North Carolina sports betting legislation finally crossed the finish line Wednesday.
The House voted 68-45 to concur with Senate changes to HB 347 on third reading. That ended a three-year saga that included legislation shockingly failing by one vote on the House floor last year.
Bill author Rep. Jason Saine told PlayUSA:
“This has been a very intentional process spanning two sessions to get this bill right and passed. I think the strong bipartisan vote when it left the House initially really helped my Senate counterparts make the case for the bill there. Sens. [Jim] Perry and [Tim] Moffitt did a great job on the Senate side and worked to get horse wagering included.”
The bill authorizes up to 14 mobile apps and eight sportsbooks in or around professional sports facilities. It also authorizes parimutuel horse betting.
North Carolina joins Kentucky and Vermont as states to pass sports betting authorization legislation this year.
Saine said Gov. Roy Cooper should receive the bill Thursday. He anticipates the governor will sign it at his next opportunity. Cooper has up to 12 days to sign the bill once it reaches his desk.
North Carolina sports betting should launch in the first half of 2024.
Details of North Carolina sports betting bill
Here are the main details of HB 347:
- Appoints the North Carolina Lottery Commission (NCLC) to oversee sports betting licensing and regulations.
- Allows for up to 14 online sportsbook operators. This includes two tribal online sportsbook partners.
- Online sports betting licenses cost $1 million every five years.
- Levies an 18% tax on gross gaming wagers with no deductions for promotional credits.
- Guarantees interactive sports betting licenses to two federally recognized North Carolina Indian tribes — the Eastern Band of Cherokee Indians and Catawba Indian Nation. These tribal licenses don’t count toward the cap of 12 awarded by the commission.
- Operators not partnered with tribes must use geofencing to ensure that people are not located on Indian lands when placing a wager.
- Service providers pay $50,000 for a five-year license and suppliers pay $30,000.
- Advance deposit wagering licensees pay an initial $1 million application fee.
- Advanced deposit wagering licensees pay an annual 1% tax on total parimutuel wagers.
Saine credited his co-sponsors — Reps. John Bell, Ashton Clemmons and Zack Hawkins — with putting the bill together.
“Getting the bill to the point of passage has been a collaborative effort, and I’m very proud of the work with my co-sponsors,” Saine said. “It was very much a team effort.”
Sports facility participation in NC sports betting
Online sports wagering licensees are encouraged to partner with sports teams and entities to offer in-person sportsbooks at or adjacent to professional sports venues. The bill calls these sportsbooks public places of accommodation.
The teams or sporting venues themselves won’t require licenses. But these partnerships will be considered during the application process for sports betting operators.
Here are the eight sporting venues that could have retail sportsbooks:
- Bank of America Stadium (Carolina Panthers and Charlotte FC)
- Spectrum Center (Charlotte Hornets)
- PNC Arena (Carolina Hurricanes)
- Charlotte Motor Speedway (NASCAR)
- North Wilkesboro Speedway (NASCAR)
- Quail Hollow Club (PGA Tour)
- Sedgefield Country Club (PGA Tour)
- Sahlen’s Stadium at WakeMed Soccer Park (North Carolina FC and North Carolina Courage)
Three-year journey to passage for NC sports betting
In 2019, North Carolina authorized in-person sports betting at the tribal casinos in the state.
Saine and Sen. Jim Perry followed up in 2021 with legislation to legalize statewide online sports betting.
The Senate first passed North Carolina sports betting legislation by a 26-19 vote at the end of the 2021 session. The House did not take up the bill then, but the legislation carried over to the second year of the two-year legislative term.
Saine thought he had the votes to pass NC sports betting in 2022. But opponents took over the House floor and the bill lost by a single vote.
Senate changes, including authorization of parimutuel wagering and increasing the sports wagering tax rate, sent the bill back to the House for approval.
Opponents have their say on House floor
Not everyone was happy with the passage of North Carolina sports betting.
