Have Promotional Lobbyists Hurt Chances of Oklahoma Sports Betting?

Every conversation about the chances of sports betting in Oklahoma usually begin and end with the rocky relationship between the state's tribes and the governor's office. But what if more mitigating factors are at play?

In the wake of the latest failed attempt to legalize Oklahoma sports betting, this is one theory that's started making the rounds. In particular, many industry experts are starting to wonder whether promotional lobbyists have actually held back sports gambling efforts—not just in Oklahoma, but elsewhere, too.

Are these typically sports-betting-operator-backed figures potentially impeding the future of legal gambling in The Sooner State? Let's explore.

What are Promotional Lobbyists, and How Might They be Impacting Oklahoma Sports Betting?

Promotional lobbyists are individuals who represent the interests of sportsbooks looking to enter a certain market. More specifically, their mission is to protect and advance a singular agenda: tax deductions for bets placed with promotional funds.

Anyone who has spent time perusing the top online sportsbooks in the United States has probably also spent time browsing through sections on the best online sports betting bonuses and promotions for each individual operator. These offerings usually feature some sort of "free money" in the form of free bets or deposit matches.

Some sites, for instance, will match 100 percent of your first deposit up to a certain amount (say, $500). These transactions are what promotional lobbyists target. In this case, their job is to push for Oklahoma sports betting legislation that not only green lights online wagering but also allows licensed operators to write off transactions processed using these promotional funds.

This is considered an especially critical aspect of negotiations, across all states. It's especially pivotal when talking about the initial rollout of legal sports betting. That's when the best online betting sites inundate the public with aggressive welcome bonuses. At that point, they are trying to both establish a client base in a new market while beating out a handful of competitors who are doing the same.

If Oklahoma is willing to make those promotional offerings a tax deduction, sports betting operators will in turn be even more aggressive with their bonuses. While many states have previously been quick to acquiesce to these promotional lobbyists, the decision will significantly impact their bottom line, even if only on a temporary basis.

Oklahoma is Paying Special Attention to how Promotional Deductions are Received in Kansas

Kansas recently transitioned into legal sports betting and offered operators deductions for promotional wagers. Officials in Oklahoma have been watching the results closely. This includes the negotiations that even led up to this point. "It was probably the biggest ask from lobbyists was that they would be allowed to deduct promos,” said John Holden, an associate professor in the Spears School of Business at Oklahoma State University, according to the Wichita Beacon.

Responses to Kansas' decision were naturally mixed. But they skewed toward the pessimistic end after the Kansas City Chiefs won the Super Bowl. As the preferred team among NFL fans in Kansas, bettors flocked towards Super Bowl betting odds. It matters a great deal when a "local" team is involved in a championship sporting event.

And yet, Kansas failed to turn any real profit relative to the interest. According to the Wichita Beacon, over $194 million was bet on the Super Bowl among people who live in Kansas, but the state received less than $1,134 in sports gambling revenue for that entire month. 

Part of that low figure is on the outcome. Many people in Kansas bet on the Chiefs to win the Super Bowl, which they did. But repressed returns were also owed to an uptick in promotional-bet deductions.

Officials in Oklahoma took notice of these returns, and they were subsequently discussed during the 2023 legislative sessions. Certain policymakers seemed unconcerned. Others proposed that Oklahoma sports betting follow Colorado's lead. Colorado recently became the first state to get rid of promotional deductions for operators. Could Oklahoma do the same?

In the End, Oklahoma Sports Betting Still Has More to Do with Governor Kevin Stitt

Promotional lobbyists will no doubt shape the Oklahoma sports betting discussion during the next round of debates, which won't happen prior to the 2024 legislative meetings. But their agenda-pushing is a secondary concern. For now, the relationship between Governor Kevin Stitt and the state's tribes are more pressing.

That much has been made clear over and over again. Most recently, many supporters of Oklahoma sports betting pushed the governor to take action and start a more frequent and open dialogue with the state's tribes. Whether this call for action is successful remains to be seen.

To be sure, both the governor and the tribes have repeatedly said they're ready to talk shop with the other. But that's different from a reconciliation. And given that Oklahoma tribes still have exclusivity over gaming rights, this is by far the biggest potential hangup in the sports betting debate. 

All these sports gambling initiatives that make their way to the House of Representatives and Senate matter very little if the tribes aren't on board. If and when they officially support an Oklahoma sports betting bill, that's when focus can shift to secondary hurdles, such as promotional tax deductions and many other terms of engagement. Until then, the future of Oklahoma sports gambling is in the hands of Governor Stitt and the tribes more so than anyone else.

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