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Vermont legislators cleared a key deadline on Friday (March 24) to allow mobile sports-betting legislation to progress, with some unique language governing advertising included in the bill.
The Vermont House of Representatives approved House Bill 127, just in time for the state’s crossover deadline whereby bills need to clear at least one legislative chamber to remain active in the 2023 session.
The bill would create a legislative model similar to neighboring New Hampshire, with the Department of Liquor and Lottery (DLL) designated to negotiate and contract for up to six mobile sports-betting operators to offer wagering in the state.
Under the bill, applicants would take part in a competitive bidding process and pay a revenue share determined through that process of at least 20 percent of adjusted gross revenue, which includes deduction of federal excise taxes but not promotional play deductions.
Selected companies would also pay an annual operator fee dependent on the number of operators selected during the process, ranging from a $125,000 fee if all six slots are awarded up to a $550,000 fee if only one operator is chosen.
The bill specifies that the DLL should select at least two operators, but also gives the department latitude to select a sole operator if it only finds one to be qualified.
The legislature directs the DLL to prioritize maximizing revenues to the state, converting players from illegal to legal markets, and protecting Vermont residents from problem gambling when conducting the process and reaching agreements with operators.
The bill also includes a unique advertising restriction that requires the lottery department to negotiate an unspecified cap on the amount that can be spent by the department and its contracted operators on sports-betting advertising.
Betting on colleges based in Vermont would be prohibited, and colleges would be barred from allowing sports-betting advertising on college property. In addition, operators would be prohibited from advertising “in a manner that targets the area of a college or university campus.”
The bill also specifies specific fines for compliance violations ranging from up to $25,000 for a first violation, $75,000 for a second violation, and $150,000 for a third violation, as well as authorizing the lottery department to terminate a contract with an operator and revoke the ability to offer sports betting for any violation.
“After taking testimony on how other states’ fine structures weren't sufficient to deter nefarious behavior that is seen as a cost of doing business to some folks, I felt like we needed to escalate (the penalties),” Representative Matt Birong, a Democrat and the bill’s sponsor, said in an interview with local news outlet VTDigger.
The next stop for the bill will be the state’s Senate, with the legislative session scheduled to end May 19.
Should the bill pass both chambers, Vermont Republican Governor Phil Scott is likely to sign it as he included revenue from sports betting in his 2024 proposed budget and has publicly backed sports-betting legalization.
