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Vermont Sports Betting Bill Advances Through Senate Committees

Written By Matthew Kredell | Updated:
Vermont sports betting bill heads to Senate floor

Senate committees changed Vermont sports betting legislation with increased revenue set aside for gambling addiction and an altered fee structure.

The Senate Finance Committee passed HB 127 by a 5-1-1 vote Tuesday.

The bill already went through the Senate Economic Development Committee. It has one more stop in Senate Appropriations before reaching the Senate floor.

Senate passage won’t be the final legislative stop for the bill. Because the Senate made changes, the bill must return to the House for concurrence.

“I don’t see any significant barriers,” bill author Rep. Matt Birong told PlayUSA.

Details of Vermont sports betting bill

The Vermont sports betting bill limits online wagering to between two and six online sports betting operators. The legislation tasks the Vermont Department of Liquor and Lottery to choose operators through an RFP (request for proposals) process.

Wendy Knight, commissioner of the department, said it wanted more than one operator to ensure competition. But the department’s research showed the second-least populous state in the country couldn’t handle more than six operators.

While the Department of Liquor and Lottery will negotiate with sportsbook operators, the bill requires operators to share a minimum of 20% of Vermont sports betting revenue with the state.

The bill also prohibits gambling on in-state college teams, except in tournaments such as March Madness. Vermont sports bettors must be at least 21 years old.

Senate committee changes to Vermont sports betting bill

As passed by the House, operators would have split an annual fee of $550,000 with two operators and an additional $50,000 for each operator. Knight feared that might not be enough money to cover regulating all operators.

In Economic Development, she proposed an amendment increasing that annual fee to nearly $2 million with six operators. But operators pushed back, saying that was too high and could limit applicants.

Jon Mandel of the Sports Betting Alliance explained that similar smaller states surrounding Vermont, Connecticut and Maine, pay a much lower fee. Adjusted for population, he claimed that even New York’s $25 million over 10 years equates to a lower fee.

“Taking that into account, these fees are significantly higher than anywhere else in the country. … We’re looking at a minimum of a 20% bid in addition to these licensing fees. So what we could see, likely, is reduced interest among operators to apply and thus a less robust, competitive market.”

After much debate, the Senate Finance Committee set the fee at $550,000 per operator over a multiyear period. This is at least three years, but could be extended during RFP negotiations.

“We’re trying to give the commissioner something to bargain with, but we wanted to make sure we were getting enough in to cover the cost,” committee chair Sen. Ann Cummings said. “We tried to leave the length of the term of the contract open because that’s bargainable.”

An amendment in Economic Development earmarked 5% of tax revenue to establish and administer a problem gambling program within the Department of Mental Health.

Sen. Kesha Ram Hinsdale, chair of the Economic Development Committee, stressed the importance of this addition.

“You’re not just voting to raise money but to focus on raising revenue for the first time for gambling addiction and mental health around gambling.”

Commissioner discusses concerns about advertising

Cummings asked Knight to explain the advertising restrictions for Vermont sports betting.

Knight said advertising rules would be part of the RFP process and written into the contract with each operator.

Each applicant must submit an advertising plan explaining its strategy not to advertise to those under age 21. The advertising plan will be part of the selection criteria.

The final contract will include some parameters from the bill such as that operators can’t use the term “risk-free bets.”

Knight said the department would also include limits around promotional credits in the contract.

Time frame for Vermont sports betting launch

Vermont appears on the way to joining Kentucky as the second state to legalize sports betting this year. Birong expressed confidence that his bill would become law and indicated that he expects the House to concur with Senate changes.

Gov. Phil Scott supported sports betting legalization by including revenue from the activity in his 2024 executive budget.

Birong said Vermont legislators plan to work until May 12. Knight urged lawmakers to act quickly and give the department time to work.

Knight set a mid-November goal of getting online sports betting up and running in Vermont.

“In all frankness, time is of the essence because we’re really trying to have the bill pass and stand up sports betting by the end of the year so that we can take advantage of the Super Bowl and March Madness. If we can get it stood up in mid-November to take advantage of the bowl season and the playoff season, every week we wait, every month it’s delayed, we’re losing the revenue that’s going to help us.”

Photo by PlayUSA
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Written 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 after federal passage of the Unlawful Internet Gambling Enforcement Act disrupted his hobby of playing small-stakes online poker. He has since interviewed more than 300 lawmakers around the country and written extensively about online gambling legislation. He has led coverage of bills to legalize online gambling in most states. A lifelong Angeleno and USC journalism alum, Matthew started his career working as a sportswriter for a decade at the Los Angeles Daily News. He has written on a variety of topics for Playboy Magazine, Men’s Journal, Los Angeles magazine, LA Weekly and ESPN.com.

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