Don’t Bet on It, Yet

Montana became one of the first states to legalize sports gambling earlier this year, but the chance to place a bet in your neighborhood sports bar is still months away

By Andy Viano
Fatt Boys Sports Bar and Casino on Sept. 6, 2019. Hunter D’Antuono | Flathead Beacon

Gov. Steve Bullock signed House Bill 725 into law on May 3, creating legal and regulated sports gambling in Montana and making it one of the first states to authorize the practice since a landmark U.S. Supreme Court ruling in 2018.

But last weekend, when America’s most popular sport dominated TV sets and sports bars around the country, football fans in Montana still didn’t have a way to place a bet on their favorite team, and legal sports gambling remains months away from becoming a reality.

The newly passed sports gambling law puts the responsibility for managing the program in the hands of the state-run lottery, and Bullock vetoed a separate bill that would have allowed sports gambling to be privatized. Because the implementation of sports gambling now falls to a public agency, the drafting of rules and regulations must comply with the same legal process as any government outfit, with a public comment period of between 30 days and six months mandated once draft rules and regulations are released. Those rules are currently being fine-tuned by the lottery and newly renamed State Lottery and Sports Gambling Commission, and their release, according to the lottery, is “close” to happening.

No one, however, is interested in rushing sports gambling to market, even after the legislator who sponsored the bill, Rep. Ryan Lynch (D-Butte), told the Associated Press in May that the goal was to have a mechanism for betting in place by the start of football season.

“Early on, I think a lot of people thought that it could be implemented (quickly),” John Iverson, government affairs consultant for the Montana Tavern Association, said. “But it is an entirely new form of gambling, not just for Montana but for the United States, other than Nevada, and states are trying to figure out how to make sure this works right and is properly regulated and taxed.”

Chris Gillette, who owns the Kalispell sports bar Fatt Boys, put it more bluntly.

“They don’t want to do it halfway,” he said. “(If) they do it and then all of a sudden it backfires, it’s going to look bad.”

There is no shortage of complexities, big and small, related to drafting regulations and, as Iverson pointed out, few blueprints from other states to follow. Logistics range from how people will place bets to what forms of payment will be accepted to the retailer licensing process to how lines will have to be finalized before the first bet can be placed.

“We’ve been working towards implementing this since the bill was signed into law,” Jennifer McKee, communications manager for the Montana Lottery, said. “We’re very excited and we’re hoping that the public is as excited as we are when it rolls out … but we do have a responsibility to the public, so we haven’t skipped any steps.”

The law provides some framework, including a mandate that retailers obtain a separate sports wagering license and prohibiting anyone associated with college or professional sports from wagering on any games. The framework, however, leaves plenty of gray area for regulators to clarify.

For example, the law would allow wagers to be placed on college athletics, including games contested by the state’s two flagship schools, the University of Montana and Montana State University. Contests like the annual Brawl of the Wild football game figure to be among the most wagered-on in the state, but there are complications that come with allowing betting on games contested by athletes who come from the same towns where wagers are being made. Chatting with a neighbor about their son’s injury status, game-plan details or other insights could, in some circumstances, give a bettor an unfair advantage.

“Montana’s one big small town,” McKee said. “The college athletes who play, they’re also members of communities that aren’t that big. That’s this education and training piece that we’re working on.”

There is a bit more clarity as to how bets will be placed. Gamblers will be able to see betting lines and place bets at kiosks located within retailers, not unlike the kiosks currently used to buy lottery tickets, and the lottery is particularly excited about a mobile app it plans to release at the same time. Users of the app would be able to view all available betting lines and place bets on games through their phone, provided they are physically within a licensed retailer, using an e-wallet similar to the one currently used to make other Montana Lottery purchases. That means a table of fans watching a game over a pitcher of beer at their neighborhood watering hole could place a bet on the next game on the schedule without getting up from their seat.

“It’s going to be good for the atmosphere and that’s just going to make it that much better for facilities like us,” Gillette, the Fatt Boys owner, said.

Casinos, like the one at Fatt Boys, are a significant financial driver for small business owners like Gillette, but the direct financial impact of sports betting for all licensed retailers is projected to total a modest $3.9 million in fiscal year 2020 (retailers will collect a 6 percent commission on all bets made). More than those gains, groups like the Montana Tavern Association are enthusiastic about the ancillary benefit from visitors who stop by a bar or restaurant to place a bet and stick around to spend a couple more bucks while they’re there.

“It’s another reason for someone to walk in your door,” Iverson said. “The real excitement is it gives people another reason to stop by, say hi, have a cheeseburger and have a beer.”

Most profits collected by the lottery will be deposited in the state’s coffers, to the tune of an estimated $3.7 million in 2020, with projections anticipating the total to rise to $5.4 million by 2023.

Whenever sports gambling does eventually arrive in Montana, betting lines will be set by the lottery’s vendor, Intralot, a Greek company with experience managing sports gambling operations in parts of Europe where sports gambling has been legal for years. Gamblers will be able to place wagers in Montana on outcomes familiar to anyone who’s visited a Las Vegas sports book, including money lines, over/under totals, parlays and prop bets. And sports gambling, like the lottery, will be restricted to people 18 years and older.

“The tavern industry is excited about bringing sports gambling to Montana; we think it’s going to be a fun amenity for people to enjoy,” Iverson said. “We’d like to see it come to market soon, but we also understand that it needs to be done right.”

More information on sports gambling can be found on the Montana Lottery website, www.montanalottery.com.

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