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NC sports wagering bill advances through first House committee

North Carolina lawmakers debated the legalization of widespread sports wagering in Tuesday's House Commerce Committee meeting.

Posted Updated

By
Brian Murphy
, WRAL sports reporter

A bill to legalize mobile sports wagering in North Carolina cleared the House Commerce Committee on Tuesday, the first step this year in allowing betting on sports from cellphones and other electronic devices.

House Bill 347 is scheduled to be heard in the Finance and House Judiciary 1 committees on Wednesday. A vote in the House could happen as soon as next week.

Similar legislation failed by a single vote in the House in 2022, but supporters are optimistic about its chances this year.

"You might have heard a little bit about it. It's been widely publicized," said Rep. Jason Saine, a Lincoln County Republican, and the bill's leading proponent.

Said Rep. Zack Hawkins, a Durham Democrat and another primary sponsor: "We know that some of your believe that gambling is a vice. But much like we allow for taxes on alcohol and cigarettes, we can use this revenue from the activity, that is widely happening in our state, for good."

Two amendments aimed at changing the bill failed in the Commerce Committee. One would have prohibited credit cards from being used to fund accounts and make bets. The other would have allowed betting on professional sports, but not any other games, including college.

"It is a fiction to suggest that the amount of gambling in this state or anywhere else is fixed, and that we're just shifting it from the illegitimate offshore place that it's currently located to a regulated and controlled place," said Deb Butler, a New Hanover Democrat, who voted against the bill.

"We know that gambling is going to exponentially increase in North Carolina if we go down this path."

Butler pointed to New Jersey where the amount wagered more than doubled between 2019 and 2022. Operators in New Jersey took more than $11 billion in sports bets in 2022. In 2019, that figure was $4.5 billion.

"Why do we want to facilitate something that we know has the capacity to destroy that many people's families?" Butler said. "When you've got these unrelenting ads, and it's constant. We know that young impressionable people are going to be particularly vulnerable."

Of the 26 members on the committee, 15 are sponsors of the bill. There are 55 sponsors in the 120-member House, including Rep. Robert Reives, a Chatham County Democrat, who voted no on similar legislation last year.

The bill has support and opposition from Republicans and Democrats.

Gov. Roy Cooper, a supporter of legalization, included $85 million from sports wagering tax revenue in his recently released two-year budget.

"A lot of people this time are not taking anything for granted," Cooper said last week. "I think as a lot of lobbying occurred early, people got positive responses from legislators, and they didn't do the things they needed to do to close. I think this time nobody is taking anything for granted."

Under the bill, as currently written. mobile sports wagering could begin in North Carolina on Jan. 1. The bill allows for 10 to 12 operators to secure $1 million licenses to accept mobile bets in the state. Operators would be charged a 14% privilege tax on gross revenue. They would be able to write-off costs associated with acquiring new customers, such as free or promotional bets, for up to three years.

Tax revenue would be allocated to various interests in the state, including the athletic departments at seven UNC System public colleges. Hawkins said supporters will amend the bill to add UNC-Wilmington, UNC-Greensboro and Western Carolina to the athletic departments that receive funding.

The athletic departments would receive $300,000 annually and then 10% of the revenue left after other monies are distributed.

The only athletic departments that would not receive tax revenue from sports gambling are those that sponsor football at the highest level: App State, Charlotte, East Carolina, NC State and UNC-Chapel Hill.

"Is that dangling money in front of them to get their favorable vote," Rep. Marcia Morey, a Durham Democrat, told WRAL before the vote. "I hate to think so, but it kind of appears that way."

Morey swam for the United States in the 1976 Olympics. She later was the first female investigator for the NCAA and investigated recruiting violations among big-time college football programs.

"We're turning athletic competition and the purity of it into gambling." said Morey, who is not a member of the commerce committee. "And as a former athlete, I just think that's horrible. Anytime you're not looking at the sport, you're looking at the odds and the bets, it totally changes the nature of everything."

During last year's House votes, opponents of mobile sports betting were able to strip wagering on college sports from the legislation. Rep. John Autry, a Mecklenburg County Democrat, tried to do it again Tuesday.

"If we're going to do this, I don't see any reason that we should sully our beloved college sports or amateur sports in North Carolina," Autry said in committee. "I know we're all big fans of college sports. And this bill, I'm afraid, would just sully the whole wonderful thing that we enjoy in North Carolina."

Saine said removing college sports from the bill would "severely handicap the intent of the legislation" and sharply reduce the amount of revenue generated by the bill.

Rep. John Bradford, a Mecklenburg County Republican, pointed to changes in college athletics, including expansion of the college football playoff and name, image and likeness payments as reasons not to treat college athletics differently.

"We're now paying college players," Bradford said. "At the end of the day, college sports has changed before our eyes. ... College athletes are now able to make money under NIL and so, therefore, it is clear that college sports is a big business."

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