Senate advances bill to legalize online sports betting


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Oct 07, 2023

Senate advances bill to legalize online sports betting

By Shaun Robinson May 3 2023May 3, 2023 The Vermont Senate granted preliminary

By Shaun Robinson

May 3 2023May 3, 2023

The Vermont Senate granted preliminary approval Wednesday to a widely anticipated bill that would legalize online sports betting in the state, tweaking some of the proposed regulations in the version passed by the House.

The legislation would allow up to six companies — such as DraftKings and FanDuel — to operate what's known as a "sportsbook" in Vermont. The bill, H.127, would create a dedicated fund to hold the revenue and fees the state would collect in its role overseeing the market, and set aside some of that money for programs and resources targeting problem gambling.

Online sports betting, which is legal and operational in more than half of U.S. states, can be more addictive than traditional, in-person gambling — and it can be especially attractive to young people, experts have told Vermont lawmakers this session.

"It's got lots of guardrails," said Sen. Alison Clarkson, D-Windsor, presenting H.127 on the Senate floor. "A lot of attention has been paid to ensure responsible gaming."

The Senate's version of H.127 maintains a House proposal that Vermont take at least 20% of the adjusted gross revenue that sports betting operators make in the state each year. But it changes the operating fees that the state would charge each company.

In the Senate bill, each operator would be charged a $550,000 fee no more than once every three years. The House, meanwhile, proposed charging operators an annual fee that would vary based on how many other companies were in the market — from $550,000 a year for one operator, down to $125,000 a year for six operators.

Sen. Thomas Chittenden, D-Chittenden Southeast, said the Senate Finance Committee — which he sits on — thinks this change would encourage sportsbook companies to operate in Vermont for longer periods of time. And higher fees for more companies, Chittenden suggested, could also bring in more revenue for the state.

The Legislature's Joint Fiscal Office has projected fairly modest revenue from legal sports betting — about $2 million — in the 2024 fiscal year. That figure is expected to increase to between roughly $4.5 million and $10.5 million in 2025, then level out around $10 million each year after that, Clarkson said on Wednesday.

Senators also agreed to cut language from the House version that would cap the amount of money sports betting operators could spend on advertising.

The cap was pitched by the House Ways and Means Committee in response to some lawmakers’ concerns that Vermont could become saturated with sports betting advertisements — a trend that's been widely reported in other states.

Clarkson said she and other senators on the Economic Development, Housing and General Affairs Committee thought that the bill should avoid being "too prescriptive" about the agreements the state would reach with sports betting operators for their advertising plans. The committee heard as much, she noted, from lawmakers and state officials who have studied proposals for a legal sports betting market in Vermont.

Wendy Knight, commissioner of the state Department of Liquor and Lottery — which would oversee the market — has said she's confident that her agency could develop stringent advertising guidelines without a monetary cap imposed by lawmakers.

"Hopefully we can get a strong plan that does protect Vermonters, especially those in the 18-to-21 age range that might be susceptible," said Sen. Andrew Perchlik, D/P-Washington, on the floor Wednesday.

H.127 would require sports betting companies to "limit" advertising aimed at people under age 21 — who would be, at least legally, barred from wagering platforms — as well as prohibit the companies from targeting college campuses with their ads.

Another amendment tacked onto the bill Wednesday, courtesy of the Senate Judiciary Committee, doubles the fines that the state would charge to any company or organization that operates unlicensed sports betting in the state.

The fines would now be $50,000 for a first offense, $150,000 for a second offense, and $300,000 for all subsequent infractions, according to the text of the amendment.

The amendment also gives state officials access to more resources when conducting background checks on the people and companies proposing to operate sports betting platforms here.

H.127 still must get final approval from the Senate before returning to the House for its review. Lawmakers expect that, if the bill becomes law, a legal sports betting market would be up and running in January 2024.

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