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The vote was conducted Tuesday during the Senate’s scheduled session. The bill now moves to the House of Delegates.
Sen. Craig Blair, the Senate Finance Committee’s chair, presented his analysis of the bill to open the meeting. About 45 minutes of arguments followed, with senators interrogating committee members over the details.
The bill was then passed by a 25-9 vote.
The Senate’s bill will now be handed to the House for its consideration. It appears that the bill will go straight to the House Finance committee, where action could come quickly. That committee held a discussion on the bill on Monday.
Del. Shawn Fluharty has been pushing his own sports betting bill since last year.
If approved by the full House — that could come as soon as this week — the bill would head to the governor’s desk for approval.
Here’s what it does:
During the session, Sens. Corey Palumbo and Michael Romano provided the primary voices of concern.
Sen. Palumbo expressed skepticism regarding the bill’s constitutionality. West Virginia statutes contain language that prohibits “lotteries or gift enterprises.” That language has since been amended through voter referendum, including the carveout for slot machines that turned race tracks into racinos.
Sen. Charles Trump, who chairs the Judiciary Committee, offered his opinion that the sports betting bill is constitutional under its intent. “I don’t think the constitution prohibited outright gambling,” he said.
Trump suggested that the lottery clause carries a narrow interpretation that excludes things like table games and sports betting. He cited a 1991 Attorney General opinion that concurs based on the predominant element of skill involved.
Palumbo pressed again, and Trump reaffirmed the Judiciary’s stance: “I don’t think sports betting is lottery. And I don’t think it’s prohibited by the constitution, if you call it lottery or if you don’t.”
Romano noted that the proposed tax rates and $100,000 licensing fee are cheap by some comparisons.
Pennsylvania, for example, will charge $10 million for the privilege and tax it at an effective rate of 36 percent. That PA sports betting law is turning out to be a bit of a disservice to its neighbors. Romano is using those exceptionally high rates as ammunition against WV’s more manageable numbers. West Virginia is setting up its sportsbooks to compete with the existing black market, while PA is not.
He also spent a fair amount of time conflating handle and revenue, a constant source of frustration for those pushing legislation. “I am a no vote on this, sir,” Romano finished.
Sen. Douglas Facemire echoed the thought that the state needs to be a better negotiator in this deal. It will, after all, have a monopoly on the legal WV sports betting industry. “I think we should be keeping it all,” he said.
The state projects to receive about $5 million in revenue from sports betting within the first year. But Facemire argues that it’s not enough. “If $5 million is the best we can get, I’m not sure the gain is worth the risk.”
Blair correctly interjected at one point with arguments that aggressive taxation would likely make it difficult to compete with offshore sportsbooks illegally serving West Virginians.
Sen. Michael Woelfel expressed the most vocal support for the bill. His arguments were well laid-out.
“You also have to remember this would could bring a fair amount of jobs,” he said. “And I see us capturing activity that’s already going on in our state and capturing tax revenue that’s going to be spent for good reasons.”
Woelfel also suggested that the $5 million in first-year revenue is probably a conservative estimate.
“Based on my research, the five million is about half of what it’s going to be the first year,” he said. “I think it’s going to be closer to nine or ten. And I’ll bet on it.”
Image credit: Nagel Photography / Shutterstock.com