The North Carolina Senate gave what could be its final approval on Thursday to a bill that would authorize online sports betting sites in the Tar Heel State.
House Bill 347 passed its third reading vote in the Senate by a margin of 37-11. The state’s House of Representatives must now concur with changes made to the legislation in the Senate (which they are reportedly set to do) or hammer out a compromise with the other chamber.
Once both the House and Senate have agreed on an identical version of H.B. 347, the bill can head to the desk of Gov. Roy Cooper, who said he will sign it into law. An online component of North Carolina sports betting can then be implemented as early as January 8, 2024, as the state already has retail wagering at three tribal casinos.
Agree to... agree
House Speaker Tim Moore reportedly told local media on Thursday that the House will sign off on the changes to the legal sports betting bill early next week.
"We're going to concur Tuesday and Wednesday," Moore said, according to WRAL.
The passage of H.B. 347 means another state is on the verge of legalizing online sports betting sites. With North Carolina on board, 28 states plus Washington, D.C., would have authorized some form of mobile wagering.
The passage of online sports betting legislation also means that operators are on the cusp of tapping one of the biggest untapped markets remaining in the United States. With a population that would put it behind Ohio but ahead of Michigan among legal wagering states, North Carolina will likely attract attention from all the big names in the gaming industry.
It's evolution, baby
H.B. 347 has evolved in the Senate, going from a purely online sports betting bill to legislation providing for retail sportsbooks at or near professional sports venues and for pari-mutuel wagering on horse racing. Residents will have to be 21 or older to wager.
Up to 12 operators could receive licenses but will also pay a $1-million licensing fee and an 18% “privilege” tax to the state. The tax rate is a touchy issue in North Carolina, as the state has a constitutional cap on income taxes of 7%.
Sen. Lisa Grafstein tried and failed on Thursday to amend H.B. 347 so that if one section of the bill were found unconstitutional by the courts, the rest would have no effect. In other words, if the tax provision were struck down the rest of the online wagering legislation would be struck down. Currently, H.B. 347 states that if any section is declared invalid, it will not affect the validity of the rest of the bill.
Senators, however, rejected the amendment, although the tax issue may not fade away entirely.
“I'm not a mathematician, but 18 is more than seven, which is the constitutional limit on income tax,” Sen. Grafstein said during the Senate’s session on Thursday. “And so the legal question seems to be whether this is an income tax or not. And there seems to be, and there is, I think, significant concern about the constitutionality of the revenue provision.”
