D.C. Council Chairman Phil Mendelson on Tuesday withdrew emergency legislation that would have allowed the D.C. Lottery to contract directly with Intralot as its sports betting operator and avoid a bidding process. The legislation was initially on the agenda at the request of D.C. Lottery CFO Jeff DeWitt, whose office sent a memo to the Council late last week explaining that the District would give up its position as a “first mover” on sports betting by having to go through a lengthy bidding process for an operator.
In the memo, the Lottery office suggested that if it had to go through a Request for Proposals, it could take up to three years to partner with a vendor, and referred to a Spectrum Gaming Group study that detailed what the District would lose by going through the normal bidding process.
Yet when Mendelson’s agenda item was called Tuesday, he simply withdrew it. There was no discussion, or surprise among other Council members, making it clear that the status of the legislation had been discussed before the meeting.
Councilmembers discussed legislation at closed-door session
In fact, according to ABC’s Sam Ford, the Council heatedly discussed the bill at the closed-door breakfast meeting and decided instead to hold hearings on the bidding process.
Sports betting in for a delay in DC it seems. During their breakfast meeting members argued against passing ”emergency” legislation to establish sports betting. They instead called for public hearings which they estimated would delay the start of betting from summer until fall. pic.twitter.com/4ae3KqwJnc
— Sam Ford (@ABC7Sam) January 8, 2019
NPR reporter Martin Austermuhle shared a similar view. The Lottery already convinced the Council to legalize sports betting and allow it a monopoly on mobile sports betting.
Some inside D.C. Council news: @ChmnMendelson has pulled an emergency bill that would have suspended normal procurement rules to give D.C. Lottery a sole-source contract to run a mobile/app-based sports betting platform. He says he'll instead hold a hearing on it.
— Martin Austermuhle (@maustermuhle) January 8, 2019
“The history of contracting related to the D.C. Lottery hasn’t been great through D.C. history,” Austermuhle tweeted.
The idea of having a single app, and potentially no competition to select an operator has caused discussion and speculation in the sports betting world. But DeWitt’s office is ready to make its case at hearings in the District.
“The Office of the Chief financial Officer welcomes the opportunity to lay out the compelling business reasons why it is necessary to go with a sole source contract,” Public Affairs Officer, Office of the Chief Financial Officer David Umansky told Sports Handle via e-mail Tuesday.
The D.C. Council legalized sports betting on Dec. 18, and is still awaiting the mayor’s signature before the Lottery, which will be the regulatory body, can begin working on regulations and preparing to launch sports betting. It’s safe to say that it’s unlikely that sports betting will launch in D.C. this year, but probably likely that it will be less than the “three years” that the Lottery suggested in its memo. The concern on the Council is that the District was the first in the region to legalize sports betting, and it doesn’t want to give up the perks it believes come with being the first mover.
That said, two bills have been filed in Virginia for consideration during the 2019 legislative session, but they are the first two bills filed in a state with no gaming structure, so it’s unlikely that Virginia could get sports betting up and running this year, even if it does legalize it. In Maryland, it appears as though sports betting must be legalized via ballot initiative, and the next opportunity for that is 2020. A little further afield, West Virginia was an early adopter and launched sports betting in October, and Delaware was the first state to launch after PASPA fell, in June.
A second package of emergency legislation relating to fees and waivers was introduced by Councilmember Kenyan McDuffie and passed unanimously.