Hawaii Online Sports Betting Bill Passes First Senate Committee

While sports betting legislation has been slow to materialize in Hawaii, signs of progress are here.

The latest developments came just last week, when House Bill 1308, proposed by Democratic Rep. Daniel Holt, was unanimously approved by the Hawaii Senate Joint Committee on Economic Development, Tourism, Commerce, and Consumer Protection.

The bill, which had already passed the state House of Representatives, would allow four online sports betting platforms but no retail locations.

Specific information on tax rates and fees was not included, causing some to question whether the bill has any chance of advancing further.

Representatives from BetMGM previously told lawmakers that Hawaii could see between $10-20 million in annual tax revenue, assuming a 10% tax rate.

Sports betting is now legal in some form in 38 states, plus Washington, D.C., with Missouri set to launch this fall. Seven states, which are Connecticut, Delaware, Michigan, New Jersey, Pennsylvania, Rhode Island, and West Virginia – have also legalized iGaming.

With no casinos, sports betting, lotteries or daily fantasy sports, Hawaii is one of the few exceptions. And many would like to keep it that way.

Deputy Attorney General David Williams testified in opposition to the bill, expressing his concerns about risks associated with gambling. Williams pointed to studies showing “increased credit card debt, reduced credit and an increase in bankruptcies in the most vulnerable families” among problem gamblers.

A representative from the Department of Commerce and Consumer Affairs submitted written testimony in opposition to sports betting, saying that: “Many other states in comparable sized markets to Hawaii that have passed isolated sports wagering legislation have been disappointed in the outcome, tax revenues from online sports wagering are often less than anticipated.

“The revenues are usually not sufficient to fund or sustain regulatory and enforcement oversight and a responsible gaming infrastructure, crucial components of any gaming framework.” BetMGM and DraftKings were both present to address any concerns.  

An attorney representing the Sports Betting Alliance told listeners that legislation would help curb illegal betting practices.

Said Kathleen Owen: “A regulated, competitive mobile sports betting market would replace the predatory, illegal platforms already operating in Hawaii and generate new revenue for the state through a policy that has the support of constituents.”

Owen also cited a 2022 poll conducted by Anthology Research showing that 73% of Hawaiians support legalizing and regulating online sports betting for those 21 or older to help generate tax revenue. The bill has until May 2 to pass.