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Georgia Sports Betting Fails To Pass On Final Day Of Legislative Session

Georgia sports betting efforts died Thursday when Republicans wouldn’t agree to Democrat demands over putting revenue toward needs-based education funding.

Georgia State Building
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Matthew Kredell Avatar
7 mins read

Georgia sports betting efforts died Thursday when Republicans wouldn’t agree to Democrats’ demands to put revenue toward needs-based education funding.

In the House Higher Education Committee, Rep. Sam Park proposed an amendment to earmark 70% of Georgia sports betting revenue to needs-based scholarships.

But the committee did not include Park’s amendment before advancing SB386 and constitutional amendment SR579 on to the House Rules Committee. Park told PlayUSA he would try to negotiate a Rules substitute that included part of his proposal.

Georgia sports betting legislation never got the support to make it out of Rules. The legislature adjourned around 1 a.m. Friday.

“I’m disappointed we didn’t get a floor vote,” House sponsor Rep. Marcus Wiedower told PlayUSA as the House adjourned. “This will be a measure that will be taken up again next year. I think we should bring online sports betting into the legal market, regulate it and keep tax dollars here in Georgia.”

Georgia sports betting legislation was able to pass through the Higher Education Committee without support from Democrats because committee advancement only requires majority support. But as a constitutional amendment, final passage of SR 579 on the floor necessitates a two-thirds vote. That’s 120 of the 180-member Georgia House of Representatives.

There are only 101 Republicans in the House, and not all of them support sports betting. So passage of Georgia sports betting with a constitutional amendment requires bipartisan support. As House minority whip, Park holds the reins on 78 Democratic votes, giving Democrats leverage to push for priorities in the legislation.

Asked Wednesday by PlayUSA whether the sports betting legislation will come down to the willingness of Republicans to accept needs-based education funding, Republican Rep. Ron Stephens responded:

“That seems to be the posture and the count on our side is not good.”

Why Georgia needs-based educational funding is a partisan issue

When Georgia created the lottery in 1991 and 1992, it also created the HOPE Scholarship to encourage top students to stay in the state for college.

While HOPE turned into the largest state-funded merit-based scholarship program in the country, it did originally include a small needs-based component.

It paid for two-year scholarships for students with a “B” average and a family income of less than $66,000 a year. Later legislators eliminated the income requirement. And, in 2011, the state created a second merit-based Zell Miller scholarship.

The HOPE Scholarship sparked a national debate on needs-based and merit-based scholarships. Many Georgia Democrats believe people of color are underserved by both state-funded scholarships, which reports show are more likely to go to students from higher-income families.

Proposed amendment to gain minority party support

Park wanted to address those issues with an amendment to change the distribution of Georgia sports betting tax revenue, projected to be about $100 million.

Here’s where he wanted to put the revenue:

  • 35% to higher education for citizens whose household income is below the median household income for Georgians.
  • 35% to higher education for students from rural Georgian counties with a population below the state average.
  • 25% to voluntary Pre-K.
  • 5% to address gaming addiction.

As proposed by Wiedower Georgia sports betting revenue went to the same educational fund as other Georgia lottery revenue supporting merit-based scholarships and Pre-K funding.

Park explained his amendment:

“It would help direct funds in a more clear and specific manner to I think some of the high needs of this state, both with respect to Pre-K as well as with higher education. So I hope that as this issue proceeds, there would be an opportunity again for this issue to garner bipartisan support. As a bipartisan compromise will be needed on both the House and Senate floor.”

Wiedower later responded:

“As far as bipartisanship goes, I don’t know how I can be more bipartisan in this right now. I have had an open-door policy. I have gone to bat for everybody on this committee. My door is still open and will be for the foreseeable future. When we start dividing the money, I mentioned it the other day. I mean, how many different places do you want to take it? How many pet projects do you want me to entertain? One thing we all seem to agree upon is education and making sure there is good education for our children, and that’s where I have tried to keep this money.”

Georgians attempting March Madness bets in North Carolina

North Carolina and other surrounding states are the victors coming out of Georgia’s failure to pass sports betting legislation once again.

Unless the Georgia legislature changes course and decides sports betting can be done under the lottery without a constitutional amendment, it will be another two years before Georgia voters can decide on sports betting.

North Carolina launched online sports betting earlier this month, just in time for the NCAA College Basketball Tournament.

