>> At the state Capitol, a bipartisan legislative bill
to allow online sports betting in Wisconsin that
was on the fast track for a vote was pulled from this
week's calendar. Its future is uncertain, but the
legislation would have allowed the online betting
if it originated from servers in tribal casinos
in the state because under the Wisconsin Constitution,
most gambling is only legal on tribal property. The
idea was for the state to regulate and cash in on the
revenue generated from the explosion of online sports
betting, as other states have done. Researcher at
the Wisconsin Policy Forum, Mark Sommerhauser, did a
deep dive into online sports betting, and he
joins us now. And thanks very much for being here.
>> It's good to be with you. >> So how surprised were
you that this otherwise fast tracked bill just got
pulled? >> Yeah. So it was an
interesting development. It was also interesting to see
how the legislation had been fast tracked fairly
quickly in, in the weeks leading up to this last
week. And so, you know, perhaps, you know, the
speed with which the bill had come forward. There may
have been a desire among some lawmakers and some
stakeholders to kind of take a step back and, you
know, consider some of these issues more fully.
>> So what kind of revenue could the state realize if
it legalized and regulated >> So that's a great
question. I have actually not seen any projections as
of yet, probably in part because the legislation
would just be the first in sort of a two step process
here in Wisconsin. So even if this even if this
legislation were to pass be governor, there would still
be an additional step where the state would need to
renegotiate its compacts with the tribal nations
here in Wisconsin. So that would kind of actually be
the final threshold to cross before you could have
legal online sports betting. What we know from our
research is that we have looked at some other states
that have legalized online sports betting. As you
alluded, there's been dozens and dozens of states
that have done that just in the last few years. And
they have in some cases seen quite large, you know,
infusions of revenue. Of course, a lot of it depends
on how the extent to which it's taxed. And we see from
state to state, there are huge variations in that,
you know, from 5% to 50% taxes. So so the rate
differs hugely in states that have a high tax rate.
And in larger states it can be on the order of hundreds
of millions of dollars in tax revenue a year. Again,
that's on the very high end, and that's with a very high
tax rate. So that's not necessarily something that
could be extrapolated to Wisconsin, but it does give
you a sense of what what some states can.
>> As we described right now, people in Wisconsin
can only place bets online legally while physically on
site at a at a tribal casino. How unusual is this
across the country, that kind of restriction?
>> It's fairly unusual. I think there's only 1 or 2
other states presently that have a set up quite like
that, in part because so many states have that have
some form of legal gambling, have taken the step already
of legalizing the online sports betting. And so
Wisconsin is fairly unusual in that we permit it
legally, but only in this in-person setting right now
at the tribal casinos. >> So stepping back to your
larger research, describe kind of the explosion of
online betting that we've seen.
>> Yeah. So the really big trigger point for that was
the supreme US Supreme Court ruling in 2018. And
what that did is it essentially paved the way
for states to it struck down a law that previously
had barred most states outside of Nevada from
legalizing sports gambling. And what we saw was a very,
you know, swift reaction to that Supreme Court ruling.
And we are now, at last count, I believe, at 39
states that have some form of of legalized sports
betting. Nearly all of them permit online sports
betting. And so that has brought about a really
rapid shift in this whole landscape just since 2018.
>> And what are the numbers look like, you know, from
maybe five years ago or ten years ago or something to
today in terms of the amount of money being spent
on these pets. >> Right.
>> So yeah, we've seen hundreds of millions of
dollars in revenue increases in terms of the
total amount being gambled. And, you know, again, you
know, prior to the Supreme Court ruling, Nevada was
really the only state at a statewide level that was
permitting this. Now we're up to almost 40 states that
are permitting it. And there are more, as in here
in Wisconsin, that are considering it. So it's
pretty staggering the scale of how quickly that's
happening. are betting not just kind
of on the outcome of the games, but on like
individual plays within the games. And so it's it's
super popular and there's always something to kind of
bet on. But what are the downsides to this according
to your research. >> Yeah. So it's
interesting because outside of Nevada, it's only
recently that, you know, we've had legal sports
betting. And so it's only in these 49 other states,
only fairly recent development, that
researchers have been able to study at a large scale.
So we're actually seeing a lot of really interesting
research coming in just over the past couple of
years where they started studying this maybe three
or 4 or 5 years ago, and are just starting to get to
the point where they can draw some conclusions. And
those conclusions are mixed, but I would say definitely
contain, you know, some areas of concern. We have
seen higher rates of bankruptcy, of delinquency
in, in car loans and other forms of loans and debt,
and in states that have legalized sports betting
relative to states that have not. And interestingly,
at least one paper that we read that I think came out
last year was even able to take that a step further
and find a higher rates of some of these financial
sort of stressors within households, within states
that have legalized online sports betting. So that's
just one study again. But there's more of this
research coming in kind of by the month here. And it
does raise some areas of concern in terms of the
impact to households and household finances, that
sort of large scale legal sports betting can
potentially be associated. >> With.
>> And not even speaking of kind of the gambling
potentially trigger in some. Do you expect this move to
legalize it in Wisconsin will die or be revived
somehow, possibly through the courts?
>> I would expect that the discussion.
>> Is far from finished. I would expect that there's
going to be a lot more discussion, both among the
stakeholders, the tribes, and some of the other
stakeholders, because everybody kind of sees
where the national landscape is going. But,
you know, I would not dare to make a prediction as to
how it's going to turn out. But what we see is that our
our neighboring states have legalized this in some form,
so many other states across the country. And so I think
it's just going to continue it's just going to continue