Arkansas Takes First Steps Toward Legalizing Online Casinos

The movement to legalize online casinos in Arkansas officially began on March 19 with the introduction of House Bill 1861 (HB 1861), a proposal to amend the state’s constitution and expand the offerings of its gambling industry. The bill, sponsored by Representative Matt Duffield and 13 other co-sponsors, would allow licensed casinos in the state to offer online table games, live dealer games, and online slots. It also seeks to crack down on unlicensed gambling, increasing penalties for illegal operators.

As Arkansas embarks on this journey, HB 1861 is expected to ignite debates on several fronts—most notably whether a constitutional amendment is truly necessary for iGaming to become legal, and how such a move could affect the state's existing land-based casinos.

The Rise of iGaming in Arkansas

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The proposal to legalize iGaming is the latest chapter in a growing national trend, where more states are moving toward online gambling. The push for online casino play in Arkansas, however, is not without its challenges. For one, HB 1861 includes provisions that target illegal gambling operations, particularly sweepstakes-based casinos, elevating the penalties for these activities to a Class D felony. A conviction could result in up to six years in prison and/or a fine of up to $10,000.

Proponents of iGaming argue that the state’s licensed casinos should have the ability to offer online casino games as part of the next step in modernizing Arkansas' gambling industry. The bill is currently under review by the House Judiciary Committee, though there is no corresponding measure in the Senate as of yet.

A Divided Industry

The state's casino industry is not unified on the question of online gambling. Currently, Arkansas is home to three land-based casinos: Saracen Casino Resort, Oaklawn Racing Casino Resort, and Southland Casino Hotel. Of these, Saracen has emerged as the most vocal proponent of iGaming, with Chief Marketing Officer Carlton Saffa strongly supporting the expansion of online gaming in the state. He believes that digital casinos could boost the state's gambling revenues, potentially driving more revenue from out-of-state players and creating a new, modern gaming experience for local players.

However, Oaklawn Racing Casino Resort has expressed its opposition to the legalization of online casinos. The resort’s representatives argue that iGaming would negatively impact the casino’s land-based revenue. This division within the state’s casino industry highlights the uncertainty surrounding the economic impact of online gambling, with some stakeholders concerned that online gaming could cannibalize the revenue from traditional in-person gambling experiences.

As HB 1861 progresses, the position of Southland Casino Hotel remains unclear, though the bill’s passage through the legislature may force the casino to take a more public stance on the issue.

A significant element of HB 1861 is its approach to regulating and curbing unlicensed gambling in the state. The bill targets “dual-currency” sweepstakes-based casinos, which use a payment system that allows players to exchange currency for prizes or cash equivalents, simulating casino-style gaming or sports wagering. These types of unlicensed operations have been a concern for lawmakers, and the bill seeks to classify them as a Class D felony, thus increasing penalties and discouraging such activities in Arkansas.

While the bill's provisions on illegal gambling are designed to protect licensed operators and prevent the spread of unregulated gambling, they could face legal challenges if passed. Critics may argue that the definition of sweepstakes casinos and their applicability could be subject to court disputes, particularly if HB 1861 does not fully enshrine iGaming in the Arkansas Constitution, as some believe is necessary for such a change.

Tight Legislative Calendar

The timeline for the passage of HB 1861 is tight. The Arkansas legislature operates on a biennial schedule, and the 2025 session is set to end on April 11. This leaves proponents of iGaming just over three weeks to pass the bill through both chambers of the legislature and secure the approval of Governor Sarah Huckabee Sanders. Should the bill fail to pass this year, 2025 could serve as a year to gauge the political climate and build support for future efforts.

The tight legislative window means that HB 1861 will likely serve as an introduction to a broader conversation that began earlier in the year when Senator Bryan King filed a proposal to amend the state constitution in January. The growing debate over the legalization of online casinos in Arkansas is expected to intensify, with various stakeholders—including casino operators, lawmakers, and advocacy groups—pushing their respective positions.

HB 1861 makes a strong move to deter unlicensed gambling, specifically sweepstakes-based online games. A conviction could result in up to six years in prison and/or a fine of up to $10,000.

Looking Ahead

While it remains to be seen whether HB 1861 will make it through the legislature in 2025, the introduction of the bill signals that the conversation around iGaming in Arkansas is well underway. The potential economic benefits of online gambling, alongside the growing interest in digital gaming nationwide, could lead Arkansas lawmakers to take a more serious look at how to integrate iGaming into the state’s gambling landscape. However, with divided opinions within the industry and a tight legislative timeline, the future of online casinos in Arkansas remains uncertain.