South Dakota Governor Signs a Sports Betting Bill into Law

Five months ago, the residents of South Dakota overwhelmingly voted ‘Yes’ for Constitutional Amendment B to officially approve the pursuit of legal sports betting in the state. About a week ago, on Thursday the 18th of March, state governor Kristi Noem officially signed Senate Bill 44 into law, marking the start of the final lap of the legalization of sports betting in the Mount Rushmore State.

After the strong backing from South Dakota locals in November 2020, lawmakers kicked into full gear in 2021. The Senate set the pace by giving SB 44 the green light with a crushing majority vote of 32-2 early in February. A month later, at the beginning of this month, the House followed suit and okayed the sports betting bill with a vast majority vote of 58-8. 

The sports betting legalization baton has now been passed to the South Dakota Commission on Gaming and the Deadwood Gaming Association to work together and draft a framework for a legal market. After Governor Noem’s signature, Mike Rodman, the Executive Director of the Deadwood Gaming Association hinted that sports fans in the state could be placing their first bets by 1st September. 

Further, Rodman also disclosed that the regulator will likely have drafted a preliminary set of rules by mid-June, which will be passed on to the legislative committee for final approval. However, it’s worth pointing out that while SB 44 will not officially come into effect until 1st July, casinos in the state can start making preparations for the addition of retail sportsbooks.

What Will Sports Betting in South Dakota Look Like?

Like many other states in the United States including the likes of Rhode Island, Nevada, and Iowa (before the requirement was lifted), South Dakota has also adopted the in-person registration standard for new signups. After account creation, bettors will then have to be physically present in Deadwood casinos to place wagers on sports.

The specific in-person registration and on-premise betting clause per SB 44 reads:

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A person who opens an account for advance deposit sports wagering with an operator or route operator shall establish the account in person at the operator’s or route operator’s licensed gaming establishment within the city of Deadwood using an application approved by the commission.

Even though the bill restricts betting within Deadwood casinos, another part of the bill’s language seems to indicate that mobile sports betting may also be allowed outside the city. The SB 44 passage in question states:

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Any sports wagering may only be conducted on the premises of a licensed gaming establishment as approved by the commission within the city of Deadwood. Each operator or route operator that is authorized by the commission to conduct sports wagering shall install and maintain equipment that is approved by the commission to ensure that all bets are placed on the premises of a licensed gaming establishment as approved by the commission within the city of Deadwood.

When loosely interpreted, the wording indicates that as long as a mobile sports betting server of an operator is located in a Deadwood casino, then a mobile sportsbook would be allowed to take wagers from players anywhere in South Dakota. Hopefully, the state gaming commission and industry trade body will help with the translation of that particular clause.  Two other bills; House Bill 1231 and House Bill 1211, which exclusively permitted statewide mobile sports betting among other more lenient considerations were shot down by legislators. In total, there were four different bills tabled for the regulation of sports betting, but SB 44 is the only one that saw the light of day.

When it comes to the types of sports bets allowed in the Mount Rushmore State, locals can place wagers on just about anything. The only no-go zones for sports betting in the state are high school, minor league, and South Dakota collegiate events. Additionally, prop bets on individual college athletes are also prohibited by the sports betting law.

Tribal Casinos Will Get A Piece of the Sports Betting Pie

SB 44’s wording only sets the legal sports betting landscape in Deadwood alone, but it doesn’t mean that tribal gaming operators elsewhere in South Dakota will miss out on the action. That’s because the Indian Gaming Regulatory Act of 1988 allows federally recognized Native American Tribes to offer any form of gaming that is okayed by the state for commercial gaming facilities. Thus, on top of the 25 commercial casinos in Deadwood, all 11 tribal casinos will be offering sports betting. 

According to the Deadwood Gaming Association, the legal sports betting effort in Deadwood will create 150 new employment opportunities and fetch over $2.2 million in tax revenue for state coffers.