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On-site vs. mobile fight key to sports betting question in Montana

Posted at 10:26 PM, Feb 03, 2019
and last updated 2019-02-04 14:14:09-05

BILLINGS – Last May, gamblers across the country rejoiced when the Supreme Court overturned the Professional and Amateur sports Protection Act, giving all 50 states the chance to legalize sports wagering.

So far, seven have, with many more, including Montana, introducing legislation this year. Three different Montana organizations are expected to write bills — the Coin and Slot Route Operators, the Board of Horse Racing and Intralot, which runs the state’s lottery operations. One, or a combination of all three, is expected to be heard by the Legislature later this month.

RELATED: Montana lawmakers considering legalized sports betting

For Montana’s casino owners, the sooner, the better.

“With us having simulcast (horse racing) and now the fantasy sports, it was basically like, ‘We’re ready to rock kind of right now, ready to go,'” said Kirk Dehler, owner of the Enterprise Casino in Billings.

The Enterprise is the only Billings casino offering parimutuel horse race wagering. Players can monitor different tracks, and wagers are made at kiosks connected to the tracks in real time. There’s no doubt it has boosted Dehler’s business.

“It’s been a really good thing to get people in the door,” he said. “It’s just having that little niche that brings people in the door and keeps them around.”

That’s the key: It gets people in the door. Horse racing isn’t Dehler’s biggest money-maker — far from it — but it builds his customer base, which is what the Montana Tavern Association is hoping sports betting will do.

This is their scenario. Businesses with gaming licenses will house kiosks connected to an out-of-state sportsbook, which will set odds on matchups from wherever the book is located. Players will have to come to the casino in Montana to make a wager but will be able to use a mobile device while inside.

“What they call geofencing,” Dehler said. “So they’ll geofence the casino, and you can come in with your tablet or cell phone and deposit money through a debit card or cash, but you have to be in confines of that establishment.”

The MTA believes sports betting is a means to an end, enticing a customer to visit who then might spend money in other ways.

“We want to see sports betting grow the Montana economy,” said John Iverson, the MTA’s government affairs lead counsel. “If we allow full mobile, internet-based sports gambling, you’re going to take a big chunk of Montana money and send it straight out of state. There’s not a significant amount of tax revenue that comes from sports betting, and so where the state’s going to win is to create more commerce in Montana, create more jobs in Montana.”

That could depend on Montana’s tax rate. Nevada’s sports betting tax is the lowest in the country at 6.75 percent, while Delaware and Rhode Island recently set theirs at 50 percent.

New Jersey, meanwhile, had an interesting solution to the on-site versus mobile debate. The state offers fully mobile betting, so a player never has to leave his or her house. But on-site taxes are less than 10 percent, while mobile bets are 13 percent.

Nevada’s rules for mobile betting fall somewhere in between. Bettors must go to a brick and mortar sportsbook to deposit money into an account, but then can place wagers on a mobile device from anywhere in the state.

“It’s been a tremendous advantage, because what you have with a mobile app is every cell phone is a betting window and a new customer,” said Vinny Magliulo, sportsbook director for Gaughan Gaming in Las Vegas. “The fact that it does create a convenience element — when there’s more convenience, there’s more handle.”

Magliulo has run sportsbooks in Las Vegas for 30 years and now works for the Vegas Stats and Information Network, a gambling-centric network anchored by Montana’s own Brent Musburger, who sides with Nevada’s process.

“I guess I would say the mobile operation is fine as long as you have to go to brick and mortar to put your funds in,” said Musburger. “I’m not a fan of what I hear is happening in New Jersey, where you can use PayPal and other things to fund an account. Here in Nevada, it’s cash-only. You can’t use credit cards, which is always a good idea when you’re talking about gambling.”

That’s the conversation for how Montana would implement sports betting, but the question still remains: Should it? Iverson said the answer may lie in a common Treasure State phrase: Montana is just one big small town.

“The question of are we going to be able to bet on the Cat-Griz game,” Iverson posed. “Montana is a small, low-population state. Are we going to be able to place wagers on a game that you or I or your next-door neighbor might have intimate knowledge of the condition of the quarterback’s ankle or the kicker’s foot? Does it concern you about the integrity of the sport, and the potential damage to the integrity of the sport?”

It’s the reason Shoeless Joe Jackson was banned from baseball in his prime, and Pete Rose isn’t in the Hall of Fame. Sports betting will never completely get rid of its scandalous stigma, but its legitimacy is on the rise, and Montana may be next frontier to embrace it.