Washington, D.C. is considering a major shift in its gambling laws through legislation that would legalize online casino gaming while banning sweepstakes-style gambling platforms operating outside regulated systems.
Council Bill 260656, the Internet Gaming and Consumer Protection Act of 2026, was introduced on April 9 by Councilmember Wendell Felder and referred to the Committee on Human Services, with a hearing set for April 21.
The proposal places oversight with the Office of Lottery and Gaming (OLG), which would regulate licensing, compliance, identity verification, geolocation controls, and cybersecurity standards.
Licensing Rules and Revenue Model
Operators would need a $2 million five-year license, with $500,000 renewals. Supplier licenses would cost $50,000, later renewing at $25,000. Existing sports betting operators may receive expedited review based on prior approvals.
Companies would be limited to two brands unless the regulator grants exceptions. Applicants must also submit local business plans requiring 35% of District-related spending through certified enterprises.
The bill sets a 25% tax on adjusted gross revenue. The first $500,000 per month would go to behavioral health services, with additional funding supporting public health and addiction programs.
Responsible Gaming Rules and Consumer Safeguards
The legislation includes a wide range of consumer protection measures. Operators would be required to offer deposit, spending, and loss limits on daily, weekly, or monthly bases, as well as session controls, cooling-off periods of at least 72 hours, and self-exclusion tools.
Additional requirements include real-time access to account activity, session reminders, and procedures allowing third-party exclusion requests. Operators would also be restricted in how promotional spending and tax deductions are applied during the early years of operation.
Councilmember Felder said: “The scope of this activity is significant,” citing an estimated $700 million wagered by District residents on unregulated platforms in 2024.
He also stated: “iGaming, online casino-style games such as blackjack, poker, roulette, and slot-style games played on mobile devices or computers, is already accessible to District residents through unregulated and offshore platforms,” highlighting risks tied to lack of oversight.
Sweepstake Casinos Targeted for Ban
A central element of the bill is the outright prohibition of sweepstakes casinos, which use dual-currency systems that can be exchanged for cash or prizes. Lawmakers argue these platforms operate in a regulatory grey area while replicating casino-style gambling.
The OLG would be granted enforcement authority, including the ability to issue fines of up to $100,000 per violation or $500,000 for related breaches. It could also issue cease-and-desist orders and pursue court action, while the Attorney General could seek civil penalties and restitution.
Broader Context and National Trends
If approved, the District would join a small number of US jurisdictions moving toward regulated iGaming, following New Jersey and Michigan as reference points for structured online casino markets. Regulators would have 90 days to finalize rules, with a potential launch within 180 days.
The proposal also comes amid a growing national push against sweepstakes gaming. Several states, including Maine, have already enacted bans, while others continue to debate similar measures.
The D.C. proposal now awaits committee review, followed by potential Congressional oversight before any implementation timeline can begin.
Source:
“D.C. Seeks to Legalize iGaming, Outlaw Sweepstakes Casinos”, finance.yahoo.com, April 13, 2026
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