Ohio takes its time to start sports betting

COLUMBUS, Ohio — Ohio isn’t exactly the fastest state when it comes to launching its sports betting program. Of the surrounding states where sports betting is legal, only Michigan has been slower to get its program up and running.

When sports games start in Ohio on January 1, 2023, the deadline set by the legislature, it will be 374 days since Gov. Mike DeWine signed the law into law on December 23, 2021.

So what is the delay? A mix of typical bureaucracy and the reality of how the program was designed to cater to all the different gamblers who want a cut of the $3.35 billion that state officials believe gamblers will end up wagering each year, according to observers and state officials.

“There are a lot of chefs in the kitchen here,” said Andy Herf, a lobbyist who represented bar owners during the process to draft the sports betting law.

When DeWine signed the law into law, officials at the state agency tasked with setting up the program raised the possibility that sports betting could start sometime in late 2022. But they slammed the door on that possibility earlier this month when they announced January 1, 2023 will remain.

Compared to Ohio’s projected 374 days, other states were significantly quicker from signing the law to going live, cleveland.com and The Plain Dealer have found. These include Indiana (116 days), West Virginia (177 days), and Pennsylvania (185 days). Although Michigan bettors placed their first online bets on January 22, 2021, 399 days after Gov. Gretchen Whitmer signed the law into law. And casino-style in-person betting didn’t happen until two months later, in March 2021.

Moving further into the region, only Tennessee (489 days) took longer than Ohio to set up sports betting. But unlike Ohio, which has offered casino gambling since 2009, Tennessee built a gambling program from the ground up.

Other states include Iowa (89 days), Wisconsin (151 days), Illinois (255 days), and New York (264 days) — although Wisconsin is slightly different, as sports games there are sanctioned by a treaty between the state government and local Native American tribes .

Sports betting has been a long time coming in Ohio. State legislatures first introduced legislation to legalize it in July 2018, shortly after the US Supreme Court struck down a federal law restricting sports betting to Nevada. All of Ohio’s neighbors, with the exception of Kentucky, moved to legalize sports betting. Meanwhile, Ohio lawmakers debated for more than three years on issues such as the state agency that would regulate it, how sports betting would be taxed, and what types of companies would be allowed to offer it.

The passage of the bill took long enough. Now state officials need to make sports betting work.

Ohio has had a poor track record of late and promptly launched new legalization programs. Then-Gov. John Kasich signed into law legalizing medical marijuana in June 2016. But it wasn’t until January 2019 that the first retail marijuana store opened.

That’s partly why legislators set a firm start date in the new Sports Betting Act. And Jessica Franks, a spokeswoman for the Ohio Casino Control Commission, said the agency is working to meet them.

“We understand people would like it sooner, but that doesn’t stop us from following all the very detailed requirements of the Sports Gaming Act,” Franks said.

At the urging of the myriad players involved in lobbying for the law, Ohio set a universal launch date for all industry players, though online betting apps could launch almost at the push of a button.

The quickest would be casinos that need to physically set up sports betting but have experience with it and could be almost done by now.

Letting each group start offering bets when they are ready would probably start the program faster. But it would leave bars and restaurants looking to cater to betting shops, trying to venture into uncharted territory, said industry lobbyist Herf.

“There’s no doubt that sports betting could have been up and running by now,” says Herf. “But being first to market would have been a huge advantage. The legislator did not want to push the advantage in any direction and thus the universal start date.”

Who controls all this?

In addition to the universal start date, the numerous agencies involved in regulating the industry have slowed the schedule.

There is the Ohio Casino Control Commission, which is responsible for, among other things, the development of most of the program rules, setting qualifications for applicants, advertising restrictions and other consumer protection measures, and the specifics of ensuring integrity by looking for suspicious betting patterns. State officials also solicit feedback for each rulebook from industry stakeholders before and after it is written.

Then there’s the Common Sense Initiative, another agency that reviews proposed rules by government agencies for their impact on businesses. Under the CSI, rules must be approved by the Joint Committee on Agency Rule Review, a body that includes state legislatures.

And then there’s the Ohio Lottery Commission, which has a role in regulating the smaller sports betting kiosks in bars and restaurants. While the Casino Control Commission is responsible for approving companies that will actually provide the betting kiosks, the Lottery Commission is involved in pre-approving the individual companies where the kiosks will be located.

Finally, the Ohio Department of Development has to certify tourism numbers for some applicants, as lawmakers have extended the option to some smaller counties to have physical betting sites, but only if they can document visits from 4 million people.

Some of the faster states had more ad hoc starts, letting casinos take bets as soon as they were ready, sometimes with relatively little fanfare. But Jeff Juwel, a sports betting industry analyst writing for SportsHandle.com, said a universal launch date can create additional competition between gambling operators to the benefit of bettors.

“Probably it’s a more solid experience for the consumer, too, because a lot of these sports books, and they’re passionate about customers, so they offer bonuses,” he said.

A concerted start date will also help increase hype and interest in sports betting, especially if, for example, the Ohio State University football team attends a bowl game in January 2023, Gem said.

“There’s going to be a lot of drumbeat and fanfare, but if it was some kind of dribs and drabs, it wouldn’t have been the same,” he said.

What has been done so far and what’s next?

Casino Control Commission official Franks said the agency has approved a number of rules and is in the process of approving four more.

And what’s next, next Wednesday, June 15th, is an application window for what the state calls Class A – online betting platforms – and Class B – physical casino-style betting sites.

On July 15, Class C hosts — the small kiosks at on-site alcohol-licensing businesses like bars, restaurants, and bowling alleys — can apply. There are later deadlines for companies to submit compliance documents such as game schedules as well as background check employee applications.

And the Casino Control Commission says they will have everything approved by January 1, 2023.

The Ohio Lottery Commission also plays a role in approving Class C hosts, essentially pre-approving them for the Casino Control Commission.

And lottery officials have pre-approved 469 Type-C applications.

According to Gongwer News, Lottery Commission director Pat McDonald announced the application numbers at a Lottery Commission meeting on Wednesday.

At the meeting, McDonald also said he had heard complaints from the media and elected officials that sports betting was taking too long to launch.

“It’s not as easy as it might sound to some people,” McDonald said.