The final form of Tennessee’s sports betting rules is yet to be decided, but new comments from a couple of meetings earlier this week could shed light on the state’s plans.

Authorities are listening keenly

At the Tennessee Lottery Board of Directors meeting, the decision to raise the fixed payout cap on sports wagering was made. After this decision, the cap is now 92% instead of the earlier proposed 85%. There were several responses to this clause as it required all licensed operators in the state to keep a minimum of 85% of all wagers placed.

This would make sports betting in the state similar to pari-mutuel takeout of a fixed matrix lottery product. However, sports betting is a lower margin venture, and the sheer number of wagers in terms of dollar value could be quite high. The states of Nevada and New Jersey are a prime example of the multi-million-dollar wager totals.

The Tennessee Education Lottery Corporation (TELC) and the nine-member Tennessee Sports Wagering Council took these issues into account during the meeting. Note that no state in the US, which has legalized sports betting, has placed a minimum hold requirement for operators. However, TELC Chief Rebecca Hargrove said that such rules are prevalent in Switzerland, Greece, and France.

What to oddsmakers suggest?

According to odds making veteran from Las Vegas Robert Walker, some operators would move away from the Tennessee market because of this cap because the annual license cost is already $750,000. Others may accept the regulation and come up with a way to meet these requirements. He called the 92% cap a “less untenable” position. He added that a mandatory hold would suffocate the competition.

The state of Nevada, which has the most extensive experience in sports betting, holds less than 8% on its books. Capping the hold will not just remove large straight bets from the state but would also push players to offshore locations. The measure would also impact revenue for these businesses.

But even with some issues, the state seems to be going in the right direction. The board and council appear to be very fluid in their assessment. So far, the draft rules received 37 comments on the capped payout and 60 on another rule that considers a tie in a parlay as a loss. The 20% tax rate at the state is another highly commented on a clause in the regulations. We will have to wait longer to see the final results of the discussion and public comments.