North Carolina sports betting is one House of Representatives concurring vote away from being sent to Gov. Roy Cooper (D) to be signed into law.

The North Carolina Senate approved sports betting bill HB 347 on third reading this morning by a vote of 37-11. It’s the second vote in two days for the bill, with the sports betting legislation now scheduled to be sent back to the House of Representatives for concurrence.

If approved by the house and signed into law by Gov. Roy Cooper (D), North Carolina will become the 28th state to legalize online sports betting. North Carolina already allows brick-and-mortar sports betting in its tribal casinos, but this bill will expand retail sports betting to state stadiums and arenas.

Online sports betting by 2024 likely

One amendment to the bill was floated this morning by Sen. Lisa Grafstein (D-13), who proposed a change that if one section of the bill was found to be unconstitutional, it would declare the rest of the bill unconstitutional. Graftstein and other sports betting opponents believe the proposed 18% sports betting tax rate goes against the state’s constitutional limit of 7% on personal income tax.

The bill was ultimately tabled and not approved by the Senate.

If approved by the House and signed into law by Governor Cooper, HB 347 will legalize 12 online sports betting licenses and brick-and-mortar sportsbooks at “places of public accommodation.” Brick-and-mortar sportsbooks will be allowed on the property of a stadium or arena, or within one-and-a-half miles of the facility. The sportsbooks will only accept cash bets.

These brick-and-mortar sportsbooks will be allowed at up to eight “places of public accommodation” in the state. Each of the licensed stadiums or arenas will be allowed to partner up to one an online sports betting operator.

The bill has been heavily amended by the Senate, but according to Brian Murphy of WRAL, House Speaker Tim Moore (R-111) said the House will concur with the changes as early as next week.

The bill has been amended considerably since its House approval in March, namely by increasing the tax rate from 14% to 18%, allowing a brick-and-mortar betting element, adding pari-mutuel wagering on horse racing, and disallowing sports betting operators to deduct promotional bets from their gross revenues.

Sports betting will be launched in the state “no later than 12 months after the act becomes law.” This likely sets up a sports betting launch sometime in 2024.

The approved bill sets a sports betting tax rate at 18% of gross gaming revenue and allows for pari-mutuel wagering on horse racing. It allows allows bets on professional sports, college sports (including in-state schools), eSports, and the Olympic games.

At an 18% tax rate on gross gaming revenue, the state estimates $22.1 million in total sports wagering tax and fee revenue by FY 2023-2024, which increases to $100.6 million by FY 2027-28.

Proposed sports betting revenue distribution

If approved, North Carolina sports betting tax revenues will be distributed as follows:

  • $2 million annually for gambling addiction and treatment services
  • $1 million annually to Division of Parks and Recreation for the purchase of youth sports equipment
  • $300,000 each annually to seven state universities for their athletic departments
  • $1 million annually to Outdoor Heritage Advisory Council for grants

If there is any remaining revenue, it will be distributed as follows:

  • 20% to 13 historically black colleges and universities for their athletic departments
  • 30% to a fund to attract major sporting events to the state (Super Bowl, March Madness, etc.)
  • 50% to the state’s general fund

Online sports betting licenses will cost $1 million for a five-year license.