FanDuel And Horse Racing Headline Wyoming Commission Meeting

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From a sports betting standpoint, the biggest news to come out of Friday’s quarterly meeting of the Wyoming Pari-Mutuel Commission was that FanDuel was unanimously approved to become the third mobile sportsbook — following DraftKings and BetMGM — in the sparsely populated state, which requires no brick-and-mortar tether.

As for when FanDuel will go live in Wyoming, company spokesperson Kevin Hennessy told CO Bets that the operator “will have a better understanding after the Thanksgiving holiday on timing.” Meanwhile, the commission’s program manager, David Carpenter, said that PointsBet and Barstool are poised to follow FanDuel into Wyoming “very soon,” and that an additional operator had approached him about getting licensed in the state.

The problem with this mystery operator is it is currently only licensed in two jurisdictions, whereas an operator must be approved in three jurisdictions before it’s allowed to offer mobile sports wagering in Wyoming. During the meeting, Carpenter made it clear that he thinks the three-jurisdiction rule should be revisited, as it prohibits local operators — including Native American tribes — from getting in on the mobile action.

Furthermore, Wyoming is the only jurisdiction thus far to have explicitly authorized sports betting with cryptocurrency, and requiring a crypto-based sportsbook to get licensed in three other locales before Wyoming stands to cut into the state’s desired status as “the blockchain pioneers,” Carpenter said in an email.

Tribes, toothpaste, and market saturation

Wyoming’s commission is in the process of coming up with rules for skill-game operators, a handful of whom were on hand for Friday’s meeting. When asked if the dawn of sports betting in the state had negatively impacted their proceeds, these folks unanimously said it hadn’t. 

But L. Clare Johnson, staff attorney for Wyoming’s Northern Arapahoe Tribe, had a different story to tell. 

She testified that the expansion of skill games and mobile sports betting had cut into revenue at her tribe’s casino, which features a retail sportsbook, in part because the “tribe was unable to join the state market” for mobile sports betting due to the aforementioned three-jurisdiction rule. 

“The expansion of gaming is like toothpaste: Once it goes out of the tube, it can’t go back in,” she said in expressing concern that the state had reached a saturation point.

She then correctly noted that the state’s sports betting law would need to be amended for her tribe to become a licensed mobile vendor.

Unfunded mandates and simulcast shenanigans

The meeting’s biggest fireworks, however, came during a morning presentation by Ed Martin, president of the Association of Racing Commissioners International. Wyoming features three racetracks that offer live thoroughbred racing, as well as a robust network of off-track betting parlors, and therefore has a vested interest in how the federal Horseracing Integrity and Safety Act (HISA) will be implemented in July of 2022.

Despite two lawsuits challenging HISA’s constitutionality, Martin told the commission, “We’ve taken the position that this law is going to take effect at some point.” But while the law will presumably be implemented in some way on July 1, Martin is skeptical as to how far-reaching and effective it will be at that point.

In a recent letter to the Thoroughbred Daily News, Martin repeated recent comments from HISA’s chair, Charles Scheeler, who acknowledged that racetrack operators and state governments would have to spend more than they’re accustomed to spending in order to implement the federal law. With the help of the United States Anti-Doping Agency (USADA), HISA is designed to establish and enforce uniform drug-testing standards across the industry.

During the Wyoming meeting, Martin called HISA an “unfunded mandate,” noting that the law passed without any federal funding attached and that those tasked with implementing it have been dragging their feet.

“There are increasing voices wondering whether or not it’s even possible to get this thing off the ground by July 1,” he added. “I would engage your members of Congress to be loud and aggressive on this. I worked on Capitol Hill for 10 years of my life when I was younger, and I’ve seen Congress pass bills, but they really didn’t know what was in those bills. I kind of had hopes that it would be readily apparent by now that a technical corrections bill would be necessary and maybe the industry could come up with something they could live with, but there seems to be no impetus for that.”

But, as Martin noted, there’s a potential workaround. HISA only applies to thoroughbred racetracks that export their simulcast signal across state lines. Thus, if Wyoming or any other state didn’t want to abide by HISA, it could either stop exporting its signal or tilt its racing date balance to favor quarter-horse or standardbred racing. 

“At some point, there’s going to be a direct conversation between the Wyoming commission and HISA, and a parallel conversation with USADA, in terms of what you’re willing to do and what you’re not willing to do,” said Martin. “They’d love to have you send your personnel out to enforce their mandates. That’s up to you. The people who are in the major squeeze are the racetrack operators and the owners. And I think what’s going to happen with the owners is there’s just too much expense owning a thoroughbred. I might want to just own a quarter-horse. I can still have as much fun and make some money on it over there than on the thoroughbred side.”

Martin then went a step further, telling the commission, “You can’t force a state government to do anything. I’ve seen the same argument with cities in California who have declared themselves sanctuary cities. It’s the same principle. I wouldn’t encourage anybody to break federal law, but you authorize the export of signals. HISA would have to shut that down. The state agency could just say, ‘We’re not gonna do any of this, and if you want to enforce this, you can go ahead and do it.’”

Mike Seely has written about horse racing for The Daily Racing Form and America’s Best Racing, and has contributed pieces on a multitude of topics to The New York Times and Los Angeles Times, among other publications. He can be reached at mseely@bettercollective.com.

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