In May of 2018, the U.S. Supreme Court ruled that the nation’s sports betting ban violated the States’ right clause in the U.S. Constitution. That gave each state the right to decide the sports betting issues for themselves.

In Arizona, it took a lot of intense negotiation between Governor Doug Ducey and the Arizona Indian Gaming Association (AIGA). In order to get the required Tribal approval to allow sports gambling in the state, a new Indian compact needed to be inked. At issue was a clause in the old compact that restricted Tribal concerns from partnering with off-reservation gambling providers.

The new compact was agreed upon in March of 2021. Afterward, The U.S. Department of the Interior approved the new compact, opening the door for Arizona sports betting legislation.

The Signing of HB 2772

While Gov. Ducey was negotiating with the state’s Indian Tribes, the state legislature went to work. The task at hand was coming up with meaningful sports betting legislation that would satisfy all interested parties. After several bills were introduced and rejected, House Bill 2772 (HB 2772) made the final cut. It passed both the House and Senate with bipartisan support.

When the bill hit his desk, Gov. Ducey was proud to sign the bill in April of 2021. The signing came as no surprise given the high level of support sports betting was getting throughout the state.

Detail of HB 2772

It took a few weeks for the details to leak, but residents of Arizona finally got a look at the new law in June of 2021. What was very clear was the bill covered all issues that were relevant to state residents. Here are some details covered in HB 2772.

The Arizona Department of Gaming will be permitted to issue up to 20 sports betting licenses. Each license would grant the licensee permission to offer both retail and online sports betting access. In later legislation, the application fee for applicants was set at $750K. Approved applicants will need to pay an annual licensing fee of $150K. Finally, sports betting tax rates on revenue were set at 13.75% for retail sports betting operations and 18% on the mobile betting side.

As for the allocation of betting licenses, the Arizona Department of Gaming will allocate the 20 licenses as follow: 10 sports betting licenses to the state’s Indian Tribes and the other 10 licenses to the state’s pro sports franchises.

With 24 Indian casinos currently operating in Arizona, it will be up to the AIGA to decide which Tribes will be awarded a license. The Indin Tribes will be permitted to open retail sportsbooks inside their respective casinos. They will also be permitted to maintain one mobile sports betting “skin” or app.

As for the state’s pro sports franchises, they will be permitted to open retail sportsbooks that are adjacent to their respective stadiums or arenas. However, they will not be permitted to open retail betting locations within their facilities. The pro sports franchises will also be permitted to launch one mobile betting app a piece.

Note: HB 2772 does not prescribe a launch date for sports betting. The industry as a whole is targeting the start of the NFL season on September 9, 2021. By all indications, that date seems feasible.

The Operators

While the Arizona Department of Gaming will be approving licenses, it will be the licensees that have to contract with sports betting operators. After inking their deals, the Arizona Department of Gaming will have the right to reject sports betting contracts. FYI: Here are a few contracts that have already been signed:

BetMGM with the Gila River Indian Community
Bally’s Corp with the Phoenix Mercury
DraftKings with the TPC Scottsdale Golf Complex
Fanduel with the Phoenix Suns
WynnBet with the San Caslos Indian Tribe
Caesars with the Arizona Diamondbacks