Hawaii Online Sports Betting Bill Advances Despite Concerns

Hawaii’s proposed legislation to legalize online sports wagering and fantasy sports contests has progressed in the Senate despite a divided response from lawmakers, advocacy groups, and residents. House Bill 1308 (HB 1308) recently ed a critical review by the Hawaii Senate Committees on Commerce and Consumer Protection and on Economic Development and Tourism.

Bill Progresses Amid Differing Views

The legislation, which had previously cleared the House of Representatives, received approval from the Senate committee last Thursday. However, four of the nine committee noted reservations about the bill. If enacted, HB 1308 would permit four digital sports betting platforms to operate in the state, while prohibiting physical betting locations.

The bill’s ers argue that regulating online sports wagering could generate much-needed revenue for Hawaii, helping to address financial pressures and the high cost of living. Rebecca London, Senior Government Affairs Manager for DraftKings, submitted testimony highlighting the prevalence of illegal sports betting in the state.

“To create an effective legal market, legal operators must be able to compete with pricing from illegal, offshore sportsbooks that do not face the same taxation and regulatory costs,” London stated.

Despite legislative momentum, the bill faces strong opposition from various government agencies and advocacy groups. Concerns have been raised regarding potential financial and social harms linked to legalized gambling. The Hawaii Attorney General’s office, the Department of Commerce and Consumer Affairs, and the Department of Taxation have all expressed skepticism about the measure.

During committee discussions, lawmakers questioned the potential revenue the state could expect from regulated sports betting. Some noted that projected earnings may not justify the associated risks, such as increased problem gambling, financial distress, and potential rises in domestic violence.

Brandon Maka’awa’awa, Vice President of the Independent & Sovereign Nation State of Hawaii, voiced apprehension about the bill’s timing. He pointed out that a study on the potential impact of legal sports betting in Hawaii remains incomplete, calling it “irresponsible policymaking” to proceed without a full analysis.

“West Virginia, despite legalizing sports betting in 2019, has only generated just US$20 million in tax revenue, and it began over five years ago at the same 10% tax rate that is being contemplated [here]. Gaming tax revenue is consistently lower than promised, while the cost remains high,” Maka’awa’awa stated.

Uncertainties Surrounding Taxation and Regulation

A key issue with HB 1308 is the absence of tax rates or licensing fees in its current version. A House committee previously removed these provisions to maintain legislative momentum. However, without clear tax structures in place, estimating potential revenue remains uncertain.

Industry representatives have provided estimates to lawmakers to address concerns. Jeremy Linum, Director of Government Affairs for BetMGM, projected that Hawaii could generate between $10 million and $20 million in tax revenue annually if a 10% tax rate were implemented. Nevertheless, without defined taxation rules, these figures remain speculative.

While the bill has advanced through the Senate committee, it must still the Ways and Means Committee before becoming law.

Source:

Hawaii sports betting gets more green lights, advances in Senate, sbcamericas.com, March 14, 2025.