The bill to legalize online sports betting in Hawaii in the current legislative session has been sent to the full Senate floor.
HB 1308 has already passed through several House committees, been approved on the House floor by a 35-15 and progressed through a Senate committee, albeit with reservations and amendments at several stages of the process.
On Wednesday, the Senate Ways and Means Committee passed Rep. Daniel Holt’s bill with amendments by an 11-2 vote, sending it for debate in the full chamber.
One amendment was to establish that the Department of Law Enforcement would regulate the market. Initially, the Department of Commerce and Consumer Affairs was set as the regulator, but Director Nadine Ando said during the last hearing that she did not feel her department was best suited for the job.
The proposal would mandate that a minimum of four online sports betting licenses be assigned to operators. The bill would take effect on July 1 and the market would launch by Jan. 1, 2026.
Four of the yes votes came with reservations. Committee Vice Chair Sen. Sharon Y. Moriwaki was a notable member to vote against the legislation, arguing that the social and regulatory costs “may far outweigh the revenues that would be generated.”
The bill has been was opposed at every turn by several governmental bodies including the Attorney General’s office, as well as religious and anti-gambling groups and Boyd Gaming, a Nevada-based casino company that operates a tourism service between Hawaii and its Las Vegas casinos. Sports Betting Alliance members FanDuel, DraftKings, BetMGM and Fanatics support it, as do workers’ unions and a host of politicians.
Original low tax rate and license fee restored
Another notable amendment announced by Chair Sen. Donovan Dela Cruz was to restore the 10% tax rate and $250,000 fee for a five-year license that had been scrubbed from the bill earlier this year. Taxation would be administered by the Department of Taxation.
Those were the original dollar amounts that Holt had first included in his bill and would be among the lowest in the U.S.
At a House Finance Committee session back in late February, before the bill crossed chambers, members argued that the figures were too low. Ando noted that five-year licenses for four operators would raise just $200,000 per year in licensing fees, which she called “not enough to do anything to regulate this industry.”
At that time, Holt said he supported scratching the proposed tax rate and license fee, noting that “they’ve got to go up.” Why they have been restored in their original form is uncertain, but they could still be amended before a full Senate vote.
More study needed?
Meanwhile, another bill in Hawaii backed by the state governor would establish a Gaming Working Group within the Department of Business, Economic Development and Tourism to assess how legal gambling might strengthen the economy.
SB891 cleared the Senate in early March with almost unanimous support and is making progress in the House. Moriwaki cited the idea of that study as a reason for voting no on HB 1308.
Gov. Josh Green said that while he is neutral on gambling, he can see that it would generate revenue. Whether he would be willing to sign an online sports betting bill into law in the next few weeks is unclear.
As HB 1308 was amended in the Senate after passing in the House, it must pass the Senate and get concurrence in its original chamber before it is eligible to be signed into law.
