Virginia currently only allows college sports betting on out-of-state teams, but that could change under a unique model proposed by a new bill.
Del. Garrett McGuire’s HB 1527 would amend state law to legalize wagers on NCAA Division I Virginia college teams while taxing operators at 50% of the gross revenue they make on those bets. That in-state college sport-specific tax rate would be more than triple the state’s current 15% tax rate on online sports betting, and would be implemented on in-state college sports bets instead of the 15% rate.
The bill has been introduced but is still awaiting a referral to a committee for discussion.
Tax revenue would go straight to Virginia college athletics
The push to expand but heavily tax Virginia college betting comes at a time when the NCAA and some other stakeholders continue to push for more restrictions on wagering on NCAA events. Several states have approved bans on player prop bets for college sports over the last couple of years. Efforts to limit college player props are on the legislative agenda in states such as New Jersey and Washington this year.
It’s worth noting that Virginia already bans college player props. HB 1527 suggests that the prohibition would remain in place even if this bil were passed, meaning that Virginia residents would be able bet on games featuring in-state college teams,
The bill also specifies that every single dollar of the revenue from that 50% tax would go towards a to-be-established NCAA Division I Sports Betting Fund and be used for the sole purpose of supporting Division I college and university athletic programs in the state.
Each program would get a share of the revenue directly proportionate to the amount of money it generates for the fund.
Meanwhile, the bill would also double the percentage of revenue from the general 15% tax rate on sports betting that goes into a specific problem gambling support fund, from 2.5% to 5%. The remaining bulk of that revenue goes into the state general fund.
Change would only happen if Gaming Commission legislation passes
Another notable provision states that, even if the bill passed the legislature, its changes would only become effective if the state passes and enacts legislation to establish a Virginia Gaming Commission or other similar agency for the purposes of overseeing gaming in the state. If such a bill did pass, this college sports betting act would become effective in accordance with the provisions of the other legislation.
Other gambling bills in Virginia this year, such as a push to legalize online casino, also have a provision that makes them contingent on a new consolidated gambling regulator being created. Regulation of gambling in Virginia is currently split between several entities; the Virginia Lottery oversees casinos and sports betting, the Virginia Racing Commission regulates horse racing gambling and the Virginia Department of Agriculture and Consumer Services is in charge of daily fantasy sports.
Multiple bills to establish a gaming commission are currently moving through the Virginia legislature. Two separate Senate bills have been combined, with SB 558 rolled into SB 195. That legislation was unanimously approved by a 15-0 vote in the General Laws and Technology committee on Jan. 28 and referred to Finance and Appropriations.
Meanwhile, a House version, HB 271, currently sits with the Gaming subcommittee of General Laws.
