Hawaii Proposes Lottery and DFS as Old Gambling Attitudes Thaw

Posted on: February 2, 2016, 04:34h. 

Last updated on: February 2, 2016, 04:35h.

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Expertise: Commercial Gaming.
Hawaii House speaker Joe Souki lottery DFS
Hawaii Speaker of the House Joe Souki, who wants to reverse the state’s longstanding anti-gambling laws to establish a lottery. (bizjournals.com)

Could Hawaii, rivaled only by Utah as America’s least gambling-friendly state, be on the verge of legalizing lottery and DFS contests? Some lawmakers seem to think so, and a sudden deluge of bills have been introduced over the past two weeks that could overturn the state’s blanket ban on all forms of gambling.

Among them is HB 1830, presented by Joe Souki, the speaker of the House of Representatives, which would authorize the Department of Commerce and Consumer Affairs to license a single operator for a lottery, and keno. An identical bill, SB2626, has been introduced in the Senate by Will Espero.

This was swiftly followed by a similar bill from Hawaii ‘s Vice Speaker John Mizuno, although this one specifies that all lottery revenues would go to help the homeless.

DFS Regulation

Meanwhile, Representative John Mizuno (D-28th District) proposes a bill that would regulate daily fantasy sports (DFS). His bill would require firms like FanDuel and DraftKings to be licensed by the state and pay an annual registration fee of $25,000. They would then be subject to an annual independent audit, while regulations would also be established to protect minors and prevent insider trading, such as what allegedly happened with the two DFS giants in New York State last year.

“We’re all realists here; people gamble everywhere,” insisted Mizuno. “So if we can regulate it properly and benefit from it; get some of the proceeds to help our most needy; then at the end of the day it’s a win-win.”

Softening Stance?

Hawaii has said aloha-goodbye to various gambling bills in the past. In 2013, Souki sponsored a bill that sought to establish a sole casino license in Waikiki. It would have also established a state gaming commission, a gaming fund, and a problem gamblers program, but it was passed over to the 2014 session, where it foundered on the legislative rocks.   

For a state that has historically been completely anti-gambling, the new slew of bills, and their backing by the “right” people, may suggest a thawing of attitudes in the legislature. And meanwhile, polls from 2012 suggest that the majority of voters at least support the idea of a lottery.

The Powerball Effect

Mizuno believes that the recent publicity surrounding the record-breaking $1.5 billion Powerball lottery jackpot has also won the hearts and minds of the populace.

“The Powerball created a lot of interest, and the timing was impeccable,” he said. “It happened right before the start of the legislative session. Everything collided to have the perfect opportunity to bring this issue up.”

Not all voices, however, sing in unison. Representative Nicole Lowen (D- 6th District), argues that lotteries amount to a tax on the poor. 

“I don’t support [the lottery], although I realize we have to come up with other out-of-the box ideas to supplement state revenues,” she said. “Politically, and I can only speak for the House, I think there is very little likelihood we would pass anything under current leadership.”