Waldrop: States to Lead on Internet Wagering

Waldrop: States to Lead on Internet Wagering
Photo: Anne M. Eberhardt
NTRA president Alex Waldrop

NTRA president Alex Waldrop sees little chance of federal legislation to allow expanded Internet wagering any time soon but he does believe that states will continue to take the lead on the issue.

Speaking at the International Simulcast Conference Oct. 8 in Lexington, Waldrop provided an update on Internet gaming expansion. Currently, pari-mutuel wagering is the only form of interstate gambling allowed on the Internet and with advance-deposit wagering now accounting for about 20% of total North American handle, Waldrop said the NTRA will continue to be vigilant to protect those interests.

Waldrop said numerous bills proposed in Washington have failed to advance. The American Gaming Association continues to push for federal legislation allowing expanded Internet wagering, but Waldrop said interstate Internet wagering on poker and casino-style games faces significant opposition.

He said that opposition is coming from state governments that see revenue potential for themselves, some land-based casinos including those run by Native Americans, legislators who oppose expansion of gaming on moral grounds, and Tea Party legislators who oppose additional funding sources that could lead to an expanded federal government.

"We expect the federal government to do what they've traditionally done on gambling issues: kick them back to the states," Waldrop said. 

Waldrop said without the expansion of interstate gambling, the industry has not seen the impact it had expected by now but he still expects added competition for the Internet gambling dollar coming at the state level, where betting could be conducted within the state.

Three states already have put laws in place to allow intrastate wagering: Nevada, New Jersey, and Delaware. Waldrop said it remains to be seen if these regulated forms of Internet wagering are able to draw customers at a level comparable to the unregulated offshore sites that have handled as much as $2.6 billion in some years from U.S. players.

At the height of the offshore Internet wagering boom with U.S. players, games of poker, casino gaming, and sports wagering that included bookmaking on U.S. horse races, Waldrop said one study estimated North American racing was losing $50 million a year in revenue.

Some states also have considered intrastate Internet wagering and have tabled or denied those measures. Waldrop said some of those states include Iowa, Kansas, Mississippi, Washington, Texas, and Hawaii. He said two large racing states that are considering legislation are California and Illinois.

Waldrop said it is important for racing to stay vigilant. He said tracks need to stay in contact with state representatives, especially in states where expanded Internet wagering is being considered, to make sure that any expansion of gaming in those states comes with compensation for tracks, which he said will be impacted.

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