Hawaii Contemplates Online Gambling Legalization in 2024

Sen. Ronald D. Kouchi of Hawaii has unexpectedly submitted a ground-breaking bill that would bring internet gambling to the US. The bill, SB3376, is not your usual candidate for gambling growth, but it does aim to create a single online market for sports betting and poker.

The goal of Senator Kouchi’s measure is to address the pervasive problem of unlawful internet gambling, which affects tens of thousands of citizens of Hawaii and frequently takes place on unregulated offshore platforms. The creation of the Hawaii Gaming Control Commission (HGCC), which would include seven part-time members chosen by the governor, is the suggested remedy. This commission would oversee online-only gambling, keeping traditional retail gambling at bay.

The bill emphasizes the urgency of generating additional income for Hawaii, especially after the 2023 wildfires that have left the state grappling with recovery. By regulating online gambling, the proposed legislation anticipates capturing lost revenue and redirecting it to benefit both the state and its citizens.

Online Poker and Sports Betting

The HGCC would choose one operator for licensing and provide a 10-year renewable license if the measure is approved. With the exception of casino games, the chosen licensee is able to provide online poker and sports betting. The novel profit share in the financial arrangement starts the first year at 70% for the state and 30% for the operator. Every year after that, this ratio progressively tilts in the operator’s favor by 5%, to a minimum of 5%.

While Hawaii’s proposal stands out for its distinctive revenue split structure and focus on online poker without casino games, challenges loom on the horizon. The state’s relatively small population and the niche appeal of poker might pose hurdles in attracting operators. The bill also remains silent on negotiations for interstate compacts, raising questions about sustaining online poker traffic.

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The proposal prioritizes sports betting due to its wider popularity and potential income, echoing previous strategies observed in states such as Kentucky. The bill’s aggressive timeframe, which calls for the market to begin operating on July 1, 2024, gives the Hawaii Gaming Control Commission a short window of time to receive applications, choose a winner, and perhaps begin operations in the first half of 2025.

Industry observers closely monitor Hawaii’s distinctive approach to online gambling as the legislative process progresses, speculating on how it will handle the difficulties and unpredictabilities that lie ahead.

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