Bill SB3376 Could Make Hawaii the Newest American iGaming Market

USA and Hawaiian Flag in Oahu, Hawaii

Article by : Milena Petrovska Jan 31, 2024

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Senator Ronald D. Kouchi has introduced Bill SB3376, which is set to make Hawaii the latest US state to venture into the legal iGaming industry.

The proposed bill mentions the Hawaii Gaming Control Commission. This regulative body is supposed to be a newly established agency that will regulate the market.

Online Gaming Might Be Legalized but In a Limited Form

Kouchi’s bill proposes a single-operator market that will incorporate just two forms of online wagering – online poker and sports betting. The Hawaii Gaming Control Commission would be the regulator in charge of overseeing online gambling in the state.

It will oversee selecting an operator that will hold the market exclusively and will issue 10-year licenses. According to Kouchi, the bill is set to tackle the illegal online gambling operations that Hawaii residents partake in.

The regulated market would be a fantastic source of income and will aid the state, especially in crisis times such as this one. Hawaii was struck heavily with wildfires in 2023 and is still struggling to stay afloat.

Financial terms state that the profits would be split at a rate of 70:30. The state will take 70%, and 30% would go to the operator in the first year. After that, the ratio will shift towards the operator by 5% every year, but the state must have at least a 5% stake.

One of the biggest challenges Hawaii will face is operator interest. The state’s size and population are not that high, which raises questions regarding traffic, especially when it comes to online poker.

The Bill Doesn’t Have a Hearing Date, and Its Fate Is Uncertain

At the moment, SB3376 does not have a scheduled hearing date, and that makes its fate uncertain. This attempt will not even be Hawaii’s first try to legalize online wagering in some form.

Back in 2023, Rep. John Mizuno and Rep. Daniel Holt proposed the legalization of online sports betting and poker. Both representatives come from Kalihi, a region where illegal gambling is a major issue.

Holt noted that the illegal gambling rings bring more problems to the scene, and two of the biggest ones are prostitution and drugs. At the time, they proposed a test period that would include several small, privately owned businesses that would have to pay heavy taxes.

The two representatives went on to say that the tax money would go to good causes. One would be police enforcement, while the other would fund problem gambling foundations.

Eric Ford, an expert whom Mizuno introduced, doubled down by saying that the parties that would own the parlors would have to be local. Ford went on to say that Hawaii residents counted for more than 500,000 visits to Las Vegas per year. Supposedly, they generated between $400 million and $800 million in gambling activities.

Their proposed bill, House Bill 344, also included mobile sports wagering through an approved application.

Hawaii remains one of two states that haven’t legalized any form of gambling. The other one is Utah.