Regulators in Arizona are on the verge of achieving something remarkable.
On April 15, Gov. Doug Ducey signed legislation that would legalize sports betting in Arizona.
At that moment, legislators were jubilant, but they were well aware of the challenging and ambitious task that lay ahead. The objective was to establish the newly legalized betting industry in time for the 2021 NFL season, which was set to commence on September 9.
In under five months.
Far-fetched? Certainly. Impossible? Not if you’re affiliated with the Arizona Department of Gaming. As this regulatory agency is now open to applications, the prospect of licensing and launching the inaugural sports betting operators in the Grand Canyon State by the commencement of professional football season appears more feasible than ever.
Is it possible for AZ sports betting to launch by Sept. 9?
The Arizona Department of Gaming (ADG) exudes confidence.
The department has consistently held onto its target launch date of Sept. 9, which is definitely set for mobile betting apps in Arizona, says Maxwell Hartgraves, public information officer with the ADG. He also indicated that retail sportsbooks may be partially established by that date.
“We aim to meet the Sept. 9 launch date efficiently and responsibly, while fulfilling all the necessary criteria. This is our ultimate goal.”
The ADG finalized the rules for sports betting on July 26 and subsequently initiated the application process for interested parties to offer regulated betting. They had only 45 days to review and approve applications as well as conduct internal control checks and testing. This short span of time is a feat only achieved by three other states in the country.
| State | Regulations Finalized | Launched | Time Elapsed |
|---|---|---|---|
| New Jersey | June 13, 2018 | June 14, 2018 | 1 day |
| Indiana | Aug. 28, 2019 | Sept. 1, 2019 | 4 days |
| Iowa | July 30, 2019 | Aug. 15, 2019 | 16 days |
| Arizona | July 26, 2021 | Sept. 9, 2021 | 45 days |
| West Virginia | June 21, 2018 | Aug. 30, 2018 | 70 days |
| Colorado | Feb. 20, 2020 | May 1, 2020 | 71 days |
| Mississippi | May 17, 2018 | Aug. 1, 2018 | 76 days |
| Illinois | Dec. 19, 2019 | March 9, 2020 | 81 days |
| Michigan | Dec. 20, 2019 | March 11, 2020 | 82 days |
| Pennsylvania | Aug. 15, 2018 | Nov. 15, 2018 | 92 days |
| Virginia | Oct. 12, 2020 | Jan. 21, 2021 | 101 days |
| Arkansas | Feb. 22, 2019 | July 1, 2019 | 129 days |
| New Hampshire | Aug. 7, 2019 | Dec. 30, 2019 | 145 days |
| Rhode Island | June 22, 2018 | Nov. 26, 2018 | 157 days |
| New York | Jan. 28, 2019 | July 16, 2019 | 169 days |
| Tennessee | April 15, 2020 | Nov. 1, 2020 | 200 days |
| Washington, DC | Aug. 30, 2019 | May 28, 2020 | 272 days |
The Arizona Department of Gaming remains committed to its timeline, detailing a plan to launch AZ sports betting by early September.
The ADG states that after the application window closes on Aug. 9, they will initiate a “Initial Qualification Evaluation Period” lasting five days. Once this period is over, the ADG will disclose the applicants who are eligible for licensing. If the department gets more applications than there are licenses, they will extend the evaluation period for up to eight more days.
Operators are permitted to launch their betting apps to the Arizona public by Aug. 28, enabling customers to set up their accounts. Sportsbooks can also commence marketing, and the inaugural daily fantasy sports contests can kick off. Assuming everything proceeds as planned, sports betting will commence 12 days subsequently.
“Hartgraves expressed, “It’s an incredibly thrilling experience, beyond anything else.” He continued, “We certainly set an ambitious target to go live on that date, specifically, the first Thursday of the NFL season. Overall, it has been a successful venture. Interestingly, it reminds me of how, a few months back, we saw this massive project looming in the distance and thought, ‘This is going to be quite a task to undertake.'”
Regulators confronted a significant challenge in sports betting
A five-month timeline has been set. Within this period, a regulatory framework needs to be built from the ground up, tax rates and licensing fees need to be established, decisions made on the number of online skins per licensee, a system to allocate licenses to tribes must be devised, public feedback needs to be collected and considered, rules must be finalized, the application process opened, submissions reviewed, and operating systems tested.
There’s no way that regulators in the Grand Canyon State could achieve all that within such a limited time frame.
Thus far, the Arizona Department of Gaming, which is responsible for assembling and shaping the state’s regulated sports betting market, has met the challenge successfully. The application period started on July 26, which is also when the regulations were confirmed. In the forthcoming weeks, the ADG will evaluate applications, conduct essential background checks and due diligence, test operational systems, and distribute licenses to eligible entities.
The task that once seemed unthinkable – constructing a legal sports betting industry from scratch in less than five months – now appears increasingly achievable.
The emergency clause in the Arizona sports betting bill was crucial.
Undoubtedly, Arizona regulators were under increasing pressure. Despite the praise for the law’s passage in April from residents, lawmakers, and sports betting operators, the ADG had a task to fulfill.
Ducey signed a bill that included an emergency clause, which was immediately enacted as soon as the compacts were approved by the federal government in late May. He also approved agreements with each individual tribe. The clause aimed to provide the ADG sufficient time to develop rules and regulations for the newly legalized sports betting industry, with the aspiration to launch the first sportsbooks by early September.
Six days post Ducey’s signing, the ADG put forth a “tentative rule drafting and operational timeline”. Although no commencement date was declared, the department indicated that the rule-making process had already been initiated.
Hartgraves acknowledged that meeting the early September goal involved some pressure. “We’re establishing an industry that typically takes years to set up, not to mention the rule-making process that usually spans one or two years, but in our case, it was condensed into five or six months. So yes, there was certainly pressure,” he said. However, he remained optimistic stating, “We remained confident throughout. Our experience in the gaming sector certainly helped with the transition. We were fully prepared for the challenge.”
Hartgraves attributed some of their confidence to the fact that they did not have to endure a typically long and challenging review process with the senior management. He explained, “Usually, there’s a substantial process, including time-limited public comments and other mandatory steps… But we bypassed all that.”
AZ regulators finalize sports betting rules at a rapid pace.
Regulators acted quickly, releasing the initial draft of sports betting rules on June 15. This was followed by virtual hearings and a period for written comments. In just a few weeks, another draft was released, which again led to more virtual meetings and opportunities for written comments. This cycle was repeated twice more.
Hartgraves stated, “We aimed for maximum transparency and I believe we achieved it. We organized virtual open comment sessions and actively sought stakeholder feedback. I would say the most significant aspect was avoiding the entire obligatory rule-making process, which truly fast-tracked everything for us.”
The ADG finalized the rules and regulations for sports betting, as well as the license allocation process, by July 26. They then forwarded these rules to the Arizona Secretary of State and commenced the application process. Initially, it seemed unlikely that sports betting would be launched in Arizona by September 9. However, by initiating the application process on July 26, the regulators provided themselves with over six weeks to complete application reviews, tests, background checks, and all other necessary steps to launch the first sportsbooks.
Hartgraves stated that it’s clear we’re entering a fast-paced licensing period. He believes that all stakeholders knew this would be a swift process. He mentioned that they have made efforts to keep everyone informed and that the process has been generally smooth to date.
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