dakota Attorney General’s office and regulate sports betting within the state. “If we allow people to vote on it, we put this to rest once and for all,” said Representative Rick Becker Bismarck (R).

North Dakota Online Poker

Another measure that is being pushed in the state is House Concurrent Resolution 3012, which will add the legalization of online poker to the same ballot. It was already cleared with a 54-40 vote. “Thousands of people in North Dakota play poker online. It’s not regulated; it’s not taxed,” Jim Kasper said. After 16 years of pushing the legislation, he celebrated the win. The gambling industry would be governed by House Bill 1389.

Tribal gaming

Despite both Democratic and Republican lawmakers speaking in favor of the bill, House Bill 1448 was defeated. It would have authorized North Dakota’s five tribal nations to discuss agreements that would have legalized sports betting and online gambling on tribal lands. This would have been dependant on approval of the ballot measures.

However, Kasper was concerned about the wording of the bill. He worried it could limit online gambling to tribal lands. Noting the tribes would have the chance to legalize sports betting and online poker if approved by voters.

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