Arkansas Lawmaker Argues That Mobile Sports Betting Is Unconstitutional

An Arkansas state senator is challenging the constitutionality of a recent proposed Racing Commission rule change that would allow statewide mobile sports betting.

In a letter to the state Racing Commission, Sen. Mark Johnson, R-Little Rock, wrote that Amendment 100, approved by Arkansas voters in 2018, authorized “casino” gaming only at four brick-and-mortar casino locations statewide.

On Dec. 30, however, the Racing Commission unanimously approved a rule change to allow mobile sports betting anywhere in the state. The commission regulates gaming in Arkansas.

There are three casinos operating in Arkansas. A fourth has been approved but has not been built.

The state’s casinos already allow sports betting at ticket windows and kiosks. The casinos have not been permitted to offer off-site mobile sports betting without the Racing Commission rule change.

Definition of ‘Casino’ Cited

The senator said the term “casino” is defined in Amendment 100 “as a facility where casino gaming is conducted.”

This language calls into question the validity of “electronic gaming from locations other than the casino,” Johnson wrote.

“While this could be allowed by a future amendment to Amendment 100, I am doubtful that this could be constitutionally accomplished by rule, or perhaps even by statute,” Johnson wrote.

Rule Change Allows Mobile Wagering, Casino Executive Says

Carlton Saffa, the chief market officer at Saracen Casino Resort in Pine Bluff, told Gambling.com on Tuesday that off-site mobile sports betting was prohibited by the previous state rule, not the state constitution. The proposed Racing Commission rule change would legalize mobile sports wagering across the state, he said.

Johnson urged the Racing Commission to be prepared to defend the mobile sports-betting rule when it comes before the Arkansas Legislative Council this month for consideration.

Legislative Vote at End of Month

The proposed rule change, approved late last month at a Racing Commission meeting, next heads to the Arkansas Legislative Council for a vote, possibly on Jan. 28.

The Legislative Council, which meets monthly, normally approves proposed rule changes from the state’s board and commissions.

If the legislative panel approves mobile sports betting, gamblers in Arkansas might be able to use sports betting sites on their smartphones and computers by February. The Super Bowl, usually a heavily wagered event nationwide, is set for Feb. 13 this year at SoFi Stadium in Inglewood, California.

Governor Gives Thumbs Up to Mobile Wagering

Republican Gov. Asa Hutchinson has said he supports mobile sports betting partly because it would keep Arkansas competitive with neighboring states that have already authorized online wagering. Hutchinson said he wants to ensure geofencing is in place to ensure wagering takes place within approved state boundaries.

In his letter to the Racing Commission, Johnson said it is an “absolute joke” to contend bettors placing mobile wagers will always be within state borders.

“Modern technology can make it look to any recipient that the communication originated wherever the sender wishes it to appear from,” he wrote. “I have verified with a software developer that specializes in mobile applications that this is a fact, adding that it is very easy within the U.S. to fake where the transmission is coming from. Slightly more difficult beyond our national borders but still possible.”

Online bookmakers say sophisticated geofencing can ensure bets are made within defined boundaries.

Saffa said he agrees with national online bookmakers that geofencing works.

Arkansas Attorney General Issues Legal Opinion

In a move that captured national attention, the Racing Commission’s proposed rule change includes language granting local casinos 51% of profits when partnering with national online bookmakers on mobile sports betting apps.

Popular, brand-name online bookmakers typically share 5-15% of profits with local casinos, an industry representative said at a November Racing Commission meeting.

A legal opinion issued Dec. 30 by Arkansas Attorney General Leslie Rutledge states that Amendment 100 “is silent” on revenue-sharing arrangements. She noted the Legislature “has not enacted any legislation on the topic, as it clearly may do.”

Rutledge also wrote that rules promulgated by the Racing Commission do not “speak to this issue.”