Legislation to legalize sports betting at state casinos — pending a favorable U.S. Supreme Court ruling overturning a federal law banning it — advanced to the full House of Delegates Monday after winning approval in House Finance.
Finance Committee members made no significant changes to the bill (Senate Bill 415), after rejecting proposed changes to prohibit wagering on smartphone apps, and to bar wagering on the personal performances of collegiate athletes.
State Lottery officials believe sports betting would be an attractive amenity for the state’s five casinos, which have been squeezed in recent years by competition from casinos in neighboring states.
Paul Barrett, chief accountant for the Lottery Commission, said the goal is to convert a maximum amount of currently illegal sports wagering into legal market, particularly to attract players from the 10 million out-of-state population that are within 90 miles of one of the five casinos.
“We believe 70 percent of our traffic will come from out-of-state,” he said.
John Cavacini, West Virginia Racing Association president, said the casinos hope to replicate the success they had when West Virginia was the first state in the region to legalize casino table games.
“We didn’t have any idea what a success it would be in the beginning, although obviously, competition has hurt us tremendously,” he said, saying it is critical that West Virginia again be “first to market” in the region with sports betting.
“We look at it as a profit center for us, for the state of West Virginia, and eventually, the PEIA fund,” he said.
The Senate amended the legislation to any state profits from sports betting over $15 million a year into a special account to help fund PEIA health insurance for teachers and public employees.
While the Lottery Commission has conservatively estimated profits at about $5 million in the first year of sports betting, a study commissioned by the Lottery estimates that sports betting should grow to a gross of between $182 million to more than $315 million a year, with the state’s 10 percent tax bringing in between $18 million to more than $30 million a year.
Delegate Cindy Frich, R-Monongalia, attempted to amend the bill to prohibit players who register for sports betting at one or more casinos to use a smartphone app to place wagers. Under the law, the players would have to be in West Virginia, although not necessarily at one of the casinos, to place a bet.
Frich said she was concerned the app would encourage problem gambling, and that it could lead to persons under 21 using their parents’ phones to gamble.
However, Lottery counsel Danielle Boyd said she was not aware of any complaints regarding children’s use of the betting app in Nevada or other jurisdictions where sports betting is legal, and said the app would be able to promote responsible gaming, as opposed to the current illegal sports betting market, with features limiting the amounts a player can bet.
The amendment was rejected on a voice vote.
Also rejected was an proposed amendment by Delegate Larry Rowe, D-Kanawha, to limit side bets on whether individual athletes meet certain performance goals to professional sports, saying the wagers would put tremendous pressure on college athletes.
“This is just bad for the athletes and bad for collegiate sports,” he said, citing recent college sports scandals.
Barrett, however, said the side bets are critical to have a competitive sports betting market in the state.
“If we’re going to offer a competitive product, we have to offer this type of play,” he said.
Delegate Ron Walters, R-Kanawha, doubted if any players, collegiate or professional, go into any game thinking about the betting line on how many baskets they’ll make or how many field goals they’ll kick.
The bill goes to full House.
Also Monday, the committee advanced to House Judiciary a proposed constitutional amendment that would give the Legislature control over the judicial branch budget (Senate Joint Resolution 3).
Rowe said he has issues with breaking down aspects of the separation of powers of the branches of government, but said recent reports of exorbitant spending by the state Supreme Court make it difficult to oppose the resolution.
“I have real concerns over the Legislature taking over the judicial budget, but it’s difficult to oppose with what’s been going on in the Supreme Court,” he said.
If two thirds of the members of the House approve the resolution, the referendum on the proposed constitutional amendment will be on the November general election ballot.