On Wednesday, the DC Council Committee of the Whole held a public roundtable discussion to discuss the proposed $215m sports betting contract with the Greek lottery operator Intralot.
The contract essentially grants Intralot a monopoly over lottery sales and sports betting in DC by making the Greek company the sole-source provider for sports betting and lottery services in the District.
The contract is the product of a sole-source sports betting framework which was proposed by Councilmember Jack Evans last year.
In February, the DC Council approved Bill 23-25 which allowed the Lottery to bypass the competitive bidding process. As a result, Intralot, the lottery’s current vendor, was awarded the sports betting contract
Several industry stakeholders and DC lawmakers have voiced concerns over the council’s decision to grant the contract to Intralot. Some stakeholders have even accused the council of favoritism and improper behavior.
Members of the council must now decide if they will move forward with Intralot acting as the District’s sports betting vendor or take a different approach. Wednesday’s roundtable acted as a discussion lasting just under three hours with no vote being scheduled.
iDEA calls for a competitive bidding process
The American Gaming Association (AGA) took a neutral standpoint on the matter, and instead offered guidance on how the DC Council could proceed after deciding to skip the competitive bidding process.
Chris Cylke, the AGA’s Vice President of Government Relations said: “While the AGA recognizes that there have been significant public concerns surrounding the process that has led to the selection of a vendor to offer sports wagering, it is not our role to comment directly on that process or the suitability and ability of that specific vendor to successfully provide sports betting in the District.
“What we can do is offer input on the critical areas that the District and every other governmental body should consider as they decide who is authorized to offer sports wagering within their jurisdiction.”
Prior to the discussion, another industry trade group called iDEA Growth issued a public statement on the situation. The statement strongly opposes the DC Council’s decision to bypass the competitive bidding process for sports betting in DC.
Jeff Ifrah Idea Growth’s Founder said: “History demonstrates that competition through a consumer-choice business model brings revenue and creates a robust industry. DC should be best positioned to reap the financial benefits of a thriving industry in which to allocate funds to appropriate initiatives.
“We encourage the City Council to opt for an open process that will benefit consumers and give DC the opportunity for the greatest return on revenue. In particular, we encourage DC to avoid delays in rolling out sports betting. DC consumers want to get online and bet on sports this Fall and that can still be accomplished if the Council will address concerns raised by this contracting process.”
Opposition from lawmakers
Several lawmakers at the roundtable offered testimony on DC’s decision to skip the competitive bidding process. Council Members Robert White and Elissa Silverman, who are opposed to the council’s decision, were among the lawmakers who provided testimony.
White said there was no “justification” for the lottery to bypass the competitive bidding process.
White said: “I voted against a sole-source because I don’t think it was justified. I didn’t buy the argument that Maryland and Virginia were going to quickly pass, and the didn’t. So now I wonder what’s the justification?”
When introducing the initial sports betting legislation and the proposal to skip the competitive bidding process, Councilmember Jack Evans claimed that the DC would lose out on sports betting tax revenue dollars as neighboring states were close to legalizing sports betting. This, however, was not the case as neither Virginia or Maryland have legalized sports betting this year.
Councilmember John Ray also provided testimony at the roundtable discussion. Ray said that the sports betting component was “a generous tip to the sole-source winner” of the DC Lottery contract.
Ray also questioned various aspects of the deal as well as the financial implications of working with Intralot. Over the past year, the three major credit bureaus downgraded Intralot’s rating several times.
Ray asked: “How much money is it costing the district to finance this very weak financial company? If you learned the retirement board was investing your money in Intralot, would you be happy? Would you buy Intralot shares? If the answer to that is no, why would you ask the District taxpayers to invest their money in Intralot? Mister Chairman, you need to take a serious look at this contract.”
Silverman went on to question the involvement of Councilman Jack Evans, the main proponent behind the council’s decision to skip the bidding process. Silverman raised concerns that only the “most well-connected businesspeople with ties to City Hall are involved” in the DC Lottery contract.
Evans’ sports betting bill contained several provisions relating to private corporations, as well as the owner of two DC sports teams, Ted Leonsis. Evans even attempted to include a payment to the major sports leagues in the form of an integrity fee in the bill last year.
Jack Evans faces more scrutiny
Evans’ ethics have also been called into question after being accused of using his position on the Metro Board for his own personal and financial gain.
Last week, agents from the Federal Bureau of Investigation (FBI) raided Evans’ home after he announced his resignation from the Metro Board.
Despite the ongoing efforts being made to strip Evans of his committee status, he appeared at Wednesday’s roundtable discussion.
With both Evans and the DC Lottery facing scrutiny from all angles, it’s unclear what this means for the future of sports betting in DC. The council will need to decide if it goes ahead with Intralot handling the lottery’s sports betting operations or if it will reopen the competitive bidding process to other vendors.
The entire roundtable discussion can be streamed below:
