Hawaii Online Sports Betting Bills Face Long Odds

Posted on: January 30, 2024, 01:28h. 

Last updated on: February 3, 2024, 12:58h.

Devin O'Connor @CasinoorgDevinO Read More

Expertise: Asia Pacific Gaming, Commercial Gaming, Legislation, Politics.

Hawaii is one of the most restrictive states when it comes to gambling.

The island state, located 2,000 miles from the mainland United States, doesn’t allow commercial or tribal casinos, racinos, sports betting, iGaming, pari-mutuel wagering, or charitable games of chance. Hawaii doesn’t even have a lottery, one of only a handful of states today.

Hawaii’s longtime hostility to gaming stems primarily from the state’s cultural values and spiritual beliefs. But it is also due to a considerable segment of the population thought to be prone to addiction.

Lawmakers in Honolulu habitually file legislation to end the state’s gaming prohibition. That is once again the case this year, with two bills introduced seeking to allow online sports betting.

Senate Bill 3376 was introduced by Senate President Ronald Kouchi (D- Kaua’i, Ni’ihau). The bill seeks to create a regulatory framework for allowing online sports betting and interactive poker.

House Bill 2765 seeks to allow online sports betting only. The bill comes from Rep. Daniel Holt (D-Sand Island, Iwilei). Holt was behind a failed effort last year to legalize gaming rooms where sports betting and poker would be allowed.

Both articles face extremely long odds of garnering legislative support and reaching Gov. Josh Green’s (D) desk. Green says he will consider any legislation that reaches his office. But he says the state must be careful in approving new industries that could cause societal problems.

Bill Proposals

Under Kouchi’s SB3376, an approved sportsbook and online poker operator would need to pay the state a one-time fee of $50K upon receipt of the license. Taxes on gross revenue oddsmakers win from bettors, and poker rake would be subject to an initial tax of 70%. The tax would decline 5% each year after a minimum of 5%.

To protect Hawaii residents who gamble on the internet, and to capture revenues generated in Hawaii from online sports wagering and poker, it is in the best interest of the state and its citizens to regulate this existing activity by authorizing and implementing a secure, responsible, and legal system for online sports and poker wagering,” Kouchi wrote in his bill.

Kouchi says “tens of millions of dollars” are being realized by offshore operators illegally serving Hawaii residents. But they are not taxed, regulated for fair play, don’t provide consumer protections, or deliver a tax benefit. The sports betting and iPoker bill sets the minimum age to participate at 21.

Holt’s HB2765 statute leaves the licensing fee and tax rate up for discussion. The bill, however, would allow people in Hawaii as young as 18 to gamble on sports via the internet.

The House gaming measure would only allow commercial sportsbook operators that hold licenses in at least three states to apply for online sports gambling privileges in Hawaii.

Bills Face Long Odds

Legislation to be considered in the Hawaii State Legislature must be filed by the end of business on January 24. The legislature’s 2024 session runs through May 3.

The Hawaii Senate and House are both strongly controlled by Democrats. The party maintains 23 of the 25 Senate and 45 of the 51 House seats.

The 2024 gaming bills have been directed to their chambers’ respective economic development committees.