The North Carolina House revved up sports betting legislation Thursday but is not ready to take it to the finish line.
The House Commerce Committee voted 12-4 to advance Senate Bill 688. It next goes to the House Judiciary Committee.
However, Rep. Jason Saine tells PlayTenn that a House vote isn’t likely until next June.
“If I had the opportunity to get this done, I’d go ahead and do it. It’s just because we’re up against so many obstacles, and we have a number of legislative conferences in December and we’re gearing up for the holidays. More likely than not, this goes into our short session in the spring.”
The North Carolina Senate passed the sports wagering bill by a narrow margin on Aug. 18.
Details of North Carolina sports betting bill
The language discussed Thursday was the same language that passed the Senate. Saine said the authors modeled the legislation after the sports betting bill passed in Virginia.
Key details include:
- Appoints the North Carolina Education Lottery (NCEL) to oversee sports betting.
- Instructs the NCEL to issue between 10 and 12 mobile sports betting licenses.
- The two federally recognized North Carolina Indian tribes are guaranteed licenses. The Eastern Band of Cherokee Indians already offers retail sports betting at two casinos.
- Allows the owner/operator of sports facilities that host professional sports games with a capacity of 17,000 or more to place sports betting lounges at or within a quarter mile of the facility. Sports betting lounges are different from sportsbooks in that they don’t accept cash bets.
- Initial fee of $500,000 for a five-year license, renewable for $100,000.
- Service provider license for $25,000, renewable for $10,000.
- Tax rate of 8% on adjusted gross sports betting revenue, minus promotional spend.
- Allows wagering on college sports.
- Mandates operators use official league data for in-play wagers.
Sen. Jim Perry, sponsor of SB 688, briefly addressed the committee. He said the tax rate could increase before the bill passes.
“I do anticipate, if the bill continues to move, that the tax rate will change and there will be some bumpers around what we define as net revenue,” Perry said.
Religious groups voice opposition again
Just like at a Senate committee earlier this year, religious leaders spoke out against the legislation.
Saine had compared betting on sports to playing the stock market.
“A certain amount of skill and knowledge is required to place bets,” Saine said. “With the lottery, you’re flipping a coin. With sports betting, you’re using knowledge and education to get an edge, similar to buying and selling stocks.”
Reverend Mark Creech of the Christian Action League of North Carolina railed against this comparison. He contended that stock market losses stay in the overall marketplace, while gambling losses go to the house.
“What this is about is financial fraud being perpetuated on North Carolinians, and you should see it as such and protect their interests by defeating this measure,” Creech said.
John Rustin of the North Carolina Family Policy Council argued that as more forms of gambling are legalized and advertised, more citizens will gamble. And that between 3% and 5% of gamblers will develop a problem gambling issue.
He described the legislation in a doomsday way that will make North Carolina representatives think twice about supporting the bill:
“As members of the North Carolina House, I would like to ask each of you how you would respond if you were presented with a bill that you knew would lead to an increase in domestic violence, child abuse, divorce, substance abuse, theft, embezzlement, job loss, personal bankruptcy and even suicide. Unfortunately, this will be the result if this bill before you is enacted into law.”
Amoral argument resonates with some NC lawmakers
With North Carolina being a Bible Belt state, the Christian Action League and Family Policy Council hold a lot of influence.
Rep. Jay Adams told the story of his father, who learned to gamble while being held in a German prison camp for 16 months during World War II.
“He came away with some incredible gambling skills. So I grew up with a father who played cards, shot craps, he was an all-around gambler. He was well known for being invited to leave casinos in Las Vegas and he was kidded about it by all his friends. But growing up around a father who gambled all the time, he had friends who gambled. And his friends weren’t always as good as him. In fact, a lot of them weren’t. And I saw families destroyed by gambling. When I was a young man and I worked with my father, I saw businessmen in suits get in fist fights over a craps table. That’s my experience with gambling.”
Rep. Deb Butler also spoke against the bill. She didn’t agree with Saine’s point that legalization wasn’t an expansion of gambling because sports betting already takes place in North Carolina.
“However you characterize this, it is a wild expansion of gambling in North Carolina. The suggestion that it’s happening and we shouldn’t put the blinders on, to me that argument isn’t particularly helpful. This is an expansion of gambling. And I think that it is clear to many that it is going to affect those that can arguably least afford it the most.”
Rep. Frank Iler said he would advance the bill but would not promise to support it on the floor. He added that when he’s back home he will poll people and see where the church-goers and older folks stand on the issue.
NC professional sports support sports betting bill
Rustin also alleged that legalizing sports betting would degrade North Carolina’s rich history in sports.
Ches McDowell, speaking on behalf of the NBA, Major League Baseball, PGA Tour and Charlotte Hornets, disputed that statement.
“This bill solves a sports integrity problem. It does not create a sports integrity problem. Right now in North Carolina, someone can place a bet offshore. We don’t know that bet happens. They’ve caught multiple fraud schemes around the country by legal and regulated sports betting. When you know who places the bets, what bets are being placed, you’re able to track it and see what’s unusual. When it’s a wild west free-for-all offshore market, we don’t know. So for sports integrity, this is a bill that’s absolutely needed.”
Under the bill, the Hornets, Carolina Hurricanes, Carolina Panthers and Charlotte Motor Speedway can get sports betting lounges outside their facilities.
Can NC sports betting bill reach the finish line?
This has been a strange year in the North Carolina legislature. Usually, lawmakers are home by July. But they have stayed in Raleigh to complete a long-overdue budget and work on redistricting.
Saine serves as senior budget writer in the House and was on the redistricting committee. So once the Senate sent the bill over, he didn’t have any time to work on sports betting.
Saine said he would like to hit the ground running on sports betting legislation when the legislature returns in 2022. It’s not lost on him that a quick passage in the spring could help regulators prepare to get sports betting launched for the NFL season.
He said it’s possible that the Judiciary Committee could hear the bill the week of Nov. 15. That would have the bill ready for the floor when lawmakers return.
Legislation carries over to the second year of the two-year session. So legislation continues where it left off in 2021.
Lawmakers only meet for short sessions in the second year. The session commences May 18, with a scheduled adjournment date of June 30. Only finance and appropriation bills come up in a short session, but Saine said sports betting absolutely qualifies.
Thursday’s hearing made Saine more confident that sports wagering can pass in North Carolina next year.
“I think the vote today shows the bill has really good bipartisan support,” Saine said. “That’s a good indicator on moving the bill. As much as anything, I wanted to indicate that the bill has life and will continue to move.”