Tennessee legalized sports betting a year ago. Apparently, more than 12 months later, the details remain devilish.
Forget the relatively lofty $750,000 licensing fee — not as astronomical as Illinois' $20 million but 15 times Iowa's $45,000 — or the 20% tax rate the state will charge businesses it approves to host online betting sites in Tennessee.
It is clear that the chief hurdle in the future of betting in Tennessee is continued demand of a historically high 10-percent hold.
"This is an unprecedented requirement. No other state has a mandatory hold," Daniel Wallach said last week on "Press Row" on ESPN 105.1 the Zone. "This requirement at 10% would exceed the requirement of every other state. In the last 35 years Nevada has never touched or come close to a 10% hold in any month. Their highest hold was 7.89%. It will drive Tennessee residents to neighboring states or illegal markets and end up costing the state significant and untold amounts of revenue."
Some clerical work here. A "10% hold" means the state would require licensed betting hosts to pay 90 percent of winning bets. Two-sided bets — like betting on a coin flip — normally have odds of -105 or could range to -110, meaning you would bet $105 or $110 to win $100. According to The Action Network, a national betting and gambling news site, a mandated 10% hold would be closer to -125 for that $100 payoff. Certain months can yield higher and lower holds depending on the success of betting houses, but no state mandates a 10% hold.
As for Wallach, well, talking sports betting with him is a lot like having a question about Microsoft and having Bill Gates on the blower. Wallach is the nation's pre-eminent legalized sports wagering attorney. He founded Wallach Legal, America's first sports betting law firm, and is the co-founding director of the University of New Hampshire school of law sports wagering and integrity program.
Yes, the state lottery bigwigs can revisit the 10% hold in a year, which will almost assuredly be overturned. Betting companies can start to submit bids this week with approvals or denials coming in no more than 90 days.
Not having sports betting right now isn't a huge issue because we don't have sports right now.
How starved is the sports betting public right now? Even as the economy speeds downward, there were online betting options for "The Last Dance," the much-anticipated ESPN sports documentary Sunday night on Michael Jordan and his final title run with Chicago.
Yes, you could bet on a movie.
Want more? Vegas expects bets on Thursday's first round of the NFL draft to be 10 times what it normally handles on that event — and that's with casinos empty, mind you — and the handle will be akin to a normal actual prime-time, regular-season NFL game.
But live sports will come back at some point, and it will come back most likely without fans in the stands but with a whole lot of fanfare. So when the games return, Tennessee's sports gaming options have to be ready to roll.
"Online and mobile sports betting is going to thrive big time in the kind of fan-free, stadium-empty environment," Wallach said. "Think about the way sports is coming to roll out whenever sports returns, the 50,000 fans at an NFL game or a college game, they are going to be home watching the game on TV or a laptop or a phone, that will lead to more betting and more folks who have access to immediate wagering on their laptops and phones."
Will Tennessee be ready when the time comes? Considering the state's struggles so far, I wouldn't bet on it.
Contact Jay Greeson at email@example.com at follow him on Twitter at @jgreeson@tfp.