NCLGS Develops Model Legislation for Online Gambling to Guide U.S. Lawmakers

The National Council of Legislators from Gaming States (NCLGS) is working on making sample legislation to assist U.S. lawmakers in crafting useful online gambling bills. This initiative aims to provide a standardized framework that any state legislator can use when proposing online gambling legislation from 2025 onwards.

Objectives of the Model Legislation

Former Florida State Senator Steve Geller, who is leading the development of this model legislation, has outlined several key areas that the proposed framework will address. According to Geller, the draft legislation is designed to cover eight crucial aspects:

• Revenue Generation: Establishing mechanisms to maximize tax revenue from online gambling.
• Responsible Gaming: Implementing measures to promote responsible gambling and prevent addiction.
• Cannibalisation Concerns: Addressing fears that online gambling could negatively impact brick-and-mortar casinos.
• Advertising Guidelines: Setting standards for marketing online gambling products.
• Licensing: Defining the process for issuing licenses to operators.
• Age Limits: Ensuring strict age restrictions to prevent underage gambling.
• Data Sharing: Facilitating the sharing of data between states and regulators for better oversight.

Legislative Process and Timeline

The NCLGS plans to release a draft of the model legislation to its by August 1. This draft will be open for public comment for 30 days, allowing stakeholders and the public to provide . After reviewing these comments, the NCLGS will revise the draft and present a final version during their meeting from December 12-15 in New Orleans. The aim is to create a foundational document that can be adapted for use in various states.

As of now, nearly 40 U.S. states have legalized some form of sports betting following the Supreme Court’s overturn of the Professional and Amateur Sports Protection Act in 2018. However, only seven states—Connecticut, Delaware, Michigan, New Jersey, Pennsylvania, Rhode Island, and West Virginia—have legalized online gambling. The contrast in revenue between online gambling and sports betting is significant, with online gambling generating three to five times more revenue than sports betting.

Maryland State Senator Ronald Watson highlighted the importance of education and public engagement in the legalizing process for online gambling. In Maryland, any expansion of gaming requires a public vote. Watson stressed that a successful legalization effort must be treated like a campaign, involving a coordinated team rather than relying solely on the legislative proposal.

David Rebuck, former director of the New Jersey Division of Gaming Enforcement, emphasized the need for uniform technology standards and revenue certification. He also pointed out that anti-money laundering (AML) measures are crucial to prevent illegal activities. According to Howard Glaser of Light and Wonder, regulatory frameworks must be robust enough to combat money laundering and other financial crimes.

One of the contentious issues surrounding online gambling legislation is the concern of cannibalisation, which refers to the fear that online gambling could negatively impact land-based casinos. Bill Pascrell III of the Princeton Group criticized this argument, noting that studies have generally shown that online gambling does not significantly affect brick-and-mortar casinos. New Jersey’s data s this view, indicating that online gaming can coexist with traditional casinos and even enhance overall revenue.

Source:

”US legislators crafting model legislation to create pathway to legal igaming”, igamingbusiness.com, July 22, 2024.