What happened the week of Feb. 13-17 in Pierre was not just an issue pertaining to sports betting. It was an issue that shed a light on how we are governed and what we accept as citizens in how we are governed. 

We saw firsthand what happens when the basic foundation of our government is not followed. Abuse of power is seen when any Branch oversteps its bounds, independent of the issue or the political party. These abuses will continue to happen until the other branches, or the public, stand up and stops them. 

These actions are not consistent with our constitutional republic, which is a system in which people delegate their responsibilities to elected representatives in government to make decisions. Each branch of our government has its role: the legislative branch makes the laws, the judicial branch interprets the laws and the executive branch enforces the laws. The South Dakota Constitution is based upon the structure of the U.S. Constitution. 

On Wednesday, Feb. 15, HJR 5006 was heard during the House Commerce and Energy Committee. HJR 5006 was a bill pertaining to permitting the voters to amend the Constitution to allow mobile sports betting (as depicted in the image above from depaul.org) during the next general election in 2024. It was not a bill to make mobile sports betting legal.

The House committee heard testimony from proponents and opponents prior to their vote. Proponents included licensed South Dakota operators in the industry, national experts in the industry and Deadwood gaming leadership. Opponents included parties who have moral objections to gambling and lawyers from the Department of Revenue. The Department of Revenue is an entity that operates within the executive branch of government whose role is to enforce the laws, not to make laws.

I understand the DOR is in the same branch of government as the South Dakota Commission on Gaming, therefore it should be watching the proceedings in the interests of the Commission on Gaming, but its positions and statements need to be accurate.  

Their interpretation of the Constitution is no more binding than my interpretation or any other citizen’s interpretation. The legally binding interpretation is done by the judicial branch and the South Dakota Supreme Court.

During the hearing, Dor Lawyers made multiple arguments and incorrect claims that had to be corrected by proponents during rebuttal. When these statements were corrected by evidence, the committee members thanked industry experts for the clarity provided.

DOR lawyers made incorrect statements about security of the mobile apps, the sign-up process, the geo-location of players using the apps and assurance that players were over the age of 21 to participate. All these incorrect statements were corrected by industry experts who showed how these were non-issues in the other 30 states allowing mobile wagering. 

The DOR lawyers used their testimony as a platform to explain their interpretation of the constitutionality of the bill. This specific bill was a joint resolution to simply put the issue on the ballot and allow the voters to decide the issue. Why the constitutionality was even argued in this setting is questionable.

If there was an unconstitutional component of the events that day, it would have been the fact the DOR was directing policy and overstepping their role as defined by the Constitution. The DOR lawyers used their perceived credibility on this specific issue to influence lawmakers. They overstepped their role in the executive branch by trying to dictate how laws were made and how the Constitution should be interpreted.

Had these individuals represented themselves in a personal capacity, they would have every right to present their positions, but these lawyers represented themselves in a professional capacity with the perception of credibility and the full power of the executive branch of government behind them. The committee voted 7-6 to pass the resolution. 

The hearing can be listened to here:

Then on Thursday, Feb. 16, the bill was caucused and voted on the House floor. The time between when the committee concluded on Wednesday and when the session started on Thursday is when the Department of Revenue lawyers really went to work to lobby and influence lawmakers with their interpretation of the Constitution with their incorrect, inaccurate information. 

Below is a snippet of the talking points the DOR lawyers used to influence lawmakers: 

1) They claimed it does not include a “within the state of South Dakota” phrase, which would require the sports wagering to occur within South Dakota.

2) The proposed language would permit sports wagering bets to occur anywhere in the United States, or anywhere in the world, if the bets are funneled through a computer in Deadwood 

3) Referencing the Interstate Wire Act, they questioned whether the law even permitted this.

The DOR lawyers continued to dispense disproven claims in committee. Then they took it a step further with their talking points sheet they shared. 

These are not claims that can be argued based upon legal interpretation, they are inaccurate! The verbiage in the bill has nothing to do with the items listed on their talking points sheet.

Any wagers placed via this bill are done through licensed companies, with licensed servers in licensed locations “within the city limits of Deadwood” overseen by the Commission on Gaming. There is no chance there will ever be a wager placed on mobile devices outside South Dakota.

The rules that the Commission on Gaming would implement would be similar to the 30 other states that are already doing this. The DOR should know this. 

The Commission on Gaming is within the executive branch. Its role is to enforce the law and oversee all aspects of gaming. One of the biggest issues in the DOR’s position is that they are saying the Commission on Gaming does not know how to do their job, thus the concern over the possibility that “… sports wagering bets occur anywhere in the world …”

I can assure you, as a holder of a license bestowed by the Commission on Gaming, commission staffers are competent. They do their job very well in a respectful, knowledgeable and professional manner.

It is currently the Commission on Gaming’s job to regulate slots, table games and every other form of permitted commercial gambling in South Dakota as directed in previous resolution-driven amendments to the Constitution. Mobile gaming would be no different. That is why the bill was introduced in the Legislature; it’s their job to make the laws. The reason why the Legislature followed the resolution pathway in this case was because in an alternative path, the petition option, an outside third-party dictates the language of the law. Once again, it’s the legislative branch’s role to make the laws. 

To even ask the question, “Does federal law even permit this?” is an alarming overstep by the DOR lawyers! It is scary to think the executive branch would do this based on one of two reasons: perhaps they don’t know the law, or maybe they misunderstand the law. For the lay-person, in a nutshell, in 2018 the U.S. Supreme Court ruled on PASPA, the Professional and Amateur Sports Protection Act. This ruling allowed states to make their own decision as it pertains to sports betting as they see fit. Thus far 36 states have done this.

In South Dakota specifically, as it stated in the verbiage of HJR 5006 and a subsequent amendment to the Constitution, it is all spelled out. The Commission on Gaming would provide the oversight just like it has for slots, table games, etc and the verbiage in the amendment is clear. For the Department of Revenue’s lawyers to infer that this legislation is in violation of the Interstate Wire Act is wrong. When PASPA was overturned by the Supreme Court it carved out any potential conflicts with the Interstate Wire Act! I believe that incorrect information from DOR lawyers misled lawmakers and influenced them to vote No on HJR5006. The final House floor vote was 41-28 in opposition and the bill was killed. 

Thursday’s House proceedings and vote can be heard via this audio recording: 

I respect state Reps. Mills, Hansen and other lawmakers who are against gaming and voted based upon that moral stance. However, I am frustrated by the fact that they won’t let their constituents vote on the issue. Hansen and Mills clearly came out and stated their position in a consistent manner. I do respect that. But I believe that there were lawmakers who were influenced and voted no based upon incorrect information coming from a source they unduly trusted.

All it took was eight lawmakers to be swayed and that’s what happened. Thus, the general public was silenced on this issue. The resolution path for the voters to decide this issue as outlined in the Constitution was blocked by the DOR legal team’s actions.

So the bigger question is, what is next? This isn’t an issue of the morality of sports betting or not, and it isn’t a question of should HJR 5006 be passed or not. The question is, will the legislative branch allow the executive branch to continue to overstep their role as stated in the Constitution? Will the voters allow the legislative branch to continue to lay down and accept these tactics?

Once again, this issue is much bigger than mobile sports betting. 

I challenge the legislative branch to stand up for itself and the voters that elected them and demand these actions stop! Why else are they in public office?

Garrett Gross of Harrisburg is the president and co-founder of the Dakota Gaming Group and the operator of BETKOTA Sportsbook.