Georgians likely will have to wait an additional two years for a legal sports betting option within the state’s borders.
The Georgia legislature adjourned for the year on Monday night without passing sports betting legislation.
Once again, the roadblock came in the House.
Just like last year, he tried different ways to get sports betting done until the final hours of the session. Stephens spoke with PlayGeorgia on Tuesday about why Georgia sports betting wasn’t able to cross the finish line.
Trouble begins in House committee
Stephens introduced his substitute language for the bills on March 28. First, he ran them by the Republican Caucus. Hours later, he amended the Senate bills in his House Committee on Economic Development and Tourism.
He told PlayGeorgia that day that the Republican Caucus was split 50-50 on the bills. That was the first indication that the effort was in doubt. But he had tentative approval to move forward.
In committee, he received pushback from Republican colleagues. They didn’t like that Stephens added removal of the ban on all forms of gambling to the constitutional amendment. Not just sports wagering, as passed by the Senate.
Georgia doesn’t have commercial casinos. Their enabling had come in front of the legislature in recent years. While running the ballot measure to allow for sports betting, Stephens hoped to remove the barrier for casinos and pari-mutuel betting as well.
That would only clear the way for the legislature to consider enabling bills on casinos and pari-mutuel betting in the future.
Rep. Randy Nix attempted to strike the other forms of gambling from the resolution in committee. With Stephens objecting, the amendment failed.
But by Wednesday, Stephens agreed to keep the constitutional amendment to sports betting in trying to save support for the bill. It wasn’t enough.
Religious coalitions doom bill
On Monday, Stephens told PlayGeorgia that he hoped to get the bills a House vote on Wednesday and give the Senate time to concur or form a conference committee.
But as soon as the bills got through his committee, Stephens said his colleagues were inundated by anti-gambling lobbying from the Georgia branch of the Christian Coalition of America and the Southern Baptist Convention.
“We had an uprising if you will once this thing got out of committee,” Stephens said. “It came from the same people who tried to kill our HOPE Lottery 30 years ago. At the end, a lot of my colleagues started thinking about getting elected and became paranoid that this issue might jump in between them somehow.”
The Democratic Caucus was in favor of the bills, pleased that 50% of sports betting tax revenue would go toward tuition grants, scholarships, loans, and other educational services to citizens whose household income is below the state median. The other half goes toward traditional HOPE scholarships, where lottery funds go now.
But already tentative Republican support began to waver against the onslaught from the religious coalitions. Legislators face a primary next month prior to the November elections, and coalition representatives threatened to make known their stances on gambling expansions.
Stephens, who teaches Sunday school and whose wife plays the piano at church, scoffs at the anti-gambling rhetoric from religious organizations.
“In Acts 1: 15 -26, Matthias won his way to the 12th apostle by casting lots, which is essentially the lottery,” Stephens said. “And he did that right in front of Jesus himself. So don’t tell me the bible is against gambling. They’re twisting the bible to say something they want it to say rather than what it does.”
Sports betting industry muddled support
The sports betting details worked out by Stephens weren’t the most industry-friendly.
Key details included:
- Eligibility for retail sports betting licenses limited to pro sports teams (Braves, Falcons, Hawks, Dream, Atlanta United, Atlanta Motor Speedway, the Masters, Michelin Raceway Road Atlanta and the PGA Tour, so long as two events are in Georgia).
- 18 online sports betting licenses, half for sports entities and half free-floating.
- The Georgia Lottery Corporation could put sports betting kiosks in retail locations that offer lottery products.
- Sports teams and operators pay $1 million annually for a license, with an application fee of $100,000.
- Between five and 10 Type 2 distributors may contract with the GLC. Each distributor pays a $100,000 annual license fee and $10,000 application fee.
- Type 1 licensees pay a 20% tax rate on adjusted gross income. Type 2 licensees pay 20% on gross revenue.
- Credit cards aren’t allowed to place sports bets. Wagers can be made using cash, debit cards or wire transfers.
Industry lobbyists argued that the $100,000 annual distributor license fee was way too high. Stephens said he was willing to remove the Type 2 licenses and figure that portion out later.
But the industry also sought to deduct promotional credits from adjusted gross income. Neighboring Tennessee, one of the models for Stephens’ bill along with Ohio, has a 20% tax rate and does allow sportsbooks to deduct promotional dollars given to patrons.
Stephens wasn’t amenable to this change, and then was upset when lobbyists tried to go above his head.
“They kept trying to manipulate the bill,” Stephens said. “They want to give all these credits away, which creates a shell game and the people of Georgia are holding the bag. They’re part of the reason it died, unfortunately. Essentially, they cut their own throats.”
Senate wouldn’t do sports betting without constitutional amendment
Passing a resolution amending the state constitution requires a two-thirds vote of the legislature. There are 180 members of the House, meaning SR 135 needed 120 votes.
With his fellow Republicans hearing from religious groups and fearful for re-election, 120 wasn’t going to happen.
However, the sports betting enabling bill only required a majority vote. And Stephens told PlayGeorgia that he had 91 votes if leadership chose to put SB 142 to a floor vote.
On Friday and Monday, knowing that the resolution couldn’t pass, Stephens tried to push for the enabling bill without a constitutional amendment.
Last year, Stephens argued that Georgia sports betting through the lottery didn’t need a constitutional amendment. The constitution allows for lottery games. However, the Senate decided otherwise.
Stephens spoke with Senate colleagues at 9 p.m. Monday to see if they would be receptive to receiving the enabling bill without a constitutional amendment.
“They really are pretty steadfast for a constitutional amendment, and I don’t blame them,” Stephens said. “Had we sent the substitute sports betting bill with a constitutional amendment only for sports wagering, the Senate would have concurred.”
In one final insult, the House did pass SR 135. But only after gutting it and substituting a resolution related to the taxation of timber.
Georgia sports betting starts over next year
In beginning a new two-year session in 2023, Georgia sports wagering legislation starts from scratch.
Stephens, who has served in the Georgia House for 25 years, is running for re-election. He plans to introduce sports betting legalization once again.
“I’ll be back with a sports wagering bill for the 2 million kids who have gotten a HOPE scholarship, and for those 1.6 million families in Georgia that have gotten a head start with pre-K,” Stephens said.
Stephens expects a lot of turnover in the House and Senate. He thinks that will help the prospects for sports betting.
“As always with new faces, they’re typically younger,” Stephens said. “A lot of candidates took HOPE scholarships and their families took pre-K funding, so it’s hard for them not to support this.”
However, the next election to put a constitutional amendment in front of voters isn’t until November 2024. Stephens said he might just try to run the sports betting enabling bill next year. That way the Georgia Gaming Commission can form and get working, and he can come back with the constitutional amendment in 2024.
So, by failing to pass legislation this year, Georgians likely won’t have a legal option to bet on sports in the state until 2025.
As the Georgia legislature let another year slip by without legalizing sports gambling on Monday, Stephens tells PlayGeorgia that he took out his phone and placed a bet on an offshore sportsbook taking North Carolina in the NCAA Tournament championship game that night.
With the state’s largest metropolitan area of Atlanta about a two-hour drive from the closest legal sports betting option in Tennessee, many more Georgians will use illegal offshore betting apps over the next three years with the state capturing none of the revenue.
Photo by Jason Behnken / Associated Press