Colorado could jump on the sports betting bandwagon as early as next May, if a recently introduced bill on the matter gains traction in the state Legislature and voters approve the legalization of sports gambling in the upcoming November vote
Democratic House Majority Leader Alec Garnett and Republican Minority Leader Patrick Neville introduced the bill late on Thursday. The piece of legislation, if passed, would place a sports betting question on the November ballot.
State residents would be asked whether a 10% flat tax on net proceeds from regulated sports gambling should be implemented. The ballot question will be concerned with the taxation of betting services because, under state law, any tax increase must be approved by Colorado voters.
The state’s existing casinos will be able to apply for licenses to operate sports betting online and via mobile apps. The gambling venues will also be allowed to provide limited in-person betting services.
Licensed operators will determine their own limits on bets. Under the proposed provisions of the new sports betting bill, bettors will be able to place wagers on professional and collegiate sporting events, including ones involving Colorado teams.
Revenue Projections and Allocation
As mentioned earlier, licensed operators will be taxed at 10% on annual net proceeds. Asked about early tax revenue projections, Rep. Garnett told FOX31 Denver that “on the low end” regulated betting could generate between $5 million and $10 million in annual tax revenue. On the higher end, tax revenue “plateaus around $20 million”, the legislator dwelt further, hoping that as the market matures, proceeds will grow.
Most of the revenue generated will “go toward conservation and protecting our water”, Rep. Garnett said.
Around $130,000 would be allocated to organizations dealing with problem gambling and gambling addiction. Commenting on the potential regulation of sports betting in Colorado, Problem Gambling Coalition of Colorado President Lawrence Wall said they are glad that part of the projected revenue would be used to support their work.
However, Mr. Wall expressed doubts on whether sports gambling, particularly digital betting, was a good idea. He elaborated further that providing people with the opportunity to place bets from the comfort of their home instead of getting them into casinos to wager would get many bettors into trouble.
Tackling Illegal Gambling
Responding to concerns about the impact of regulated sports betting, Rep. Garnett said that wagering is already conducted across the state illegally, and that their ultimate goal does not involve expanding gambling in the state but bringing an already existing practice to the regulated surface.
Following its introduction this past Thursday, the bill is now set to appear before the House Finance Committee on Monday. Lawmakers are in a rush to pass the legislation before May 3, when this year’s legislative session is scheduled to end, in order to be able to place the betting tax question on the November ballot.
Senators John Cooke and Kerry Donovan are co-sponsoring a Senate version of the sports betting bill.
Colorado is the latest of a plethora of states that have moved to legalize sports betting following last May’s landmark ruling of the US Supreme Court. The nation’s top court lifted a long-standing federal ban on the practice, thus enabling each and every state to legalize and regulate sports gambling, if they feel inclined to do so.
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