Correction: A previous version of this story incorrectly stated that the TPC Scottsdale site would have to be rezoned to allow for the sports betting use. The story has been updated to reflect that the city must only update the zoning code to allow for the new use. A rezoning is not required.
Gambling could be on the horizon at Scottsdale’s most famous golf course if new sports betting legislation passes muster with Arizona Governor Doug Ducey.
This morning, the PGA Tour and DraftKings announced plans to open a retail sportsbook at the TPC Scottsdale golf club that plays host to the Waste Management Phoenix Open, the tour’s most-attended annual golf tournament.
The PGA Tour’s partnership with DraftKings would allow the online fantasy sports platform to offer retail sports betting and and mobile betting in Arizona if the new bill is signed into law.
The announcement comes days after the Arizona House and Senate passed House Bill 2772, which would give 10 professional sports operators and 10 tribes the opportunity to acquire a sports betting license.
Under the bill, Scottsdale’s TPC course qualifies as a potential sportsbook site under a stipulation allowing an “operator of a sports facility that hosts an annual tournament on the PGA tour” to apply for a license.
“So that would immediately kind of define it as TPC Scottsdale,” said Norb Gambuzza, the PGA Tour’s senior vice President of media and gaming.
The PGA Tour and DraftKings described the proposed sportsbook as a “19th hole” fans can visit throughout the year to eat, drink, place wagers and watch sports.
“We have this vision of this premium, world-class, luxurious, beautiful environment with great food and music and atmosphere,” Gambuzza said.
Under the proposal, the PGA Tour and DraftKings will be responsible for all costs to build the new facility.
If all goes according to plan, Gambuzza said the group plans to have the facility open in time for the next Super Bowl in Arizona in 2023.
Before any of that can happen, the City of Scottsdale will need to update the zoning code to allow for the new sports betting use, said attorney Jordan Rose, who is working on the project.
“We're going to partner with the city to tweak the zoning code to add the sportsbook use,” Rose said.
“But note that it can only be located physically by state law at the TPC (Scottsdale) or wherever the Phoenix Open is placed…” she said.
She said that means there is not another site in Scottsdale city limits that would qualify to host a sportsbook under the proposed legislation.
The closest sportsbook would be located on the nearby Salt River Pima-Maricopa Indian Community, which operates the Talking Stick Resort and Casino east of the Scottsdale border near Loop 101 and Via de Ventura.
The city and federal government would also have to approve amendments to the PGA Tour’s existing lease for the TPC property to account for the new use.
The Tournament Players Club Scottsdale was built in the 1980s on a mixture of lands owned by the U.S. Bureau of Reclamation and City of Scottsdale.
The city, which uses the federal portion of the property through a Recreational Land Use Agreement, signed a 50-year lease with the PGA Tour in 1984 and built the golf complex as part of the agreement.
Under the current version of the lease, the city is entitled to 12.5 percent of all golf-related revenue on site and two percent of all food, beverage and pro shop sales.
Thomas Galvin, an attorney with Rose Law Group, said the lease would be amended to give the city a two percent cut of all sportsbook revenues as well.
In addition to increased lease revenues, the PGA Tour and DraftKings are arguing the proposed sportsbook would be a financial windfall for the city in other ways.
The group commissioned an economic and fiscal impact report from economist Elliot Pollack that found the sportsbook would contribute $2.8 million in annual tax revenue to the city, county and state, including $724,200 in annual tax revenue to the City of Scottsdale.
Gambuzza said the sportsbook facility would also boost the popularity of the Waste Management Phoenix Open - which already draws hundreds of thousands of fans in a typical year - further bolstering Scottsdale’s tourism economy.
“We're looking at this opportunity to create something that really doesn't exist anywhere,” Gambuzza said. “There really are no comps for this kind of a world-class sports and entertainment, sportsbook kind of venue, premium restaurant, at a world-class golf facility anywhere.”
The group is also working with the Phoenix Thunderbirds, the non-profit that hosts the Phoenix Open, to see how that cache could help the organization’s fundraising efforts.
“The Waste Management Phoenix Open has always been a fan-first event and this new partnership only enhances the already incredible experience at ‘The People’s Open,” said Michael Golding, the chairman of the 2022 Phoenix Open.
“The real winners in this are the hundreds of Arizona charities who will benefit from proceeds raised from this partnership.”
Gambuzza said the PGA Tour did not begin pursuing the sportsbook project in earnest until midway through last summer.
“At the beginning of 2020 this was really not even on our radar and as the spring and summer kind of wore on, it became apparent that the legislation was being discussed in a way that could involve us,” he said.
At that point, the PGA Tour began vetting potential partners and ultimately signed a 10-year deal with DraftKings, which has already agreed to two other fantasy sports-related partnerships with the PGA in recent years.
“When DraftKings became the first Official Betting Operator of the PGA TOUR last summer, a number of possibilities opened up to innovate together,” DraftKings Chief Business Officer Ezra Kucharz said in a press release.
“This momentous effort to pursue a first‐of‐its‐kind sportsbook with the PGA Tour is a testament to the vision of both organizations that we believe will ultimately benefit Arizona sports fans who want to legally bet on sports.”
The group is still in the process of identifying the exact location where it will build the sportsbook if and when Ducey signs the sports betting bill into law.
“And as soon as that happens, our number one priority is going to be focusing on TPC Scottsdale, identifying the specific location for where we want to build it, engaging architects, and really building something truly unique and fantastic that that will be a huge draw for the City of Scottsdale and for everybody involved,” Gambuzza said.