Washington D.C. Councilmember Elissa Silverman introduced Thursday legislation that seeks to reboot the District’s online sports wagering program by allowing mobile apps to compete for business alongside D.C. Lottery’s GambetDC app.
The proposal further intends to prohibit the renewal of the city’s lottery contract with Intralot, which received a $215 million sole-source deal to run both the lottery and sports betting that the Councilwoman deemed “highly controversial.”
“The District’s sports betting program was supposed to be a bonanza, contributing approximately $25 million per year to the District’s budget. Instead, it has been dud—actually losing $4 million in its first full year of operations,” Silverman said in an official statement.
The Councilwoman urged to “turn the page on this embarrassing episode,” pointing out that “residents deserve an online app that works, taxpayers deserve a program that brings in money, and we all deserve a system where we don’t hand huge contracts to a preferred company and its subcontractors without even looking at the competition.”
The newly introduced Sports Wagering and Fair Competition Amendment Act of 2022 would enable any company to apply for licenses to operate online and mobile sports betting apps in the District, with a 15% tax.
The legislation also terminates the contract with Intralot in 2024, with no renewal option. It further requires competitive bidding for future contracts to run the District’s lottery system and sports betting operations; and asks bidders for those contracts to “reasonably show how they would make money for the District.”
. @tweetelissa introduced legislation that would reboot the District’s troubled online sports wagering program by creating a competitive market for mobile apps, eliminate the controversial sole-source deal that resulted in dismal GambetDC app.https://t.co/e2JlOevcBt
— CM Silverman Office (@CM_Silverman) October 24, 2022
Silverman was one of five Councilmembers who voted against the sole-source contract to Intralot, which operates D.C.’s lottery system. The contract and enabling legislation created an exclusive market for Intralot’s sports betting GambetDC app in the city, except around venues such as Capital One Arena and Nationals Park.
Proponents of the deal said that the city would benefit from being a “first mover” in the region, but the Gambet app has been criticized by bettors “for being difficult to use.” The product infamously shut down during the biggest sports betting event of the year – the Super Bowl.
Gambet is the only app allowed to operate in the District, except in stadiums and retail establishments that are licensed separately to offer sports betting, and in federal areas where sports gambling is not permitted. The push to expand the District’s offerings comes as neighboring jurisdictions join the competition for sports betting revenue. Mobile sports gambling apps became legal in Virginia last year, and Maryland is poised to launch its program as soon as next month.
“If we’re going to have a lottery and a sports betting program, let’s at least make it a revenue generator for the city so it can fund important efforts in public safety, public education and housing,” Silverman added. “And let’s stop the bad practice of awarding lucrative contracts without competition.”
In 2019, Intralot was paid $215 million in a no-bid five-year contract to implement legal sports betting in D.C., and its app went live in 2020. It was initially expected to provide the state with $20 million annually, but instead it reported $1.5 million and ran a deficit of $4 million in 2021, its first full year of operation.