Sports betting and other legalized gambling could beat long odds after Georgia Legislature shakeup

Georgia State Capitol on mostly sunny day

by Ray Glier, Georgia Recorder [This article first appeared in the Georgia Recorder, republished with permission]

January 3, 2023

State Rep. Ron Stephens, a Savannah Republican, wanted to make a point about gambling in the state of Georgia. During a 2021 hearing on legalized sports gambling, he walked to the well of the house and said he was filing a bill to outlaw all gambling in the state. He asked members to come up and sign the bill.

His bill, Stephens said, would have instantly meant the end of the Hope Scholarship.

“Not a single person came up,” said Stephens, who is the chairman of the House Economic Development and Tourism Committee. “If anyone did sign it, it would have been their political death wish. They would have been booted out of office with both feet.”

Stephens said it is about time that gambling that is allowed in the state — the lottery — is expanded to include sports gambling, with additional measures to allow horse racing and casinos. He said he has never been more confident the Legislature will vote in the session that begins in January to have a constitutional amendment on the ballot in 2024.

“We walk away from $100 million every year in sports gambling, and other states, and places like Antigua, get that money from people here in Georgia,” Stephens said. “Let’s regulate it, tax it, and put the money in Hope and pre-K.”

Gambling legislation could also find a friendlier audience in the state Senate this year. Lt. Gov.-elect Burt Jones, a Jackson Republican, sponsored sports betting bills as a state senator in the chamber he will soon preside over. Jones tapped state Sen. Brandon Beach, an Alpharetta Republican who routinely supports expanding legalized gambling in Georgia, to serve on the Senate’s influential Committee on Assignments.

Stephens said gaming legislation will require two bills before Georgia voters would get a final say. One bill would require a constitutional amendment to allow sports gambling, horse racing, and casinos and the second to lay out exactly how the revenue will be spent. Stephens said it would be up to local governments to determine whether they want to have an equestrian enterprise and “destination resorts,” which typically feature casinos.

“There’s an appetite for equestrian horse racing and the whole equestrian market, if the local folks are allowed to vote, and I believe they will,” Stephens said. “Then, at some later date, come back with that question of destination resorts (casinos) when the time is right.”

In 2022, a sports gambling bill passed out of the Senate, survived a vote out of the committee, but died in the gate-keeping rules committee, Stephens said.

State Sen. Elena Parent, a Decatur Democrat, said sports betting is already being done by many people across the state. Legalizing it and “building out a framework,” Parent said, will allow the state to collect tax dollars and “see a reciprocal benefit.”

But the idea of pairing casinos with sports betting legislation muddies the whole issue, she said.

“It is not a slam dunk, because there are many who would also like to see casino gambling legalized at the same time (as sports betting), which has more opposition,” Parent wrote in an email.

Stephens said he is willing to roll the dice, so to speak, and allow local governments to make that call. If their citizens want horse racing and casinos, so be it. If not, it does not go anywhere. The constitutional amendment does not force casinos or race tracks on any city or town, he said.

Opponents of casinos insist it is one more regressive tax on poorer Georgians, who play the games to relieve endemic poverty. Many also say the lottery-funded Hope Scholarship proceeds increasingly go to higher-wealth families who can afford tutors and better schools and consume much of the merit-based Hope money.

In May, 2018, the U.S. Supreme Court opened the spigot to the $165 billion U.S. sports betting industry by allowing states to legalize online sports gambling as legislatures pressed for ways to close budget gaps.

Revenue from taxes from on-line betting has flowed into the treasuries of 22 states, including neighbor Tennessee, which has made approximately $74 million in sports betting tax revenue since November 2020.

However, neighboring South Carolina, Alabama, and Florida do not regulate online betting.

According to a statewide poll conducted by the School of Public and International Affairs Survey Research Center at the University of Georgia, 45.6% of likely voters surveyed favored making online betting on professional sports legal in the state and 42.6% opposed with 11.8 answering “don’t know.”

Considering the slim margin of the poll is Stephens reading the room accurately?

On the question of casino gambling in Georgia, 59.7% support, 29.1% oppose, and 11.3% answered “don’t know.”

In her run for governor, Stacey Abrams supported legalized sports betting to pay for the rising costs of education.

Gov. Brian Kemp opposed legalizing sports gambling in 2018. He offered no public position on the issue during the gubernatorial race with Abrams in the fall.

However, it does not appear Kemp will stand in the way of a constitutional amendment. “To be able to do that (gambling) here, it’s gonna take a constitutional amendment. It doesn’t really matter what the governor thinks, you can’t veto a constitutional amendment,” he told reporters in August.

Stephens said the lottery and the funding of Hope and pre-K have become a “sacred cow.” Communities want it supported, but funding has been reduced because Hope is so popular.

“The make-up of the people (voters) who send us here is why we need this,” he said. “We have 3.6 million families that have been touched with Hope and pre-K and they want the opportunity to continue to support Hope and pre- K. All the gaming revenues that we’ve done for the past two and a half decades have supported Hope and pre-K.

“Those folks have now grown up, they’ve got children of their own, and they want the programs fully funded again.”

The opponents of horse racing and pari-mutuel betting, which include the Georgia Baptist Convention and its 1.3 million members, claim that race tracks in Georgia will eventually give way to slot machines and gaming tables inside the race track. Gambling addiction and broken families will follow, they say.

Stephens insists rural Georgia would benefit greatly from a robust equine industry. He said the business of horses, whether show horses or thoroughbreds, can boost job growth that is lagging behind urban areas of the state.

Thoroughbred sales in Florida annually are about $156 million, according to a 2017 study by Florida Thoroughbred Breeders’ and Owners’ Association. There are 100,000 thoroughbreds in the state and the direct thoroughbred industry impact is $1.5 billion, according to the trade group. The industry says there are 23,000 jobs in the state related to thoroughbred racing.

The jobs include hot walkers, grooms, jockeys, fence installers, barn painters, veterinarians, blacksmiths, leather smiths, feed and hay dealers, tack repair, horse transport trucks, maintenance workers, and the list goes on.

“The equine industry fits so well with the governor’s initiative of workforce development,” Stephens said. “That’s his big deal coming up this entire term. The unemployment rate in rural Georgia is not very good, even though the state is in full employment.

“We’ve got folks that would like to stay in their hometowns, but there’s no industry there to support them.”

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