In 2018, a Supreme Court decision lifted the federal ban on sports betting. Since then, 22 states have adopted measures to legalize sports gambling. This election, South Dakotans will decide on Constitutional Amendment B, which would legalize sports betting in Deadwood.
Critics of sports gambling bans argue that federal laws have not restricted gambling but instead pushed players into untaxed, unregulated black markets. Amendment B’s supporters argue that it would encourage these players to return to a taxable, more-transparent avenue.
In February, the state Legislature voted on a Joint Resolution that would put the initiative on the ballot. Lorin Pankratz, a lobbyist for the Deadwood-Lead Economic Development Corporation, spoke in support of the measure at the Senate Local Government Committee.
“People in South Dakota are looking for […] additional gaming opportunities, and when they go [to other states], we are losing that opportunity for those things to occur in our own state,” Pankratz said. “That’s lodging, meals [and] entertainment dollars that we’ll lose.”
Under the South Dakota Constitution, for-profit gambling is highly restricted, except within Deadwood city limits. Revenue produced from gambling in the Black Hills town is supposed to go to “the Historic Restoration and Preservation of Deadwood,” but South Dakota News Watch reported in 2019 that the group that administers the money frequently distributes funds for historical projects across South Dakota. Supporters of the initiative argue that taxes on sports betting would bring additional revenue to the state for such projects.
District 4 Rep. John Mills, however, argued on the statehouse floor that the change would be a lapse in moral judgement.
“We’ve been on this journey for the last 40 years, where we’ve just embraced gambling. […] I just wonder where it is going to end?” Mills said. “Haven’t we seen the damage and destruction that gambling does?”
The South Dakota Licensed Beverage Dealers and Gaming Association, on the other hand, doesn’t believe that the measure goes far enough because carve-outs for Deadwood are unfair for other parts of the state. They said people from Sioux Falls frequently travel across state lines to spend money at the Grand Falls Casino & Golf Resort in Iowa, where sports-betting is legal. Statewide reform could bring that money back to South Dakota businesses.
Passing the initiative could also bring increased revenue for Native American governments and businesses, who could amend tribal regulations to permit sports betting in reservation casinos. Industry advocates argue that the opportunity to have sweeping reform of gambling in South Dakota is too important to be restricted to Deadwood.
“We have one chance to put this in front of the voters, […] and what we believe is that what should go in front of the voters is the option to offer this statewide,” said Matt Krogman, a lobbyist for the Licensed Beverage Dealers and Gaming Association.
Bob Ewing, the senator from Deadwood’s county, sponsored the resolution that created the ballot initiative. He said the bill doesn’t rule out betting outside of Deadwood and systems could be put into place where bets are sent to the town from around the state. But Krogman voiced concerns that if the initiative passes in its current form, legislators will be reluctant to pass laws that include areas outside of Deadwood.
One thing that is certain is if the bill passes, legislators will have broad authority to implement the amendment as they see fit. That would mean more debate between those who see South Dakota laws against gambling as burdensome and those who see them as emblematic of the state’s moral integrity.
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