How sports gambling bills fell apart in NC House and what could come next

Efforts to legalize online sports gambling in North Carolina stalled this week as a divided House failed to advance one of two key bills. A behind-the-scenes look at how it happened and what comes next.

Posted Updated

Brian Murphy
, WRAL sports investigative reporter
RALEIGH, N.C. — State Rep. John Ager entered Wednesday’s House floor debate intending to vote yes on two bills to legalize online sports gambling in North Carolina.

But the vocal opposition from two fellow Democrats — Reps. Pricey Harrison and Marcia Morey — convinced Ager to change his plan and his votes. The pair were among a handful of representatives to debate against the bill, many of them citing morality and societal costs in their arguments.

Such shifts played a critical role in stalling what appeared, at least to some, to be the likely legalization of widespread gambling in the state, accessible through every mobile device. Now, supporters are regrouping and seeking a path forward for a bill that has been in the works for years. Others are ready to move on for now. Opponents, having won at least a temporary victory, are cheering the outcome.
Although a watered-down version of Senate Bill 38 earned preliminary approval by one vote, its companion, Senate Bill 688, failed by a single vote, throwing into uncertainty a years-long effort to legalize widespread sports gambling in the state.

“It ended up being consequential,” Ager told WRAL News on Thursday. “I feel good about it now. I think I did the right thing.”

Given the tight outcome, each vote — or nonvote — was consequential. It was the rare floor vote in the General Assembly in which the verdict was not known beforehand, adding suspense to the proceedings.

Republican Rep. Jeffrey Elmore voted yes on SB 38 and no on SB 668, which was his plan going into the voting session and the lone difference between the two bills. Rep. William Brisson voted no on both bills, though vote counters had him as a yes entering the vote.

Nineteen members did not vote, though nearly all of them excused absences. Rep. Zack Hawkins, a co-sponsor of companion House legislation, missed the vote after his son’s death earlier this month. House Speaker Tim Moore recuses himself from any gambling-related bills. Rep. Destin Hall, who presided in Moore’s absence, does not typically vote when he’s in charge.

Five other Republicans who were present chose not to vote.

“We had a few people flip their vote. They didn’t do what they said they were going to do,” said Rep. Jason Saine, the bill’s chief House sponsor. “That was somewhat of a surprise. Although I’ve been around the legislature enough to know that when someone gives you their word, it doesn’t necessarily mean that they gave you their word. It was the word that they gave you right then.”

Odds of passage: ‘50-50’

The bills taken together would have legalized online and mobile sports gambling for adults in North Carolina by licensing at least 10 and up to 12 online sports operators. The bills had the support of the state’s major professional sports franchises and facilities, such as Charlotte Motor Speedway.
Legalized online sports gambling in the state could bring in tens of millions annually in tax revenue in addition to licensing fees paid by operators and others in the business.
A divided Senate passed SB 688 last year. SB 38 contained a variety of changes, including raising the tax rate and fees paid by operators and reconfiguring the distribution of tax revenues.

The bills were written to work in tandem, so the defeat of SB 688 is a large blow to passage.

Saine, the top budget writer in the House, is not giving up just yet. Lawmakers are working to wrap up the session by the end of next week, though major issues like the budget, Medicaid expansion, medical marijuana and hemp remain unsettled.

“I would put it at 50-50,” Saine said of passing sports gambling legislation. “Given a window, I’m gonna go through it because we have worked so hard on it. You just never know as budget talks break down, you never know in a negotiation, what may happen. I sit in the budget room, and you never know what I might add to a budget.”

Sen. Jim Perry, who sponsored the legislation, said he has not thought about the next steps. Sen. Phil Berger, the Senate’s top Republican, supported the legislation and said the Senate would wait to see what comes from the House.

“I don’t know that the survival or demise of the sports betting bill is something that should have an impact on what we do as far as the state budget is concerned,” he said.

Other lawmakers seemed ready to move on. There were deep divisions in both caucuses over the issue, which has been percolating for months with many lobbyists working to win votes.

“We’re done with it,” Ager said. “I think it’s a dead issue.’

Changing the bill

Behind-the-scenes negotiations over SB 38 have been going on for months, but the bill was released publicly Monday. It altered several features of SB 688, nearly all designed to make it more palatable to opponents. As it moved through committee, it got altered further.

Betting on amateur sports, defined in the bill as largely Olympics and other international events, was stripped out. The timeline for operators to claim certain deductions, a key to reducing their overall tax bill, was shortened from five years to three. More money was set aside for problem gambling programs. Revenue was directed toward youth sports programs in each county. Low-funded college athletic departments at seven in-state colleges, including five historically black colleges and universities, were added to the distribution formula. More money was directed toward a general fund.

Divisions in the Republican caucus gave Democrats an opportunity to make changes to the bill with thier votes necessary for passage.

“Every amendment that was discussed in advance by whom the minority leader directed us to discuss amendments with, we took every one of them,” Perry said.

The most shocking change, however, came on the House floor—and gave an indication of how tenuous the vote might be. Rep. John Autry, D-Mecklenburg, proposed an amendment stripping all college sports betting out of the bill, leaning into an integrity argument and citing previous point-shaving scandals. The amendment passed easily, likely dramatically altering the amount of revenue the bill would produce in a state crazy about college sports.

“That was my first sign. I was shocked. Shocked,” Ager siad. “That kind of half-guts the bill right there.”

Said Saine: “One of the dumbest votes I have ever seen in the House.”

‘Already a gambling state’

Saine noted that it would reduce the amount of money available for HBCU athletic departments that lawmakers had just worked to fund through the bill.

Rep. Carla Cunningham, D-Mecklenburg, said she was frustrated that the bills did not pass after she worked to get more funding for HBCUs. She said she thinks the issue is not quite dead and dismissed complaints by some about the state getting into the gambling business.

“We are already a gambling state,” Cunningham said. “The lottery says we are a gambling state, and people are going to do whatever they desire to do in that space. I’m not a big gambler. But I know people that do gamble. Everybody goes and buys their lottery tickets. One time we had the video machines and then one time we had that sweepstakes stuff and we shut that down.”

Supporters pointed out that sports gambling is happening in the state already, either through off-shore accounts or with people traveling to Virginia and Tennessee to place legal wagers. Sports gambling is legal in two Cherokee casinos in the western part of the state.

Morey, a member of the 1976 U.S. Olympic swimming team and a former investigator with the NCAA, proposed an amendment that would have allowed for in-person, cash-only sports wagering at a handful of sports facilities around the state. She called it a compromise between the current two gambling locations and the proposal to allow sports gambling on every mobile device. It failed.

But the outcome is not likely the final word on increased sports gambling in the state.

“The issue is never going away,” Saine said. With everyone on record, Saine said, the public will get a chance to weigh in. “They'll hear from constituents, they’ll hear from folks across North Carolina that want sports wagering.”


Copyright 2023 by Capitol Broadcasting Company. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.