Will New Mexico Online Sports Betting Ever be Legalized?

At one time, New Mexico sports betting was at the cutting edge of legal gambling in the United States. But not anymore. Such is the case when New Mexico online sports betting remains illegal. You could even make the case that The Land of Enchantment is now behind the eight-ball. Almost half of the United States has leaned into legal online sports betting. New Mexico, though, has continued to hold out.

It’s something of a bizarre turn when you consider how early the state was to the sports gambling party. The United States Supreme Court overturned the Professional and Amateur Sports Protection Act of 1992 back in May 2018. By October 2018, New Mexico had rolled out on-site sports betting to the public.

You might think a state so quick to pounce on the USA’s revamped gambling laws would be among the first to expand their initial operations. Especially when you consider how profitable sports betting in New Mexico has been to date. In 2022, the state made an estimated $380.5 million in tax revenue off gambling, according to AmericanGaming.org. This, of course, factors in other forms of gaming, but sports betting represents a huge chunk of that tally. And that amount of money is a pretty big deal for a region that ranks 36th out of 50 states in total population.

New Mexico online sports betting nevertheless remains off the table. But why? And for how much longer? Let’s explore.

Why Hasn’t There Been a Stronger Push for New Mexico Online Sports Betting?

This question can be answered in three words: casino gaming revenue. The state remains dependent on that revenue stream and has worried that the legalization of New Mexico online sports betting would dilute how much they’re making.

That view can seem upside down. But you have to look at it from every angle. Sure, permitting residents to bet with the best online sportsbooks in the United States should amp up sports gambling revenue. Mobile operators will have to pay out taxes to the state each year. But the presence of online sportsbooks and casinos would also, in theory, detract from the foot traffic and business given to every one of the state’s 26 casinos. 

This is where the debate gets a little messy. The state could still offset any on-site revenue losses through the online gaming industry, which is growing rapidly and already more lucrative in many regions. But the New Mexico economy also relies on the casino industry to generate jobs. According to AmericanGaming.org, approximately 17,300 jobs inside the state were tied to the casino gaming industry last year. Lowering that number will put strain on workers and employers alike. 

Those are not positions that can be recovered with New Mexico online sportsbooks. None of the biggest mobile operators have their home base in the state. Even if they set up retail locations throughout the region, the legalization of online sports betting in New Mexico threatens to compromise a pretty big source of jobs.

Mobile Sports Gambling May Come to New Mexico Anyway

These concerns, while valid, may not keep online sports betting operators out of New Mexico for much longer. State officials have long been weighing the upsides and downsides of broadening the gaming industry, and the topic seems to have gained some momentum over the past 18 months or so. As Matthew Narvaiz wrote for the Albuquerque Journal, one of the most popular publishers in New Mexico’s largest city:

“The rise of legalized online sports betting might be closer to a reality in New Mexico as more states–including bordering state Arizona–have passed laws allowing for the placing of mobile bets within their respective states, and as younger people are finding new ways to enjoy wagering bets outside of the walls of casinos, state lawmakers and experts have said. Legalized sports betting would also open the door for the state's five racetrack casinos to benefit monetarily after years of decline in races, breeding and revenue.” 

The legalization of sports betting in Arizona, in particular, registered as a flash bulb moment. Though the rollout was completed two years ago, the conversation in New Mexico began picking up right around that time. Incidentally, this is when the state began more seriously looking into sports betting revenue projections. Narvaiz touched upon this in his piece for the Albuquerque Journal

“[A] report commissioned in 2018 by the New Mexico Consortium said the state would likely ‘generate approximately $1.2 billion in handle, or bets placed, and $61.1 million in net sports betting revenue annually should it be allowed throughout the state through bricks and mortar sports book locations in the state's casinos and also through mobile channels where patrons can bet anywhere within state borders." 

Fast forward to 2023, and this estimate is likely too conservative. Online wagers accounted for more than three-quarters of all legal bets placed last year in the United States. The mobile industry has exploded. These projections likely have, too.

What Will It Take to Legalize New Mexico Online Sports Betting? 

Dialogue has naturally picked up within legislative circles now that the state has a firmer handle on how lucrative online sports betting can be. But New Mexico can’t move forward in a meaningful way until they renegotiate their current gaming compacts with the local tribes. 

Successfully navigating those talks, if they ever happen, will be a tall order. Once more, the whole point of New Mexico’s present-day gaming laws is to protect tribal operations. The state will have to make it worthwhile to the tribes and their casinos to legalize online sports betting.

How New Mexico goes about doing that is anyone’s guess. That doesn’t lend itself to a concrete online sports betting timeline. Rest assured, though, the mobile gambling business has New Mexico’s attention. We’ll have to wait and see how long it takes to also gain their support.

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