Sports betting legalization efforts fail again in Hawaii

Efforts to legalize sports betting and casinos in Hawaii have once again been unsuccessful. The state’s lawmakers have repeatedly turned down proposals to authorize online sports betting in addition to other forms of gambling.

The 2023 legislative session saw a repeat performance of previous years to legalize the activity. Due to online sports betting being permitted in around 35 states, the activity was reportedly the only form of gaming that stood a chance of being approved this year.

While Hawaii has a significant number of problem gamblers, most of whom sprung up due to unregulated gambling houses, it has no gaming establishments. These include tribal or commercial casinos, off-track betting parlors, racinos, sports betting, pari-mutuel wagering, iGaming, or a lottery. Utah is the only other US state that is as devoid of gambling.

State Rep. John Mizuno (D-District 28) introduced a sports betting bill by mid-January. The statute, House Bill 344, proposed that regulation of gambling on sports is legalized and that the activity would fall under the regulatory authority of the state’s Department of Business, Economic Development, and Tourism.

At first, Mizuno contemplated authoring a bill that could authorize the poker rooms to operate in the state. He floated the idea for a proposal to permit gaming rooms with poker and sports betting in December; however, he eventually settled on an online-only sports betting path.

The bill would have authorized online sportsbooks to offer their services in Hawaii if approved. Currently, only sports book operators with licenses in up to three other states can qualify for the state’s consideration.

On Wednesday, the Hawaii House Committee on Economic Development opted to shelve the bill due to the merger interest for gaming in Honolulu, the state’s capital.

This decision faced some opposition from the sports gaming industry and its supporters, who claimed that there was already illegal sports betting in the state by thousands of its residents. Legalizing, regulating, and taxing the activity will provide Hawaii with one more revenue stream.

Sports Betting Alliance lobbyist Pat Gibbs pointed out to the committee that in an Ernst and Young study on the gaming industry, it was estimated that around 276,000 people placed illegal sports bets yearly in the state. The activity is usually done via offshore sites on their devices or through booking and totals $670 million annually.

When asked about the location of said gamblers, Gibbs admitted that the estimates were culled from a national study that did not have any specific emphasis on the state.

“So we don’t have specific numbers. Because it’s an illicit market with participants and operators who do not want to be tracked,” Gibbs said.

There were also estimates by the gaming industry that if legalized, online sports betting could bring in around $7 million for Hawaii.

This benefit was brushed off by state Rep. Elijah Pierick, one of the gambling opponents. He claimed that whether or not the activity was legalized, it would result in the same kind of harmful situations.

“The statistics are highly against them. They probably are not going to win their wager, they are probably going to lose more of their money,” Pierick said.

Committee chair Rep. Daniel Holt revealed that he called for the bill to be disregarded. Holt is no stranger to illegal sports betting as the activity is prevalent in his Kalihi district, and in the past, he supported local sports betting and poker parlors.

“I think maybe at some point this may be a worthy cause for us, but at this point, $7 million a year may not be worth putting our communities at risk,” the committee chair Rep. said.

The committee leaders revealed that the recent attempt was likely the first and last for legalized sports betting and gambling this year. While the Senate could take up a bill to expand sports betting and gaming, their odds currently seem long.

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