Saturday, December 9, 2023

Sports betting in NC one step closer to reality, UNCW could benefit from its legalization

House Bill 347 would legalize online sports betting in North Carolina. (Port City Daily/Shea Carver)

Wagering on horse racing and other sporting events might not be the exclusive property of North Carolina’s tribal lands for long.

On Thursday, the state Senate passed a key vote, 37-11, on House Bill 347, which would legalize online sports betting in North Carolina. It sets up the bipartisan legislation for a final vote in the House, likely to take place by next week according to speaker of the House Tim Moore.

If the House approves the Senate’s changes, it then goes to the desk of Gov. Roy Cooper, who told the News & Observer last month he will sign the legislation. It would go into effect January 2024.

The bill’s passage could benefit 13 statewide universities, which stand to gain millions of dollars from the legislation. 

Sports wagering in North Carolina has been permitted only on reservations since 2019 when Cooper signed Senate Bill 154 into law. 

The Senate has made changes to the original language of H.B. 347, first passing the House in March. Sen. Michael Lazzaro (R-Onslow) sponsored an amendment for the revenue allocations following a request from the North Carolina Lottery Commission to better regulate the process.

Included now is raising the tax rate to 18% from 14% on sports-betting businesses, allowing in-person cash betting at certain sports venues across the state and eliminating deductions for promotional credits.

No more than 12 licensed operators will be able to take bets in North Carolina, according to the legislation. A gaming license would cost $1 million for a five-year period. 

Eight facilities are able to operate a sports book under the current bill: PNC Arena in Raleigh, Bank of America Stadium and Spectrum Center in Charlotte, Charlotte Motor Speedway, WakeMed Soccer Park in Cary, North Wilkesboro Speedway, Sedgefield Country Club and Quail Hollow Country Club, each housing PGA tour courses.

Each venue would be allowed to partner with mobile operators, such as Verizon or AT&T, who have 5G connections that allow Internet betting options. 

The remaining four licenses would be open to in-state or out-of-state gambling business operators.

The bill also proposes allocating funds to universities, school grant programs and gambling education resources from the license fees and taxes of the new businesses.

Around $1 million will go to the North Carolina Outdoor Heritage Advisory Council — an initiative funded by the state to promote outdoor experiences and programs for youth. That money will be put toward grants to assist with travel for local youth sports teams or to attract events to the state.

Annually, $2 million would go to the Department of Health and Human Services for gambling addiction and treatment programs.

Locally, UNCW joins 12 state institutions that each would receive a baseline of $300,000 yearly for their athletic departments. Appalachian State, East Carolina, Fayetteville State, North Carolina A&T, North Carolina Central, UNC-Asheville, UNC-Greensboro, UNC-Pembroke, Winston-Salem State and Western Carolina are listed as beneficiaries.

Of the remaining revenue, the colleges also would receive 20% more for their athletic departments, 30% would go to the North Carolina Major Events, Games and Attractions Fund, and 50% would go to the state’s general fund.

During the finance committee meeting on May 30, senators said the state could collect as much as $508.8 million from House Bill 347 by the fifth year, should it pass; this is based on a gaming market analysis completed by Spectrum Gaming Group. 

Spectrum estimated there are 7.65 million adults in the state who are at least 21 years old, with an average sports betting handle of $765. Once multiplied, that total equals about $5.85 billion in statewide betting.

Spectrum then estimated an 8.7% hold to achieve the revenue number. That figure makes important assumptions about digital and in-person betting at selected locations throughout the state, as well as betting on the availability of both college and professional sports.

A UNCW representative said the university has been aware of H.B. 347 for several weeks, though did not know yet exactly how the funds will be used or distributed. It all depends on the bill’s final language.

“I can tell you they will support and enhance the student-athlete experience in some way,” UNCW spokesperson Krissy Vick said.

Though the state stands to gain monetarily, the current version of H.B. 347 was not put forth without objections from members of the religious community. Some spoke out that gambling destroys families by dwindling discretionary income.

“Instead of spending on retail goods and essential services, individuals play sports bets, and this can result in reduced revenue, job cuts and closures for small businesses, which can either stall or lower the state’s economic growth array,” said Rev. Mark Creech, executive director of the Christian Action League. “Sports gaming has vast marketing and advertising resources for media platforms, television, radio, print media, websites and mobile apps.”

John Rustin, president of the North Carolina Family Council, said the “human costs” of sports wagering could be tragic. He surmised it could lead to crime, substance abuse and even suicide.

“If passed, House Bill 347 would impose a massive expansion of legalized gambling on North Carolina, as it would legalize state-sanctioned sports gambling on every computer, tablet and mobile phone and Smart TV in the state,” he told senators during Wednesday’s meeting. “Decades of research clearly demonstrates that the more prevalent gambling is, the more forms of gambling that are legalized and advertised, the more citizens will gamble, and of those who do, a significant portion will develop a problem or pathological gambling issue.” 

Not all senators were on board with the bill either. Sen. Julie Mayfield (D-Buncombe) called sports betting as addictive as heroin, cocaine or opioids. She said if the Senate could step into a time machine and regulate opioids and tobacco to provide better safeguards, it would.

“Gambling is already available in North Carolina with guardrails,” Mayfield said Wednesday during the Senate committee meeting. “You have to physically go some place to gamble. It’s only available in a limited number of places. I’m afraid in a decade, we’ll regret limiting the guardrails that we’re considering today.”

Sen. Jim Burgin (R-Harnett, Lee, Sampson) said around $7 billion will be generated in a five-year period, according to the Spectrum report. He also presumed the state’s poorest residents will be the ones placing bets, instead of out-of-state residents, as the report indicated.

“That’s money currently in the state being spent on kids, food, and rent,” he said.

Rep. Charles Miller (R-New Hanover, Brunswick), also a co-sponsor of the bill, declined to give a statement. Attempts to reach Rep. Carson Smith (R-Pender, Onslow) and Sen. Michael Lee (R-New Hanover) were unsuccessful by press.

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