A sports betting bill in Vermont is gaining increasing momentum in the Senate, where it recently scaled through the Senate Economic, Development, Housing and General Affairs Committee. The bill, HB127, was introduced in January by seven Democrats and three Republican sponsors, with the aim of legalizing digital-only sports wagering.
Despite significant legal progress made in other states, Vermont has neither legalized commercial or tribal casino gambling nor does it allow pari-mutuel wagering. However, in March, after an unprecedented course of events, the bill cleared the House of Representatives after a voice vote. This marked the first time ever that a proposed sports betting legislation gained approval in any of Vermont’s legislative chambers.
As is a customary procedure, the bill moved to the Senate, where the Economic, Development, Housing and General Affairs Committee had a first shot at deliberation. The bill advanced after a very convincing 4-1 vote in its favor but with several major amendments. Most importantly, the committee expressed its unwavering resolve to enforce responsible gambling practices.
The amended proposal advised banning sportsbooks from promotional activities or adverts at events where a majority of the attendees are below age 21. All sports betting operators will also be required to pay a 5% tax on revenue, which will be used to establish a problem gambling fund.
In addition, the bill recommends that the Department of Mental Health receive $250,000 and $500,000 in 2024 and 2025, respectively. This annual allocation will be directed toward establishing and administering a problem gambling program.
Finally, sports betting operators will submit regularly updated plans detailing their approach to prevent advertisements from reaching underage audiences while also promoting responsible gambling programs.
Senate Finance Committee Stalls on Deliberation
After a short time at the Senate Economic, Development, Housing, and General Affairs Committee, the bill is now at the Senate Finance Committee. The Committee deliberated on the bill for the first time on Tuesday, April 18, to consider the potential economic implications of sports betting.
Tucker Anderson, an official in the Office of Legislative Counsel, led members of the committee through the important sections of the proposed bill. In particular, he emphasized the operative framework for sports betting in the state, which permitted up to six digital sportsbooks in the state.
Later, on April 19, representatives from Orrick, Herrington & Sutcliffe LLP advised on the legal aspects of the bill, while the Department of Liquor and Lottery also provided expert opinions.
The Senate Finance Committee has since adjourned its meeting and is expected to converge again soon for a vote. Should the bill scale through the Finance Committee, it would move on to the floor of the Senate for a final vote.
With only the Senate passage of the bill and assent from the Governor culminating the final steps, Vermont is very close to legalizing sports betting. It could well become the last New England state and the second US state in 2023 to legalize digital wagering. Vermont would also join Tennessee as the only other state with solely digital wagering but no in-person sportsbooks.
Revenue Projection for Vermont Sports Betting Appears Positive
Despite being the second smallest state in the US by population, there’s no denying the economic potential of sports betting in Vermont. According to the bill, a maximum of six sportsbooks are allowed. Interestingly, the number of sportsbooks operative in the state determines the licensing fee applicable.
All six platforms going live in the first year will set the licensing fee to $320,833 per sportsbook. However, the fee increases to $412,000 per annum if only two operators are functional in the state.
The Department of Liquor and Lottery is expected to develop a revenue-sharing model with sportsbook operators. However, there is a minimum revenue share percentage of 20% required from the adjusted gross revenue of sportsbooks.
