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North Carolina lawmakers pushing to legalize video gambling

North Carolina sports betting bill - Governor Roy Cooper expands gambling

The North Carolina House committee introduced a new bill on Tuesday which would legalize video gambling in the state.

House Bill 512 is sponsored by Republican Rep. Harry Warren and is similar to a 2021 measure he supported which ultimately stalled.

If approved, the bill would regulate gambling machines in North Carolina and, in the process, supply the state with significant tax revenue. The proceeds would be used to fund higher education and similar programs in the state.

HB 512 also aims to rid North Carolina of illegal gambling activity in operation inside sweepstakes machine parlors. Under the measure, the North Carolina State Lottery Commission would oversee the distribution of gambling machines and contribute to stamping out illegal activity in the state.

The lawful machines would be distributed to venues with alcohol licenses, like restaurants, bars, and convenience stores. Per the measure, game manufacturers and owners would receive licenses, while operators would need to sub-contract the machines from them.

A central monitoring system would be set up to link the authorized terminals, create regulations, and conduct criminal checks of the license applicants. The aid of the State Alcohol Law Enforcement would also be enlisted.

A previous evaluation of HB 512 by General Assembly fiscal analysts revealed that by mid-2028, North Carolina could receive up to $350 million in tax revenue every year. The money would be used for state education and law enforcement grants.

The evaluation also concluded that by that time, around 20,000 lawful gambling machines would be in place, which could generate approximately $1.1 billion in revenue annually.

A quarter of the net terminal revenue would go to retailers with around 10 machines in operation, while gambling machine operators can get up to 35%. A big cut of the state’s gaming revenue would be used to fund a forgivable loan program to help community college students.

According to dissenters of HB 512, the bill should not be supported because video lottery terminals are connected to some of the most prominent gambling harms.

“Video lottery terminals are linked to the worst gambling harms. So why would we say yes to a bill like this one?” Rev. Mark Creech from the Christian Action League of North Carolina said.

Warren, however, pointed out that the bill would reduce the amount of illegal video gambling and sweepstakes machines in the state. He estimated that around 60,000 and 100,000 gambling machines were currently in operation.

“The real reason that these things flourish is because people play them,” Warren stated.

“By restricting, regulating and reducing the supply, we can eliminate sweepstakes parlors and the seedy aspects of unregulated gambling, replacing it with a limited supply of gaming entertainment that fulfils the public demand in a safer, controlled environment and safer conditions.”

Other dissenters of Warren’s bill include the North Carolina Sheriffs’ Association, which opposed the previous measure in 2021. The association’s executive vice president, Eddie Caldwell, stated that it is currently pushing for amendments due to law enforcement concerns.

The Senate did not issue a vote on Tuesday to decide on the proposal, and it remains to be seen if it will receive further traction. HB 512 will need to be approved in four House committees before getting to the House floor.

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