Mobile sports betting in NC would begin Jan. 1 if new bill passes

A bill was filed Monday morning to legalize mobile sports gambling in the North Carolina. A similar bill failed by a single vote last year.

Posted 12:40 p.m. Mar 9, 2023 — Updated 5:08 p.m. Mar 14, 2023

Brian Murphy

, WRAL sports investigative reporter

RALEIGH, N.C. — A new bill in the North Carolina legislature would permit wagering on sports from cellphones and other electronic devices in the state as of Jan. 1.

A similar measure was approved by the state Senate in 2021, but it failed in the North Carolina House by a single vote last year. Legislative supporters are confident they have the votes to pass the bill this session. Opponents, who argued against gambling on moral grounds and for societal ills they say it can cause, were able to raise enough concerns to stop the bill last year, and many critics remain in the legislature.

House Bill 347 was filed in the House on Monday morning. The bill's other main sponsors are Republican Rep. John Bell, the House majority leader, and Democratic Reps. Zack Hawkins and Ashton Clemmons. The proposed legislation permits betting on professional, college, electronic and Olympic sports. It allows for up to a dozen operators to acquire a five-year, $1 million renewable license to take bets in the state.

“This bill is a bipartisan bill and we’ve learned a good bit from both sides about some of the tweaks that needed to happen,” said Jason Saine, a Lincoln County Republican and sponsor of the legislation. “We’ve worked to accommodate those concerns, and we believe we have a bill that can do better than pass. It can get broad support from both caucuses.”

The legislation is similar to the final House version of last year’s bill, which underwent drastic revisions after passing the Senate, including increases in fees and taxes for operators and changes to the revenue distribution.

North Carolina’s professional sports teams have backed legalization efforts, and the law would allow sports lounges at certain venues across the state, including Raleigh’s PNC Arena and Cary’s WakeMed Soccer Park. Charlotte Motor Speedway in Concord and Charlotte’s Bank of America Stadium and Spectrum Center would also be permitted to open lounges or “places of public accommodation,” where gamblers could place bets through their online accounts.

A 2018 U.S. Supreme Court decision struck down a law that barred widespread sports gambling outside of a few states, most notably Nevada. More than 20 other states now allow mobile sports gambling, including Virginia and Tennessee. North Carolina allows sports gambling in person at three tribal casinos owned by the Eastern Band of Cherokee Indians and the Catawba Nation.

The North Carolina State Lottery Commission would be in charge of awarding licenses and regulating the industry.

Operators would be subject to a 14% privilege tax on gross wagering revenue, though they would be able to deduct bonus or promotional credits at declining rates through the end of 2026. Virginia, which legalized mobile sports gambling in January 2021, collected $20.3 million in taxes in 2021 and $49.9 million in 2022, according to the Virginia Lottery. Virginia taxes gross revenue at 15% and in late 2022 cut down on deductions.

Users must be physically present in a legal state to place a wager, leading some in North Carolina to cross the border to bet on sports. Operators use geofencing to restrict access to sports betting apps from out of state.

More than $3.2 billion was wagered in Virginia in 2021 and more than $4.9 million was bet in 2022. Virginia doesn’t allow betting on its in-state college sports teams and the commonwealth, unlike North Carolina, does not have any major professional teams, though many in populous Northern Virginia follow Washington, D.C.’s teams.

Republican legislative leaders this week agreed to spend $29.7 billion in 2023-24's state budget.

The tax revenue generated from operators would be distributed to several entities around the state, including $2 million to the state Department of Health and Human Services for gambling addiction education and treatment programs. The current budget for the North Carolina Problem Gambling Program is $1 million and it has one full-time employee dedicated to the program. March is Problem Gambling Awareness Month.

Ohio, which legalized mobile sports gambling in January, reported 48 calls per day to its problem gambling helpline in the first month of legalization, compared to 15 calls per day in January 2022 and 20 calls per day in December 2022, according to Ohio For Responsible Gambling.

"There’s the potential for a sharp increase in gambling addiction," Rep. Pricey Harrison, a Guilford County Democrat, said during a recent episode of "On The Record" devoted to the topic of sports gambling. "The amount of money being put in gambling addiction is insufficient, it’s a fraction of what’s needed."

The legislation includes $1 million for the state Division of Parks and Recreation to award $10,000 grants per county for youth sports equipment and facility improvements, as well as $1 million for the North Carolina Outdoor Heritage Advisory Council for grants to help teams travel for competitions and to attract sporting events and tournaments.

Low-funded athletic departments at seven state universities would each receive $300,000 annually. Elizabeth City State, Fayetteville State, North Carolina A&T, North Carolina Central, UNC-Asheville, UNC-Pembroke and Winston-Salem State are included in the bill, plus 10% of remaining revenue.

A new fund to attract major sporting events to the state would receive 30% of the remaining tax revenue, and 60% would go to the state’s general fund.

Some of the items that opponents of legalization argued against are in the bill. Opponents successfully stripped wagering on college sports last year on the House floor, but it is in the bill this year. So, too, is the ability of gamblers to fund their accounts by using a credit card, a sticking point for some critics.

Harrison, who led the opposition to the measure on the House floor last year, said she is not opposed to all sports betting. She said she could support a more modest expansion, such as allowing in-person wagering at certain venues across the state.

"It’s a predatory industry," Harrison said. "And it’s looking to raise money. It isn't looking to raise money for our state, it’s looking to raise money for the industry."

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