Four members of the House of Representatives spoke out against the bill Wednesday, knowing the House was about to concur.
They were familiar faces who had derailed the bill last year and spoke out against it before initial House passage.
“This predatory gambling bill is still predatory and is going to hurt North Carolina, and it doesn’t look like we’re going to achieve very much in exchange,” Rep. Pricey Harrison said on the floor.
Harrison did appreciate Senate changes to remove tax deductions on promotions and increase the tax rate. But she did not like the addition of horse betting.
“A lot of us are particularly bothered by the addition of horse racing. … Churchill Downs shut down because of 12 deaths in the last five weeks, seven of which occurred the week before the Kentucky Derby. This is an inhumane, terrible industry. Nine hundred thoroughbreds who were involved in racing died in 2022.”
Rep. Abe Jones said that the only entity that will gain from this bill is the gambling industry.
This hurts families. It doesn’t help families. I’m a family man, believe in my family, love my family. I’m sure all of you do. But there are people out there who are weak, who will go gamble and won’t protect their family. We should protect those families for them.
Rep. John Autry, who launched derailment of the bill last year by adding an amendment to remove betting on college sports, expressed frustration in a Senate change involving college sports. The Senate removed a House prohibition on betting at sports facilities during or within eight hours of a college game being played.
Rep. Marcia Morey said she felt the legislature was harming the integrity of sports by passing the bill.
“By putting gambling in, people will now be more interested in the spread than they are in the victory or defeat,” Morey said. “I think that it’s a sad day for athletes and a sad day for people who will become addicted.”
NC sports betting financial projections and distributions
A fiscal note produced by the NC General Assembly’s Financial Research Division projects state tax revenue for North Carolina sports betting to reach $100 million annually at market maturity.
Here’s how the bill directs that revenue:
- Up to $300,000 each for athletic departments of 13 small colleges and universities.
- $2 million to the Department of Health and Human Services for gambling addiction education and treatment programs.
- $1 million to the North Carolina Amateur Sports to expand opportunities in youth sports.
- $1 million to the North Carolina Outdoor Heritage Advisory Council.
- Up to $500,000 to reimburse the North Carolina Lottery Commission for administrative expenses related to sports wagering.
- 50% of remaining funds to the state general fund.
- 30% of remaining funds to the North Carolina Major Events, Games and Attractions Fund.
- 20% of remaining funds split evenly between athletic departments of 13 NC Historically Black Colleges and Universities.
More North Carolinians will soon place bets in NC
North Carolina already has legal sports betting at three tribal casinos:
- Harrah’s Cherokee Casino Resort in Cherokee
- Harrah’s Cherokee Valley River in Murphy
- Catawba Two Kings Casino Resort in Kings Mountain
But North Carolinians in population centers were more likely to attempt wagers on legal sports betting apps in neighboring Tennessee or Virginia.
GeoComply provided data that nearly 155,000 sports wagering accounts in North Carolina attempted to place bets more than 1.5 million times in 2023.
GeoComply SVP John Pappas, who testified in front of a North Carolina House committee earlier this year, congratulated lawmakers on responding to their constituents’ demand for legal sports betting.
“While our technology did not permit these individuals to bet, the interest is undeniable. It is also undisputed that regulation will give adult bettors in North Carolina safe and accountable options to wager and the state an important new revenue stream.”
When North Carolina sports betting could launch
Lawmakers set the earliest possible launch date as Jan. 8. In prior bill language, that was the expected launch date.
However, the North Carolina Lottery Commission asked the legislature for leeway to choose the date after assessing the work needed. The legislature gave the commission a deadline of one year after the act becomes law, stressing launch should occur “as soon as practicable.”
The governor’s signature triggers the act to become law. Cooper has 12 days to sign the bill once it reaches his desk. That puts the window for North Carolina online sports betting launch between Jan. 8 and June 2024.