September 25, 2023

N.C. Budget Proposal Would Shift Power To Teams, Venues


North Carolina’s proposed state budget, which will likely be voted on this week, includes provisions that would impact the state’s mobile sports betting law. 

Previous legislation allows for up to 12 mobile sports betting operators to go live in the Tar Heel State in the first half of 2024. While the projected launch timeline hasn’t been altered, the budget takes out language allowing for the 12 mobile operators, replacing it with language that says the North Carolina Lottery Commission “shall only license interactive sports wagering operators who have a written designation agreement in accordance with G.S. 18C-905.” The news was first reported by WRAL.

Those designated candidates for licensure include professional sports teams, the owner or operator of a motorsports facility, a professional golf tournament venue, a sports governing body that annually sanctions more than one NASCAR national touring race, and a sports governing body that annually sanctions more than one professional golf tournament. 

Essentially, the proposed language gives North Carolina’s professional sports franchises and venues power in choosing the operators who will be allowed to launch in the state. Under the proposed legislative change, each franchise or venue can only partner with one mobile operator. 

Pushback likely

The budget proposal will likely draw pushback from regulated sports betting operators. Previously, the state’s mobile sports betting language allowed operators to apply directly to the lottery commission for licensure and didn’t require partnership with professional teams or specific venues. 

If the budget proposal is approved, sportsbook operators will have to pay franchises and venues to partner with them just to gain access to North Carolina’s mobile wagering market. 

“This is crony capitalism at work. … North Carolina has created scarcity in licenses,” Alex Kane, the CEO and founder of Sporttrade, posted on social media. “They were designed to be direct. Now the leagues will get to control and monetize who gets a license. This would statutorily impose private business as the gatekeepers to tax and control who enters the state.”

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A vote on the proposed state budget is expected later this week. If the revision is approved, the lottery commission would have to alter its course as it prepares to regulate sports wagering in the state. 

The commission has worked behind the scenes to begin drafting regulations, although those have yet to be revealed publicly. It’s unclear how the budget proposal might affect the drafting. 

The budget proposal doesn’t change the projected launch date for mobile sportsbooks, which still falls between Jan. 8 and and June 15 of 2024. The commission is allowed to accept written license agreements prior to Jan. 8.

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