The Vermont Senate has granted preliminary approval for Bill H127, which would see online sports betting legalised in the state. This approval has been subject to several tweaks in addition to the bill initially proposed by the House.
The Bill in question must now receive final approval at the Senate before review by the House. The legislation is hopeful of incentivising a legal sports betting market which will be fully functioning by January 2024. A reality that has been seen in over 30 states across the US already.
Should this legislation be passed, it would allow for up to 6 companies to operate sportsbooks within the state. Subsequently, the new law would enable the creation of a dedicated fund to house revenue and fees collected by the state through its role as market overseer.
Vitally, there will be a portion of the revenue set aside to ensure the creating and accessibility of programs and resources to support problem gambling. In fact much of the legislation is focused on ensuring and encouraging responsible gambling.
The Senate’s re-iteration of the bill maintained the state’s right to 20% of the adjusted gross revenue generated by the sports betting operators annually, however the change comes in the form of alterations to the operating fees.
In the Senate bill, each operator would be subject to a $550,000 fee not more than every 3 years. This varies from the initial proposal as the House bill, operators would be required to pay charges baked on the number of operators in the market. For instance, if there was only one operator $550, 000 would be charged, whereas if there were 6 operations, the fee would calculate at $125, 000 annually.
According to Sen. Thomas Chittenden, who sits on the Senate finance Committee, claims this change was made in order to encourage sportsbooks to keep active operations in Vermont for longer periods. Along with this higher fixed fees, regardless of how many operators, would bring in far more revenue for the states.
An industry of decent proportions is projected to come to fruition in lieu of this legislation. The regulation’s Joint Fiscal Office has projected that a modest revenue of about $2 million in the 2024 fiscal year, could grow to between $4.5 – $10.5 million by 2025. Evening out to an average of $10 million annually.
For comparison, neighbouring Rhode Island with roughly double the Vermont population brings in nearly $50 million annually in gross revenue related to sports betting.
Senators have also agreed to remove any suggestive language directed at a spending cap enforced upon advertising activities. Senators on the Economic Development, Housing and General Affairs Committee deemed this to be too prescriptive.
Wendy Knight, Commissioner of the State Department of Liquor and Lottery, expressed confidence that her agency, the market overseer, could develop stringent and effective guidelines without the use of a monetary cap.
Advertising and targeted marketing would be required by the Bill to be limited when targeted at individuals under the age of 21, who are legally barred from wagering platforms, along with a prohibition on advertising to college campuses.
Fines for operating unlicensed sportsbooks have also been defined, doubling the originally planned fees presented by the House. An initial first offence would stipulate a $50,000 fine, a second reaching $150, 000 and $300, 000 for the third and all subsequent infractions.
Although some provisions in this legislation seem rather stringent, on the whole it seems like a solid base for regulation regarding the sports betting industry to begin. Amendments and alterations are still required and will continue to be necessary depending on the industry’s development.
An early emphasis on responsible gaming is also a very positive factor, providing the revenue to create a strong and efficient infrastructure to protect those at risk of problem gambling, shows a good intent to make sports betting a legitimate and fair sector within the state of Vermont.
SiGMA Americas is coming to Brazil this June. Don’t miss out on what promises to be an extraordinary event, with a wealth of industry leading knowledge, innovative insights and a plentiful plethora of premium networking opportunities.