On crossover day, the final day for the Georgia General Assembly to pass legislation, the Senate approved two sports betting measures — one that would send the decision about whether or not to legalize to the voters, and the enabling legislation with framework. The referendum proposal, if it passes the House, will be on the November 2022 ballot, meaning that sports betting operators would not go live in Georgia until sometime in 2023, at the earliest.
Georgia lawmakers have been struggling with whether they could pass legislation that would expand the definition of gaming for the Georgia Lottery to include sports betting, which would have allowed them to bypass the referendum process and legalize sooner. But in the end, legislators determined that amending the Georgia constitution was the only legal way to legalize.
To that end, a House bill that would have legalized through the lottery was withdrawn earlier this week, and a similar bill in the Senate was amended after the referendum bill was passed. SB 135, a five-page bill that does not include referendum language, passed 41-10, beating the required two-thirds majority. About a half hour later, after much debate about minority opportunities and a fair amount of pleading by sponsor Jeff Mullis, an amended version of SB 142 passed, 34-17. The amendments essentially make it clear that SB 142 is enabling legislation and added “veteran-owned” and “women-owned” to the definition of minority businesses.
“For the amendments, vote your conscience,” Mullins told his peers ahead of the vote. “This process is going to move down the road, and it’s going to change. Just like the constitutional amendment. This is the nuts and bolts of it, but if we don’t put it together properly, then the bookies are going to run this.”
Earlier in the debate, he said. “I need 29 of you and I need you badly. I love you all, but I’d love you more” for backing the measure.
Sports betting framework still up for discussion
The expectation, at least according to Mullis, is that the issue of sports betting will go to a conference committee with representatives from the House. Because of that, and the opportunity it presents, he suggested that much of what’s in his bill is up for debate, including the tax rate, license fees, and possibly the official league data mandate.
SB 135 names the Georgia Lottery Corporation as the regulator but allows it to create a gaming commission. The measure also allows for the lottery to offer its own sports betting platform. The bill calls for tax revenue to be earmarked for multiple educational programs, rural health care services, and expanding the availability of broadband internet.
Georgia or New York: Which state will regulate sports betting first? @DavidPurdum sets the line for both.
— US Bets (@US_Bets) February 26, 2021
SB 142, called the Georgia Lottery Mobile Sports Integrity Act, would allow for statewide mobile sports betting and a minimum of six licenses, while enabling Georgia’s professional sports teams to partner with sportsbook operators. The bill sets the tax rate at 10% and does have an official league data mandate, though Mullis also said both are open for negotiation.
“Data is up for grabs. It’s in the bill, and we’re going to let the sports teams control the data rather than some third party that might not be reliable,” he said.
Under the proposal, bettors 21 or older would be allowed to wager on professional, Olympic, and college sports, though wagering on Georgia college teams is prohibited. Mullis said the college carve-out concession was made after officials from the University of Georgia system requested it.
Raising application/license fees discussed
A key change made between when the bill was introduced and when it reached the floor was in relation to application and licensing fees. The bill initially called for an application fee of $50,000 with a $900,000 renewal. Those numbers have been reduced to $10,000 and $100,000, as Mullis said he wanted to make sure local Georgia businesses could afford to apply.
The tax rate and application/license fees came up during debate, when one senator said she thought the fees were “incredibly low” compared to the “hundreds of millions” that national sports wagering companies make annually. She also pointed to Pennsylvania, with its 36% tax rate and $10 million application fee, as a model to aim for.
House Minority Caucus Chr. Rep. Billy Mitchell says Dems are holding up a bill to legalize sports betting in Georgia not only because of the GOP election reform bills but also because no needs based scholarship was included nor provisions for minority vendors. @wsbradio #gapol pic.twitter.com/JFIdaTYMYz
— Sandra Parrish (@WSBParrish) February 26, 2021
On the House side, HB 86, which would have legalized sports wagering through the lottery, was withdrawn earlier this week after it failed to get support. Media outlets reported that the Democrats were withholding votes due to an election-reform issue and other concerns.
From here, the bill will be sent to the House for consideration, though it appears the end game is for lawmakers to meet on the issue in conference committee. By going that route, lawmakers can continue to debate and refine. The session ends on April 2, and should the sports betting bills get to Gov. Brian Kemp, he has 40 days to sign or do nothing and the bills become law.