Gov. Kim Reynolds signed a bill Monday allowing sports betting through Iowa’s 19 state-regulated casinos, making it the second Midwestern state — after Indiana — to legalize sports books.
The new law permits betting on nearly all college and major professional sports, as well as special events such as the Olympics. It gives the Iowa Racing and Gaming Commission, which regulates casinos, oversight over sports betting, too.
Reynolds had said little during the legislative session about her views on sports betting, leaving both sides wondering what she would do. The bill passed the Iowa House 67-31 on April 22 after a vigorous floor debate, described by one Republican legislator as “the best debate I’ve seen this year.” It passed the Senate a week before that, 31-18.
The state stands to collect a 6.75% tax on the casinos’ sports-betting “hold,” which is the house’s share after bets have been settled. Betting will be restricted to adults age 21 and over.
Nebraskans and other out-of-state bettors will be able to participate in sports betting using an app on their mobile phones. First, however, they would have to visit a casino in person to establish an account. The app would work only within Iowa’s borders, so Nebraskans would have to travel to Iowa to place bets.
In Nebraska, games of chance are forbidden by the state constitution, though keno, horse racing and a state-run lottery are legal. Several attempts to allow casinos into the state have been rebuffed. Gov. Pete Ricketts strongly opposes expanded gambling.
Brendan Bussmann, a former Nebraskan who now is a partner in Las Vegas-based gambling and entertainment consultant Global Market Advisors, said Iowa is “kicking Nebraska’s butts” by jumping ahead in sports betting. A 2013 study for the Iowa Racing and Gaming Commission said about one-fourth of the state’s gambling revenue comes from Nebraska residents.
“Iowa’s going to continue to profit off Nebraska,” said Bussmann, who was director of football operations at the University of Nebraska-Lincoln from 1996 to 2003. “Most of your Big Ten states are going to have sports betting within two years.”
The Iowa law permits betting as early as July 4, a date the bill’s sponsor said was chosen to symbolize freedom. But Brian Ohorilko, administrator of the Iowa Racing and Gaming Commission, said it will probably take a few weeks longer for the commission to implement rules for sports betting.
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“The earliest we would be looking at would be the end of July or, more likely, August,” Ohorilko said.
Reynolds signed the Iowa bill just one day before the first anniversary of a U.S. Supreme Court decision allowing states to enact legal sports betting. Until then, sports wagers had been forbidden nationwide except in Nevada, which has permitted it for decades. After that ruling, New Jersey, Delaware, Mississippi, West Virginia, Pennsylvania, Rhode Island, Arkansas and New Mexico legalized some form of sports wagering.
Coincidentally, an effort in the Nebraska Legislature to allow fantasy sports gambling foundered on Monday. State Sen. Justin Wayne tried and failed to attach an amendment to a bill on video “skill” games that would have legalized and regulated sites such as DraftKings and FanDuel.
Iowa is the third state to legalize sports betting this year, following Indiana and Montana. A bill also has been passed in Tennessee. Tennessee Gov. Bill Lee opposes legal sports betting but has said he will allow the bill to become law without his signature.