Written Testimony Could Decide Fate Of Connecticut Lottery And Gaming Bill

Connecticut lawmakers considering SB 1235 will have to dig deeper for nuance regarding their vote after the bill was barely addressed during Friday’s public hearing held by the General Law Committee.

Much of the seven-plus hours of testimony centered around cannabis, caregivers and the palliative use of cannabis, and electrical work with relation to solar licensing.

The limited oral testimony related to the gaming bill came from DraftKings Senior Vice President of Lottery Peter Sullivan and Lotto.com General Counsel Robert Porter. Both spoke in opposition specific to the first clause of SB 1235, which would prohibit lotto couriers in the state.

Banning lotto couriers was one of 11 subjects in the bill, including one provision that called to ban sweepstakes casinos. Connecticut is one of seven states offering regulated internet casino gaming, with FanDuel and DraftKings operating a de facto duopoly. The gaming titans reached agreements with tribal operators to offer that vertical in addition to mobile sports betting; the Connecticut Lottery also has an online sports wagering license.

Fair Play comes out swinging

The nine statements linked on the Connecticut General Assembly website are split equally: three statements in favor of the bill, three opposed, and three neutral. Support and opposition for the measure depended on who submitted testimony.

The most notable opponent against banning sweepstakes casinos was Fair Play, an organization researching sports betting and fantasy sports policy. It warned outlawing sweepstakes sportsbooks would result in “pushing more bettors into unregulated and offshore markets, where consumer protections are nonexistent, and tax revenue is lost.”

Fair Play did not stop there, saying those problems have arisen in part due to the state’s “restrictive licensing structure.” Connecticut has only three approved sportsbooks in FanDuel, DraftKings, and Fanatics Sportsbook. Fair Play claimed the regulations effectively created “a state-sanctioned oligopoly” that led to higher vig and worse odds for bettors as well as “sharp” bettors being banned by operators.

The counterweight to Fair Play’s testimony came from Department of Consumer Protection Commissioner Bryan Cafferelli, whose agency regulates gaming in Connecticut. He stated SB 1235 “will benefit the department by improving our regulatory oversight of the gaming industry,” singling out the provision that “prohibits using sweepstakes to fund unlicensed casino gaming or sports betting.”

Multiple opponents to banning lotto couriers

Sullivan was the only person to submit both written and oral testimony. The former founder and CEO of Jackpocket, which was acquired by DraftKings for $750 million last year, testified banning couriers “would unnecessarily inhibit additional revenue from being generated for the state — contrary to the stated mission of the Connecticut Lottery.”

He added lotto courier sales account for 15% of all ticket sales in neighboring New York and New Jersey, with both states showing double-digit growth in traditional draw game sales.

Porter, whose previous stops before Lotto.com included serving as vice president and general counsel for the Iowa Lottery, felt the provisions of the bill were “solutions looking for a problem.” He called lotto couriers the “Uber Eats of the lottery industry” and noted the robust mechanisms in place to make sure only bettors of legal age can purchase lottery tickets as well as being restricted to the state marketplace where they are purchased.

Jackpot.com Vice President of Legal, Compliance & Regulatory Affairs Paul Prezioso noted in his written statement that lotto couriers help reach a younger demographic. He said the success of lotto couriers in New York and New Jersey are “proven models for licensing and regulating couriers that Connecticut can follow.”