The D.C. Council on Tuesday narrowly authorized the city to grant a sole-source contract to run its new foray into online sports betting, a move that concerns critics who believe the lucrative deal should be competitively bid.
Lawmakers late last year legalized sports gambling at arenas, retailers and on a mobile app. But the city has a monopoly on mobile betting, which is expected to be the most popular way to place on wager and the biggest source of revenue.
The bill, which passed by a margin of 7-6, would allow the city to suspend competitive bidding rules and allow the Greece-based Intralot, which already has the contract to operate the D.C. Lottery, to also manage online sports gambling and related services. Lamakers have to approve it a second time before it can heads to the desk of Mayor Muriel E. Bowser (D), who supports it.
D.C. Chief Financial Officer Jeffrey DeWitt said a sole-source contract is preferred because under the normal procurement process, it would take more than two years to launch mobile sports betting and the city would forgo an estimated $61 million in revenue as a result of the delay.
But the city has a competitive bidding process for a reason, critics said, adding that it is designed to make sure taxpayers get the best deal and contracts are not steered to politically connected vendors.
Council member Jack Evans (D-Ward 2), who championed sports betting and the sole-source contract, insisted that any money saved by competitive bidding would be offset by the revenue lost while companies compete for the contract.
He also invoked a Tuesday night shooting at a bus stop that left five injured as a reason to suspend competitive bidding because a portion of sports gambling revenues are set aside for violence prevention programs, in adddition to early childhood care.
Council member David Grosso (I-At Large) said such critical programs should be funded by stable and predictible sources of revenue. Others said they were not persuaded that a sole-source contract was necessary to launch sports gambling quickly.
“We are rushing this process unnecessarily,” said Council member Elissa Silverman (I-At Large), who referenced the history of contracting scandals with the D.C. Lottery.
The bill was originally introduced as emergency legislation in January, but it did not have enough support to bypass normal legislative channels. Lawmakers held a public hearing on the bill last week where DeWitt said the sole-source contract was not politically motivated and critics warned that the city was setting a dangerous precedent.
“It came down to the money,” Evans said, explaining the final vote.
The D.C. Council on Tuesday also unanimously passed several bills to help local federal workers during future government shutdowns.
The Council passed emergency legislation introduced by the mayor that would allow the city to pay unemployment benefits to essential federal workers who must work without pay during shutdowns.
Bowser asked the federal government to grant the city that authority, but was denied.
The council also expanded an earlier measure that requires judges to stay evictions or foreclosures of federal workers who miss rent or mortgage payments because they are not paid during a government shutdown. On Tuesday, the council agreed to include public defenders who were inadvertendly left outof earlier legislation.
Both shutdown bills head to the mayor and can take effect when signed.
Another shutdown could be around the corner. The government is currently only funded through Feb. 15 while a group of federal lawmakers are working to reach an agreement on border security, the issue which prompted the record 35-day shutdown that ended in late January.