DC lottery contract might impact timeline for legal sports betting

WASHINGTON — How soon people can place legal sports bets in D.C. will depend on how city lawmakers decide to handle the March 2020 expiration of the D.C. Lottery contract.

Legislation that would allow the city to bypass a competitive bidding process and renegotiate the current vendor’s contract would make sports gambling possible by early September, 2019.

At a public hearing on the proposal, council members heard testimony from various panelists detailing how a competitive bidding process would cause a delay of up to three years — there’d be an opportunity cost of not being first, allow Maryland and or Virginia time to jump start their systems and delay cash infusions to early education and anti-violence programs.

Speaking in favor of the legislation, the city’s Chief Financial Officer said he estimates the city will earn 91.7 million dollars from sports betting over the next four years.

“Half of it — 50 percent goes to preventing violence and to children zero to three. So, it’s actually 45 million dollars,” Councilman Jack Evans told those gathered. “Both of these programs, the zero to three and the violence prevention, will help. One in the long run, one in the short run.”

Some council members warned there should be a high burden of proof of benefits before dismissing a competitive bidding process.

“In the long term, will our finances be better?” D.C. Councilman Robert White asked.

White said the only way to know whether the city is getting the best deal is by getting competitive bids.

“What’s going to get us the most amount of money for these programs in the long term, because the need here is not just one or two years.”

The Executive Director of the D.C. Lottery, Beth Bresnahan, testified that in the past 2 1/2 years, seven state lotteries renegotiated existing contracts that resulted in no changes, or more favorable vendor fees.

She said in the past five years, nine of 16 state lotteries opening contracts to multiple bidders ended up paying significantly higher prices through the new contracts that were awarded.

Bresnahan also said the current holder of the D.C. lottery contract would bring unique knowledge and expertise to the roll-out of sports betting in the city.

Intralot manages Europe’s largest sports book and sports wagering in 29 government-regulated markets globally.

DeWitt said each year of delay represents a revenue loss to the city of 30 million dollars and that his office’s recommendations are based on facts and what’s in the best financial and economic interests of the city.

“The conclusion is definitely apolitical. It is factual and finance based which is the role of my office of the Chief Financial Officer,” DeWitt said, while promising intense negotiations with the current vendor if the extension is approved. “I’m not just going to take their first offer.”

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