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North Carolina Nearing Finish Line for Online Sports Betting

North Carolina Nearing Finish Line for Online Sports Betting article feature image

Photo by Lance King/Getty Images. Pictured: Bank of America Stadium

North Carolina could pass online sports betting any time this week.

Both the House Finance and House Rules Committees approved two bills (S.B. 688, S.B. 38) Wednesday that would authorize up to 12 sports betting apps throughout North Carolina, where only in-person betting is currently allowed.

After gathering dust all year, each bill has cleared three committees in the past 24-hours — setting them up for final passage at any time. Online sports betting could start no earlier than January 1, 2023.

The full-House is slated to take up S.B. 688 during its Wednesday evening meeting.

Tandem of Bills Steps From Passage

The product of behind-the-scenes negotiations, S.B. 38 was gutted and replaced Tuesday to up the tax rate in S.B. 688 from 8% to 14% and to make a few other changes. Advancing them in tandem should help the General Assembly meet the June 30th deadline to get something to Gov. Roy Cooper.

“We had no idea that we’d get hung up on budget related conversations that caused delays,” bill sponsor Sen. Jim Perry said during the Rules Committee hearing. “That’s why both bills are running at the same time.”

S.B. 688 passed the Senate last year and just needs a House vote, while S.B. 38 needs House and Senate approval before it can be sent to Cooper.

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Amendments Incoming

There will be at least one amendment offered during the House vote.

Rules Rep. Destin Hall allowed his colleagues to take up only one amendment to S.B. 38 during their hearing and told interested lawmakers to hold their proposed changes for later.

The amendment, passed unanimously, shortens the time in which sportsbooks can deduct revenue tied to promotional credits from their taxable income from five to three years.

Earlier Wednesday, the Finance committee passed a few more amendments, that mostly change where revenue is distributed under the larger tax:

  • 10% of revenue to Historically Black colleges and universities, athletic programs at UNC-Pembroke and UNC-Asheville
  • 30% of revenue to attract sporting events with high economic impact potential for the state
  • $2 million for problem gambling services

College Betting, Tax Structure May Change

During Tuesday’s hearing in the Judiciary committee, Rep. Pricey Harrison took issue with the tax structure, as well as an amendment she had hoped would prohibit wagers on college sports.

Under that amendment only Olympic betting is banned. Harrison did not respond to Action Network’s request for comment, though she’s expected to propose a college betting ban during the House vote.

She or another lawmaker may also introduce an amendment that further addresses the tax structure. Under S.B. 38 sportsbooks would pay a 14% tax though they’d be afforded deductions not only for promotional credits, but for deposits tied to promotions.

That language hasn’t popped up in any other state and it’s unclear what definition would be used to determine when a bettor’s deposits is tied to a promotion.

Cooper is expected to sign S.B. 38 should it reach his desk.

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