Arkansas Casinos At Odds Over DraftKings, FanDuel Effort To Expand Into State
One of Arkansas' three casinos opposes an effort by the other two to allow DraftKings and FanDuel to operate in the state.
On Thursday, the Arkansas Racing Commission is set to hear a proposal by DraftKings and FanDuel to offer their mobile sports betting platforms statewide. The Racing Commission regulates all gaming in Arkansas, including casino gambling, sports betting and horse racing.
The hearing is scheduled for 11 a.m. CT on Thursday (Feb. 26) in Little Rock. The meeting agenda, finalized Tuesday afternoon, includes the DraftKing and FanDuel applications to operate in Arkansas.
Opposition from Carlton Saffa, chief market officer at Saracen Casino Resort in Pine Bluff, points to a battle over authorizing these national sports betting companies to operate in Arkansas.
“The potential of FanDuel and DraftKings in Arkansas deserves serious scrutiny and fails to pass any basic smell test,” Saffa told Gambling.com this week.
He said the effort by DraftKings and FanDuel to enter the Arkansas market is “truly bizarre” in that it raises questions about compliance with the Arkansas Constitution.
“Only four years ago, all three Arkansas casinos and the seven-member Arkansas Racing Commission agreed that sports betting was something that should only be conducted and controlled by the casinos themselves, and not by a third party,” Saffa said in an email. “The commission rightly recognized that a casino cannot loan out its license to a third party and collect a check from the gaming activity occurring from a proxy actor.”
In the email, Saffa cited a 2021 letter from Oaklawn to the commission, indicating that the public vote in 2018 to approve Amendment 100 to the Arkansas Constitution allows only the state’s licensed casinos to accept wagers on sporting events.
DraftKings plans to partner with Southland Casino Hotel in West Memphis, while FanDuel hopes to partner with Oaklawn Racing Casino Resort in Hot Springs.
Wayne Smith, Oaklawn's general manager, sent a letter to the commission this year on Jan. 27, stating that its proposed partnership with FanDuel is in compliance with the Arkansas casino gaming rule.
"This arrangement will reflect a traditional platform-services model where FanDuel will act as Oaklawn Sports sports-betting platform provider, supplying an all-in-one technology and operation support required to offer online sports wagering to people located in Arkansas," Smith wrote.
National Partners Required To Share 51% Profits
All three Arkansas casinos—Saracen, Southland and Oaklawn—already offer their own branded sports-betting apps and can partner with another company on a second app, state officials said.
The locally operated apps are BetSaracen (Saracen), Betly Arkansas (Southland), and Oaklawn Sports (Oaklawn). Oaklawn, home of a historic horse track, also operates a horse-racing wagering app, Oaklawn Anywhere. On a monthly basis, BetSaracen for the past four years consistently has been the market leader in handle and net win.
With approval, DraftKings and FanDuel, the nation’s leading mobile sports betting operators, would be the first national sports-betting companies to do business legally in Arkansas. Southland is owned by an out-of-state company, Delaware North of Buffalo, New York, but the company has an Arkansas casino license.
In late 2021 and early 2022, Saffa was instrumental in winning approval of a rule requiring national operators to partner with an Arkansas licensee if operating in the state. That partnership would require the national operator to share 51% of profits with the local casino partner. Saffa contended that national betting operators otherwise would take most of the profits out of Arkansas.
Saffa recently noted that Attorney General Tim Griffin has issued an opinion, stating that prediction market platforms should be licensed in Arkansas. DraftKings and FanDuel offer a prediction market component in some states, but their current Arkansas applications are for sport-betting apps, not prediction market platforms.
If approved in Arkansas, DraftKings and FanDuel can begin operating sports-betting platforms across the state immediately. Draft Kings and FanDuel already operate in three states that border Arkansas. Those states are Missouri, Tennessee and Louisiana. Tennessee is an online-only state.
