Alabama Committee Wades into Gambling and Sports Betting Bills

Dec 2, 2023; Atlanta, GA, USA; Alabama Crimson Tide quarterback Jalen Milroe (4) runs against the Georgia Bulldogs in the first quarter of the SEC Championship at Mercedes-Benz Stadium. Mandatory Credit: John David Mercer-USA TODAY SportsThe Alabama House Economic Development and Tourism Committee yesterday held a hearing on the proposed expansive gambling billHB 151 and 152 would legalize state casinos, sports betting, and a lottery in AlabamaLegislators predicting it could bring in up to $1.2 billion in new revenue annually

Alabama legislators took the next step with their expansive gambling plan yesterday as representatives held a public hearing on two bills that would legalize casinos, sports betting, and a lottery in the state.

The Alabama House Economic Development and Tourism Committee held a public hearing on HB 151 and 152, which elicited responses from nearly 20 speakers during the 90-minute meeting. Two representatives introduced the bills last week.

If approved, legislators predicted Alabama could see an influx of more than $1.2 billion in new revenue annually.

Concerns Over Expanded Gaming

No official action was taken on the bills during the meeting.

Rep. Chris Blackshear (R-80) and Rep. Andy Whitt (R-6) introduced HB 151 and HB 152 last week. If approved, the bills will legalize up to seven casinos in the state, in-person and online sports betting, and a state lottery to support Alabama education. HB 151 would be the triggering mechanism for the bill, which requires a constitutional amendment be approved by Alabama voters during the 2024 November general election.

Blackshear introduced the legislation before the hearing and explained that Alabama voters would have the final say before anything was legalized.

“It’s been a quarter of a century since the last time the citizens got to express their opinion on this matter in the state of Alabama. Bill Clinton was president. I think the last thing we were worried about in the business industry at the time was that Y2K was going to send us back to the stone age,” Blackshear said during the committee hearing.

Blackshear said fiscal estimates show that legalized gaming, casinos, and lottery through these bills can bring in between $935.6 million to $1.214 billion annually. Sports betting is estimated to bring in between $15 million to $42.5 million annually.

Despite the millions of annual revenue that would be triggered through these bills, a number of citizens and representatives for various groups in the state shared their concerns over the proposed expansion of gaming. Speakers brought up the dangers of gambling addiction, its impact on mental health, and advertising effects on minors.

Vestavia Hills Councilor Kimberly Cook warned the committee that casinos, gaming, and sports betting jeopardize the health, safety, and welfare of her constituents.

“Gambling, drugs, and prostitution thrive in casinos. As addictive as cocaine, gambling drives people to anxiety, depression, and suicide. People who live close to casinos, and that could Vestavia Hills, are most as risk,” she said.

FanDuel President Christian Genetski, an Alabama native, said sports betting is currently happening in the state right now whether people want it to or not. Nearly 2 million attempts to bet on sports were blocked in the state last year, he noted, and residents either chose to cross the border into a neighboring state with legalized sports betting or used an offshore unregulated sportsbook.

Alabama remains stuck with “illegal and unsafe sports betting website that operate offshore, are untaxed, and without any regulation or oversite,” he said.

“We’re committed to ensuring the integrity of sports, that all of our customers play responsibly, and nobody underage can access our platforms,” Genetski said.

Gaming Bill Details

The bills, if approved by a three-fifths majority in both the House and Senate, will establish an Alabama Gaming Commission  to license and regulate the conduct of all sports wagering, charitable gaming activities, lotteries, and casino gaming activities in the state. The bills will also create the Alabama Gaming Enforcement Division, which will include the power to police all gaming activities in the state and “work to eradicate unlawful gaming and gaming-related activities,” the legislators wrote.

Casinos will be taxed at a rate of 24% of net gaming revenue and 95% of total gaming revenue will be allocated to the state’s Gaming Trust Fund every month. A percentage of the revenues will then be distributed among municipalities where the casinos are located.

Casino licenses will be valid for a 15-year term. An extended initial license term could be granted by the gaming commission if the applicant proposes to make a minimum capital investment of $500 million at the proposed site. Casino license fees shall not be less than $5 million.

Sports betting will be taxed at 17% of net gaming revenue, with 90% of the revenue allocated to the Gaming Trust Fund and 10% to be allocated among each county commission to be used “exclusively for law enforcement purposes of the respective sheriff’s department.”

A state education lottery will also be created.