DC Weighs Online Casinos While Targeting Sweepstakes

Washington, D.C. lawmakers are reviewing legislation that would legalize online casino gaming in the district while banning sweepstakes-style platforms that use dual-currency systems.

Councilmember Wendell Felder introduced Council Bill 260656, titled the Internet Gaming and Consumer Protection Act. The proposal has been referred to the Committee on Human Services for further review.

If approved, the bill would create a regulated iGaming market overseen by the District’s Office of Lottery and Gaming. Regulators would also receive enforcement authority against operators offering products outside the legal framework.

Felder said: “This bill reflects a practical, data-informed approach to strengthening consumer protections, modernizing our gaming framework, and capturing revenue that is currently flowing outside of the district’s oversight.”

Proposed Market Includes Multiple Casino Games

Licensed operators would be allowed to offer blackjack, poker, roulette, and slot games to customers aged 21 or older who are physically located within the district.

The Office of Lottery and Gaming would supervise identity verification, geolocation controls, and cybersecurity standards. The proposal does not place a limit on the number of operator or supplier licenses available.

Operator applicants would pay a $2 million application fee. Licenses would remain valid for five years, with renewals set at $500,000 for the same term.

The bill would apply a 25% tax on adjusted gaming revenue and allow negative gaming revenue to carry forward month to month.

Felder said district residents wagered an estimated $700 million with offshore and unregulated gaming platforms during 2024. He added: “These figures make clear that iGaming is not a new activity—it is already occurring. The policy question is whether the district will regulate it effectively or allow it to remain unregulated.”

Revenue Distribution and Local Spending Rules

Under the proposal, the first $500,000 in tax revenue from online platforms would go to the Department of Behavioral Health for addiction prevention, treatment, referral, and recovery services.

After that amount, remaining revenue would be split among several agencies. The Department of Insurance, Securities and Banking, the Office of Victim Services and Justice Grants, and the Department of Employment Services would each receive 30% allocations. The Department of Health would receive 10%.

Operators would also need to direct at least 35% of their local budgets to District-based businesses or face penalties. Additional charges would support a Community Reinvestment Fund focused on financial counselling, public health research, victim services, and workforce programs.

Sweepstakes Sites Face Direct Restrictions

The measure separately targets sweepstakes platform models that use multiple forms of currency, credits, points, or tokens where one or more can be redeemed or converted into cash, prizes, or equivalents.

Regulators could issue cease-and-desist orders against unlicensed operators. Civil fines could reach $100,000 per violation, while repeated breaches may trigger penalties of $500,000. The District’s Attorney General would also be able to seek restitution and disgorgement.

Even if approved by the council, the bill would still face a 60-day congressional review under the Home Rule Act. If no action blocks the measure, regulators would then have 90 days to prepare rules, with a potential launch within 180 days depending on readiness.

Felder said: “Inaction carries real consequences. Without a legal framework, revenue continues to flow to unregulated operators, consumers remain exposed to risk, and the district falls behind neighboring jurisdictions that are moving forward”.

Source:

DC Moves on Online Casinos, Targets Sweepstakes, news.worldcasinodirectory.com, April 14, 2026