Georgia Now Heading Down Longer Road To Legal Sports Betting

It’s looking a lot more like Georgians won’t be able to bet on sports until 2023, at the earliest. After a sports betting bill that called for the expansion of lottery offerings to include sports wagering was pulled from the House floor Thursday morning, a Senate committee subbed out its sports betting bills and introduced referendum language. After an hour of discussion and testimony, both substitutions passed the Senate Regulated Industries and Utilities Commission by a show of hands.

Committee Chairman Bill Cowsert opened the meeting by patiently explaining why the constitutional amendment would be needed and then laid out new options for statewide mobile wagering that would include referendum language, a drop in the proposed annual licensing fee, and a 16% tax rate on gross gaming revenue. The proposals would allow for wagering on professional and college sports, but would prohibit betting on Georgia college teams.

“We’ve talked a lot about this in our committee about whether or not we need a constitutional amendment unless it’s a lottery game,” Cowsert said before introducing substitutions. “I’ve come to the conclusion [as have others], that calling sports betting a lottery game is a stretch. … We’d be on pretty thin ice here to convince a court that sports betting is a lottery game.”

The proposed referendum language now in SR 135, which would appear on the November 2022 ballot currently reads:

“Shall the Constitution of Georgia be amended so as to authorize sports betting in this state and to provide for such proceeds to be used for need-based educational funding, scholarships, rural health care services. and deployment of broadband to unserved areas.”

More uses for sports betting dollars

Cowsert said the “chatter in the hallways” likely indicates that the House didn’t have enough votes for a bill sponsored by Rep. Ron Stephens that would attempt to bypass amending the constitution. That bill passed the House Rules Committee earlier this week, and there’s long been a disagreement among lawmakers and stakeholders about whether or not a constitutional amendment is needed.

Another key to the proposed substitutions, according to Cowsert, is that by sending sports betting to the voters, it could change how tax revenue from wagering would be spent. Currently, lottery proceeds are earmarked for the state’s educational HOPE Program. The ballot initiative instead would fund needs-based scholarships and rural health care, in addition to helping to “deploy” broadband internet to underserved locations in the state.

There was limited discussion about the substitutions that mostly centered around how much money the state could expect to receive from sports wagering, what the point of legalizing would be if the black market would continue to exist (which it would, since the bill would ban wagering on Georgia college teams), and the ills of sports betting.

According to Cowsert, the state should expect $25-$50 million in tax revenue, which some senators thought was a lower number than they might have expected. But Cowsert was clearly trying to temper expectations, when he essentially told his peers that sports wagering wouldn’t be a get-rich-quick fix for the state.

With regard to what the point of legalizing at all would be, senators offered these thoughts:

“Currently, if it’s done illegally, you don’t have liens on your house, you got Guido coming to break your legs if you don’t pay. If it’s legal, that doesn’t happen,” said Sen. Jeff Mullis.

Said Sen. David Lucas: “Part of the problem with illegal gambling is there is no guarantee you are going to get your money.” And then he went on to talk about how a bookie could “forget” a gambler’s number and never pay him/her.

When a hamburger isn’t a hamburger …

On the flip side, there were two witnesses who testified in opposition to any sort of gaming expansion. Both made the usual arguments about how legal wagering will cost the state more that it will earn, and how kids will be hooked into a bad habit before they’re old enough to know it. But they also offered some interesting comments, including:

“You don’t hear too many people say, ‘The families who gamble together stay together,’” said Mike Griffin, head of public affairs for the Georgia Baptist Mission Board.

Or this from anti-gambling activist Virginia Galloway, who herself has been before the committee before and said she’d continue coming as long as expanded gaming is on the table.

“What separates commercialized gambling from other businesses is that it is essentially a con game,” she said. “If you pay for a hamburger or a ticket to a sporting event … that’s what you get in return. In commercialized gambling, you might get something. But it’s rigged against you.”

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