NC Lawmakers Draft Amendment to Sports Betting Bill
June 17, 2022
iDEA has obtained a new draft bill by North Carolina lawmakers that will replace existing legislation related to sports betting that has already passed the Senate- the “gut and replace” amendment (see here).
The expectation is that this bill will be heard next week in the House Judiciary committee and will be amended into another bill that has already passed the Senate. The legislation will still need to be voted out of the full House before June 30th. We believe this can done in the next 10 days.
The proposed changes to in the draft bill would:
- Increase the tax rate from 8% to 14%. (placeholder in the draft bill, but we understand 14% will be the effective tax rate)
- Change the tax from a tax on adjusted gross revenue to an excise tax.
- Double five-year license fee from $500,000 to $1 million.
- Increase the license renewal fee from $100,000 to $1 million.
- Increase fees on service provider licenses from $25,000 to $50,000 and renewals from $10,000 to $50,000.
- Increase fees on supplier licenses from $15,000 to $30,000 and renewals from $5,000 to $30,000.
- Allow wagering on horse races, which isn’t allowed in current SB 688 and not in preliminary version of new legislation, but is expected to be added before Tuesday’s hearing.
- Expand definition of sports facility that is allowed to have on-premise sports lounges to include facilities that host NASCAR races (with minimum of 17,000 seats), facilities that host professional golf tournaments with more than 50,000 live spectators anticipated to attend and facilities that are the home locations of teams in Major League Baseball, Major League Soccer, the National Basketball Association, the National Football League and the National Hockey League. North Carolina does not currently have an MLB team.
- Modify revenue distribution. The Department of Revenue gets up to $500,000 for administrative expenses off the top. The remaining net proceeds of the tax collected is distributed as follows: 50% to the newly created North Carolina Major Events, Games, and Attractions Fund; 5% to the North Carolina State Lottery Commission; $1 million to the Department of Health and Human Services for gambling addiction and education programs; and the remainder to the General Fund.