Phoenix Rising FC, a second-level pro soccer team, is angling to become the first non-major league sports entity in the U.S. to offer sports betting. Representatives from the club, a member of the United Soccer League (USL), were among those in attendance on Monday’s Arizona Dept. of Gaming (ADOG) webinar that laid out the process for how potential applicants could vie for the state’s three remaining event wagering slots.
During the meeting, ADOG chief Jackie Johnson laid out a timeline for the new licensees, who would go live by the first quarter of 2024, if not earlier. The application window is open from Aug. 1 to Aug. 15.
From there, the regulator will take two weeks to decide which applicants meet the qualifications. If there are more than three applicants, the ADOG will have until Sept. 12 to determine which three to award licenses to. Once that decision is made, the franchises and their operator partners will have 180 days to launch.
In Arizona, sports franchises that compete at the highest level available in the state are eligible to apply for licenses. Because there are no Major League Soccer teams in Arizona, USL is the highest level of pro soccer available. For comparison, if the rules were the same in North Carolina, the Triple-A Durham Bulls, a Tampa Bay Rays farm team, would be eligible because there is no Major League Baseball in North Carolina.
Why licenses are available
In April 2021, Arizona lawmakers legalized event wagering by allotting 20 licenses in the state — 10 each to Indian Country and the state’s professional sports teams. But when it came time for the ADOG to award those licenses, it was clear that there were not enough for the state’s more than 15 tribes and too many for the professional sports teams.
At the outset, all 10 tribal licenses were allocated, while only eight pro-team licenses were. Since 2021, one tribal license became available after Fubo Sportsbook folded and the Ak-Chin Indian Community forfeited its license. The tribe already has a partnership with Caesars, which operates a retail Harrah’s casino on the reservation.
Among the pro sports’ franchise licensees are an arena-league football team, the first of its kind in the U.S., as well as a license for the WNBA Phoenix Mercury, one of the first two of its kind. Phoenix Rising and FC Tucson, also in the USL, are potential candidates for the final two pro franchise licenses.
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Representative from Phoenix Rising were on Monday’s call, and though they did not reveal a potential partner, founding co-owner Tim Riester asked if a previous application fee could be applied to the current application. (Phoenix Rising was denied a license in 2021.) The answer was that application fees are non-refundable and a new $100,000 fee would be required.
— Dan Nowicki (@dannowicki) July 12, 2023
Will Fanatics try for Arizona?
In terms of other fees, they remain the same as they did in 2021 — $750,000 for an event wagering operator (the team or tribe) with a $150,000 annual renewal, and $750,000 for a “designee” (sportsbook) with a $150,000 annual renewal. Application fees will be credited toward the initial fee in either case.
The three new licenses could open a pathway for Fanatics Sportsbook to gain entry into the state. The company recently announced a deal to acquire PointsBet’s U.S. division. PointsBet is not currently licensed in Arizona. Its partner, Castle Creek was initially awarded a license in 2021, but it was rescinded days later.
The ADOG at the time said the initial issuance was an “administrative error.” Should Castle Creek reapply and get licensed this time, Fanatics could gain entry through the new deal, or it could partner with another applicant.
Representatives from multiple potential licensees were on Monday’s call, including those from FanDuel, which is already live through a partnership with the NBA‘s Suns, and bet365, which is not available in Arizona. The top major operators — Barstool Sportsbook, BetMGM, Caesars Sportsbook, DraftKings, FanDuel, and WynnBET — are all live with retail and digital wagering.