Mobile-Only Bill Gets Over First Hurdle In South Carolina

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South Carolina’s House Ways and Means Revenue Policy Subcommittee moved forward an amended digital sports betting bill Thursday, marking the first time that lawmakers in the Palmetto State have taken action on legal wagering. The bill will now go to the full Ways and Means Committee.

HB 3749 would allow only for mobile wagering and would tie some licenses to the state’s PGA Tour stops as well as NASCAR’s Darlington Raceway. Representatives from both of those entities spoke in favor of the bill.

According to its sponsor, Rep. Christopher Murphy, the bill provides for up to eight digital platforms in South Carolina and includes wagering on college and professional sports. It would set the tax rate at 10% of adjusted gross revenue, with 18 set as the legal age for betting. Murphy noted the legal wagering age is in line with the state’s age for purchasing lottery tickets, though the vast majority of states have set the legal sports betting age at 21.

The bill is modeled after one in Tennessee, the first state to legalize digital-only wagering. Since then, Wyoming lawmakers last year made mobile-only betting legal, and Vermont lawmakers are currently considering walking down a similar road.

One of South Carolina’s border states, North Carolina, already offers legal wagering, though it is only at tribal casinos. A bill to legalize digital wagering in North Carolina has passed through the House for consideration by the Senate. Georgia lawmakers for the third consecutive year have been unable to come to a consensus to act on a bill.

SC companies would get a leg up

Murphy said that “the hope of this legislation would be to eradicate that illegal wagering that is happening across South Carolina.” When asked if it would completely stamp out black-market betting, he suggested that across the country “upwards of 80%” of illegal wagering had been eliminated in states that had legalized.

The bill that passed out of the subcommittee was amended to add a “master operator” license, which would be a South Carolina-based entity that would hold a license and then contract with up to four wagering operators. The idea behind the amendment is to give some South Carolina businesses a leg up and keep more economic benefit within the state. The master operator would be allowed to launch its wagering platform six months ahead of other commercial operators, which is reminiscent of the Illinois law that was designed to give local licensees an 18-month head start over standalone mobile platforms.

The only two witnesses speaking at the subcommittee meeting Thursday were representatives from NASCAR and the PGA Tour, both of whom said that legal wagering can increase fan engagement and interest in their sports. Both expressed gratitude for being included in the bill and support for it going forward.

Though several others had signed up to testify, none were present, and with no opponents appearing against the bill, the House members had few questions before moving it forward.

5% of tax revenue earmarked for RG programs

In introducing the bill, Murphy said that studies have estimated that as much as $2.5 billion is bet illegally in South Carolina annually. By legalizing, he said, the state could “conservatively” capture $23 million in tax revenue, 5% of which would be earmarked for responsible gaming programs. Fifteen percent of tax revenue would be funneled back to cities and towns, and 80% would go into the state’s general fund.

Operators would be charged a $50,000 application fee that would be refunded should they fail to be licensed. The license fee for those approved would be an additional $450,000. Operators would have to be active in at least five other states in order to win a license in South Carolina.

The bill would create a new commission to oversee wagering.

The South Carolina Legislature is set to adjourn May 11, and the crossover date for legislation is April 10, which means that the House has less than two weeks to approve the bill and send it to the Senate.


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