Mississippians could soon legally place bets on sports event from the comfort of their couches as soon as next year if a bill is passed by the Legislature.
Lawmakers could be looking to add mobile sports wagering throughout the state after the Senate Gaming Commission held a hearing on Wednesday to discuss the topic.
Right now, Mississippi allows mobile wagering only on the property of a casino. Last year, three bills that would’ve legalized the practice —House Bills 172, 941 and 959 — died without floor votes.
Fourteen states now allow mobile wagering on sports events while the other nine only allow wagering on casino property.
Nevada and Iowa require a gambler to travel to a casino to set up a mobile account to wager on sporting events, but the other twelve allow gamblers to set up an account in their homes.
Taxes on sports wagers, thanks to the Lottery Act passed in 2018, goes to the state’s road and bridge fund.
Besides Tennessee, Mississippi would be the only state in the region to have mobile sports gaming.
Attorney Jeremy Kudon, who represents FanDuel and Draftkings as a partner at Orrick, Harrington and Sutcliffe, told the committee that illegal mobile gaming is already occurring in Mississippi.
“These sites can be accessed by anyone in Mississippi and you don’t have to drive two or three hours to a casino,” Kudon said. “It can all be done on your smart phone, your laptop or your desktop. These sites, which have tens of thousands of customers in your states, don’t pay a penny of tax revenue and most importantly, there is no regulatory oversight.”
Even though gambling through these websites is illegal according to state and federal law, Kudon said that 55 percent of gamblers in Mississippi utilizing them believe they’re making legal wagers.
The state is missing out on potential revenue. In 2019, sports wagering added up to $370 million in revenue for casinos in Mississippi. In New Jersey, which has both mobile and on-site sports wagering, generated $850 million in revenue. According to Kudon, 83.6 percent of the sports bets placed in the Garden State were on mobile devices.
Kudon estimates the state would’ve received an additional $20 million in tax revenue over the past two years if mobile gaming had been legal.
He also said that modeling any legislation on New Jersey's model, which has legal sports wagering sites partner with local casino operators, would be a win-win for both taxpayers and existing casinos while hurting only illegal sports wagering sites.
Allen Godfrey, the executive director of the Mississippi Gaming Commission, told the Gaming Committee that gross gaming revenues in the first year of sports wagering in 2019 were up more than 3 percent. While that doesn’t sound like a large increase, it added up to more than $70 million, with $40 million of that coming from sports wagering.
Gaming revenue was $2.2 billion in 2019, up from 2018 when the state’s gaming industry brought in $2.12 billion.
“In 2020, we were set to exceed 2019 and we were on a roll,” Godfrey said. “And as you know by the fact we’re all wearing a mask, things went down for a couple of months.”
He also said that June, July and August of 2020 were better months for the industry, even with reduced capacity, than the same time last year, indicating a rebound.
Mississippi, like five other states, got into the sports gaming business thanks to a 2018 U.S. Supreme Court decision, Murphy v. National Collegiate Athletic Association, which struck down a federal law known as the 1992 Professional and Amateur Sports Protection Act, which allowed only Nevada casinos to host sports gambling.
In 2016, Mississippi temporarily legalized daily fantasy sports and created a study commission. The Legislature approved permanent legislation in 2017 that not only set guidelines for the Gaming Commission to regulate daily fantasy sports, but also eliminated language from state law that prohibited betting on sports in anticipation of a decision in the NCAA case.
