Washington D.C. Online Casino Bill Takes Aim at Sweepstakes Too

Washington D.C. has taken a significant step toward legalizing online casino gaming. Councilmember Wendell Felder introduced the DC online casino bill — formally titled the Internet Gaming and Consumer Protection Act, or Council Bill 26-0656 — and the measure has been referred to the Committee on Human Services for review. It would open a regulated iGaming market in the District and, in the same move, shut the door on sweepstakes casino platforms operating there.

Felder framed the push around a straightforward reality: D.C. residents are already gambling online. An estimated $700 million flowed to offshore and unregulated gaming platforms from District residents in 2024. In his words, iGaming “is not a new activity — it is already occurring.” The policy question, he argued, is whether DC will bring it under proper oversight or leave it unregulated.

What the D.C. Online Casino Bill Proposes

The bill would place the District’s Office of Lottery and Gaming in charge of the new market. Licensed operators could offer blackjack, poker, roulette, and slot titles to players aged 21 or older who are physically located in D.C. Geolocation controls, identity verification, and cybersecurity standards would all fall under the regulator’s remit.

There is no cap on the number of operator or supplier licenses that can be issued. Operators would pay a $2 million application fee and receive a five-year license, with renewals set at $500,000 for the same term. The bill applies a 25% tax on adjusted gaming revenue, and negative revenue can carry forward from one month to the next.

Operators would also face a local spending requirement. At least 35% of their local budgets must go toward DC-based businesses, or they face penalties. The bill ties this condition directly to the license, making community investment a condition of operating in the market.

How the Revenue Would Be Distributed

The D.C. online casino bill sets out a clear revenue structure. The first $500,000 in annual tax income would go to the Department of Behavioral Health to fund gambling addiction prevention, treatment, referral, and recovery programs. After that threshold, the remaining revenue splits across several public 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% of remaining funds. The Department of Health would receive 10%. A Community Reinvestment Fund would also receive support, directing money toward financial counselling, victim services, public health research, and workforce development programs.

Felder projected that initial annual tax revenue could reach tens of millions of dollars. He added that those funds could grow as the market matures and that they would support behavioral health services, responsible gaming programs, and broader community investments.

Sweepstakes Platforms Face a Direct Ban

The bill does not just regulate online casino gaming. It also targets sweepstakes casino platforms and defines what it intends to prohibit with considerable precision.

A dual-currency gaming product, under the bill’s definition, is any game, promotional scheme, or platform that uses two or more forms of currency, credits, tokens, entries, points, or similar units, where at least one can be redeemed for cash, cash equivalents, or prize equivalents. That definition covers the core mechanic that most sweepstakes casino platforms rely on.

Regulators would be able to issue cease-and-desist orders against unlicensed businesses running such products in D.C. Civil penalties could reach $100,000 per violation. Repeated breaches could bring fines of up to $500,000. The District’s Attorney General would also have the power to pursue restitution and disgorgement actions against offending operators.

D.C. would join a growing list of US jurisdictions moving against sweepstakes casinos in 2026. Indiana signed a full ban into law earlier this year, and Tennessee and Oklahoma have both advanced similar measures through their legislatures.

The Road Ahead

Even if the D.C. Council passes the bill, it does not automatically become law. Under the Home Rule Act, the measure must survive a 60-day congressional review period. If Congress does not act to block it, regulators would then have 90 days to prepare the necessary rules. The bill targets a full market launch within 180 days of enactment, though that timeline depends on regulatory readiness.

The proposal follows D.C.’s broader shift toward competitive gaming markets. The District moved to an open online sports betting model in 2024, ending FanDuel’s exclusive position after it took over from GambetDC, the earlier platform powered by Intralot. DC now has six licensed online sports betting operators.

Felder made clear that inaction carries a cost. Without a legal framework, he argued, revenue continues to flow to unregulated operators, consumers remain exposed, and the District falls behind neighboring jurisdictions that are already moving forward. The D.C. online casino bill puts that argument into legislative form. Whether it survives the committee, the full council, and congressional scrutiny is the next question.