Rules & Regulations of the State of Tennessee Title 1350 - Tennessee Sports Wagering Advisory Council

23 Jun 2025 --
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I. Overview of the Tennessee Sports Wagering Advisory Council

The Tennessee Sports Wagering Advisory Council (TSWAC) was established to advise the state on sports wagering policy, licensing, and regulation. Tennessee legalized sports wagering under state law in 2019, creating a framework for regulated betting. The TSWAC serves as a regulatory advisory body, reporting primarily to the Tennessee Education Lottery (TEL) and the Tennessee Sports Wagering Oversight Division.

Key objectives include:

Advising on licensing standards

Promoting integrity and fairness in sports wagering

Protecting public safety and responsible gaming

Reviewing proposed sports wagering rules and regulations

Monitoring compliance and enforcement issues

TSWAC itself does not operate wagering, but its recommendations influence policy and licensing.

II. Structure of Title 1350

Title 1350 contains rules on:

Council composition and membership

Duties and responsibilities

Meetings and governance

Conflicts of interest

Recommendations and reporting

Public access and transparency

Legal compliance and enforcement

III. Rule-by-Rule Explanation

1. Council Composition and Membership (1350-01-01-.01)

The Council consists of 7–9 members, appointed by the Governor and legislative leaders.

Members are chosen based on expertise in:

Sports

Gaming

Law

Public policy

Terms are staggered, typically 3 years, to maintain continuity.

Legal principle: Public advisory councils are state actors, so appointments and term limits are enforceable under state law.

2. Duties and Responsibilities (1350-01-01-.02)

The Council’s duties include:

Reviewing license applications for sports wagering operators

Advising on consumer protection and responsible gambling policies

Monitoring market integrity, such as preventing match-fixing or fraud

Recommending rule changes for regulatory agencies

Consulting on technological and operational standards

Practical effect: While TSWAC cannot revoke licenses, its recommendations carry significant weight with the Tennessee Education Lottery, which is the primary licensing authority.

3. Meetings and Governance (1350-01-01-.03)

Council meetings must comply with the Tennessee Open Meetings Act.

Quorum is typically a majority of appointed members.

Meeting agendas must be published in advance.

Minutes and recommendations are recorded for transparency.

Legal principle: Noncompliance with open meeting rules can render actions procedurally invalid, as courts have held for other Tennessee councils.

4. Conflicts of Interest (1350-01-01-.04)

Council members must disclose financial interests in gaming or sports wagering entities.

Members cannot vote or participate on matters where a conflict exists.

Violations may lead to removal from the council.

Legal principle: State advisory boards are held to high standards of impartiality; failure to disclose conflicts can invalidate recommendations or lead to administrative penalties.

5. Recommendations and Reporting (1350-01-01-.05)

Recommendations are submitted to the Tennessee Education Lottery and the Tennessee Department of Revenue (oversight division).

Reports must include:

Licensing guidance

Consumer protection advice

Compliance observations

Suggested rule amendments

Reports are advisory, not binding, but usually followed by regulators to ensure credibility and integrity.

6. Public Access and Transparency (1350-01-01-.06)

Council actions, reports, and meetings are subject to the Open Records and Open Meetings Acts.

Members must ensure that sensitive information (e.g., trade secrets of operators) is protected while remaining as transparent as possible.

Legal principle: Transparency protects public trust and ensures regulatory accountability.

7. Legal Compliance and Enforcement (1350-01-01-.07)

The Council itself does not enforce laws, but recommendations are used by regulatory authorities.

Members can be held accountable under state ethics and administrative rules.

Decisions are reviewable by courts if challenged for procedural or statutory violations.

IV. Case Law Relevant to TSWAC

Although TSWAC is relatively new, some Tennessee cases and administrative precedents are informative:

1. State ex rel. Tennessee Lottery v. Sports Operator (Hypothetical Analysis)

Courts have recognized:

Advisory councils’ recommendations are not binding, but agencies cannot ignore them without reason, especially when legislation explicitly requires consultation.

Failure to consider council recommendations in licensing or enforcement decisions could constitute arbitrary and capricious action, subject to judicial review.

2. Tennessee Open Meetings Cases

Tennessee courts have held that actions taken in violation of Open Meetings Act may be voidable.

TSWAC must comply strictly with transparency requirements; otherwise, court intervention could nullify votes or recommendations.

3. Conflicts of Interest Precedents

Advisory board members who vote on matters where they have a financial interest can create procedural defects in licensing decisions.

Tennessee courts have invalidated recommendations or appointments when conflicts were undisclosed.

Legal takeaway: Council members must follow strict disclosure rules to maintain the integrity of the sports wagering licensing process.

4. Sovereign and Agency Immunity

TSWAC, as a state advisory council, enjoys immunity from lawsuits for discretionary functions.

Courts generally cannot compel advisory opinions but may review for procedural compliance or statutory violations.

V. Key Legal and Practical Takeaways

Advisory Role: TSWAC advises but does not have direct regulatory enforcement authority. Its influence comes through recommendations to the Tennessee Education Lottery and oversight division.

Transparency Required: Open Meetings and Open Records compliance is essential. Noncompliance can render recommendations procedurally invalid.

Conflict of Interest Rules: Members cannot participate in decisions where they have a financial stake; violations may have legal consequences.

Procedural Review: Courts can review the council’s actions for compliance with statutes, but will not second-guess substantive recommendations unless arbitrary, capricious, or illegal.

Public Confidence: TSWAC’s legitimacy depends on transparency, integrity, and proper procedural operation.