New Bill Seeks to Legalize Online Casinos in Hawaii

Senate President Ron Kouchi introduced Senate Bill 1507 to create the Hawaii Lottery and Gaming Corporation, which would manage online gaming activities.

SB 1507 does not include sports betting and would make the Hawaii Lottery and Gaming Corporation tax-exempt. The bill ensures that any revenue goes into a Lottery and Gaming Special Fund to support community projects, highlighting the corporation's role as a key government service.

What Would SB 1507 Change in Hawaii?

Senator Kouchi's bill would not only create the Hawaii Lottery and Gaming Corporation, it would allow it to partner with an online gaming provider to offer games of chance and skill, including

• Lottery
• Poker
• Casino games

However, this proposal does not cover sports betting, but it would allow the corporation to legally join multi-state gaming. There are currently five states in the Multi-State Internet Gaming Agreement (MSIGA). It connects Nevada, Delaware, Michigan, New Jersey, and West Virginia for online poker.

Pennsylvania is close to joining this network because by participating, a state expands its online poker offerings by linking with others. This increases player numbers and makes online casino games more attractive with bigger prize pools and faster gameplay.

The Hawaii Lottery and Gaming Corporation would be tax-exempt because it is considered an essential government service. A special fund would be set up to ensure that money generated from online gaming benefits the community.

If Senator Kouchi's bill is passed, it is set to take effect on July 1.

Sweepstakes Casino Also Part of Hawaii Online Gaming Bill

To boost tourism, the bill allows the corporation to offer "legally compliant free-play game and sweepstakes casinos". The sweepstakes casino games would offer  Hawaii-themed prizes to people outside of Hawaii.

Sweepstakes casinos are becoming more popular because they can legally operate in areas where traditional online gambling is restricted. They follow sweepstakes regulations, allowing them to offer a gaming experience similar to real-money casinos without being subject to the same strict regulations.

In addition to the online casino bill, other bills were introduced that could legalize activities like online sports betting and fantasy sports. HB1308 and its senate counterpart SB1569 would give the Department of Business, Economic Development and Tourism the authority to regulate sports betting.

Will Online Casinos in Hawaii Become a Reality?

This will mark the third consecutive year of lawmakers trying to get some form of gambling legislature passed.

• In 2022, Representative John Mizuno proposed a bill to set up a sportsbook on Oahu. The bill stalled due to opposition from lawmakers and community groups worried about social consequences.
• In 2023, a new bill aimed to legalize online sports betting through a few licensed platforms.
  Concerns over problem gambling and lack of regulation, along with opposition from cultural and religious groups, stopped the bill from advancing.
• In 2024, new bills (Senate Bill 929 and House Bill 2259) proposed wider frameworks for online gambling, including sports betting and online poker.

As you can see, Hawaii has a long history of introducing, and rejecting gambling legislation. It’s primarily due to concerns over problem gambling, cultural opposition, and regulatory challenges.

But if at first you don’t succeed, try again. We’ll have to wait and see if online casinos in Hawaii find new life under this recent bill.