The Sports Betting Alliance shared GeoComply data showing that since the March 11 launch, it has identified more than 32,000 sports wagering accounts making 258,000 geolocation checks in Georgia.

Those Georgians could not place wagers unless they drove across the border into North Carolina or another neighboring state where sports betting is legal.

Georgia sports betting details

Although the bills were in flux with the proposed amendments, the main details included:

  • A potential 16 sports betting apps.
  • Limits sports betting to online only.
  • Eight licenses are tethered to the following Georgia professional sports entities: Atlanta Falcons, Atlanta Braves, Atlanta Hawks, Atlanta Dream (WNBA), Atlanta United FC, Augusta National, PGA Tour and NASCAR.
  • Seven standalone licenses for online sports betting operators.
  • One license for the Georgia Lottery Corp.
  • A $100,000 initial application fee and an annual license fee of $1 million.
  • 25% tax rate.
  • Doesn’t allow deductions for promotional credits.
  • Prohibits the use of credit cards to fund online sports betting accounts.

Amendments added in Higher Education Committee

Georgia’s failure to pass sports betting legislation means the state will continue forward with a lack of problem gambling funding.

Republican sponsors added several amendments in House Higher Education before advancing the bills Thursday. The amendments had all been discussed in the committee this week.

Wiedower’s primary amendment increased the tax rate from 20% to 25% and took away the priority for Pre-K funding as passed in the Senate.

Sen. Bill Cowsert amendment sends 15% of the first $150 million tax revenue collected each year to go to problem gambling.

Georgia doesn’t currently have dedicated funding for problem gambling. Cowsert’s amendment creates the potential for Georgia sports betting to contribute as much as $22.5 million a year to address problem gambling, which would be the most by any state in the nation.

Cowsert proposed that 15% of the first $150 million collected in sports betting revenue each year go to problem gambling.

“My belief is people are gambling in Georgia are gambling already, on sports for sure. I bet you a lot of people in this room got something riding on the March Madness. And they’re gambling on lottery. And the lottery corporation is spending about $400,000 a year on it, and I don’t think that scratches the surface. This now gives them a fund and a funding mechanism to do some real intervention, prevention and education meaningfully, and keep that money separate so that’s all it can be spent for.”

Wiedower also made an amendment to SB 386 to include responsible gaming guidelines suggested last year by the National Council of Legislators from Gaming States.

“I’m hopeful that it comes to the floor to let the voters decide in November,” Wiedower told PlayUSA following the Higher Education Committee passage.

Georgia legislature passes COAM bill

Cowsert said dedicated funding to address problem gambling was more important than ever after the legislature approved a bill to reform the state’s coin-operated amusement machines (COAM) industry.

The Senate amended and passed HB353 by a single vote Tuesday. Later in the day, the House concurred with the changes, sending the bill to the desk of Gov. Brian Kemp.

Georgia legalized COAMs in 2013. The Class B games located at convenience stores around the state play like slot machines but can’t offer a cash payout.

Previously, COAM winnings came as in-store credit at the convenience store where the game was played. The new legislative changes make them more enticing by putting the winnings on gift cards that can be used all around the state.

The bill also increases the tax rate paid to the state from 10% to 13% of COAM revenue. The games previously produced about $140 million in annual revenue for the lottery. The tax increase should put an additional $40 million annually toward HOPE scholarships and Pre-K.

Cowsert said at Wednesday’s hearing that he fought against the COAM bill. But after it passed, he thought it was more important to pass the sports betting bill with significant problem gambling funding.

“You can call them what you want to call them, we’re about to have slot machines all over the state. The House has already approved it and I couldn’t beat it in the Senate. So you’re going to have more problem gaming. There’s going to be those people there sitting playing those slot machines, there’s going to be people buying lottery tickets and probably betting, whether legally or illegally. And this funding would help us treat it one way or another.”

Matthew Kredell Avatar
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Matthew Kredell serves as senior lead writer of legislative affairs involving online gambling at PlayUSA. He began covering efforts to legalize and regulate online gambling in 2007 and has interviewed more than 300 state lawmakers around the country.

View all posts by Matthew Kredell

Matthew Kredell serves as senior lead writer of legislative affairs involving online gambling at PlayUSA. He began covering efforts to legalize and regulate online gambling in 2007 and has interviewed more than 300 state lawmakers around the country.

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