Morris, Manning & Martin LLP

01/19/2021 | News release | Distributed by Public on 01/19/2021 15:53

Legal Update

On Thursday, January 15, a bipartisan group of Georgia legislators introduced HB 86, the Georgia Lottery Mobile Sports Wagering Integrity Act, an act to legalize and regulate online professional sports gambling in Georgia. If passed by the General Assembly and signed by the Governor during the current legislative session, Georgians could begin to place wagers on professional sporting events online as soon as July 2021.

The legislation proposes that all online gambling be regulated and supervised by the Georgia Lottery Corporation (GLC) pursuant to its current powers under O.C.G.A. § 50-27-9. The Act's sponsors' choice to grant to the GLC the authority to regulate and supervise online gaming in Georgia is made in furtherance of its aim to legalize a limited form of gambling without needing to amend the State Constitution and/or hold a public referendum on the matter. The drafters' decision to include online sports betting as part of the GLC's mission also means that the 'net proceeds' of taxes collected from the sports wagering operators will be used to supplement current GLC net proceeds and to 'support improvements and enhancements for educational purposes and programs.' Per the bill, sports wagering operators will be taxed at a rate of sixteen percent (16%) of adjusted gross income.

If the legislation is passed, potential operators will have to submit applications to the GLC, who will be tasked with reviewing applications and awarded licenses to operate online sports wagering platforms. The legislation instructs the GLC that it must issue no fewer than six licenses to qualified applicants, assuming at least six such applicants apply for a license. The legislation does not apply a cap on the number of licenses the GLC may award.

In addition to boasting bipartisan support in the Georgia General Assembly, the legislation has the support of pivotal House leadership figures such as the: Chairman of the House Economic Development & Tourism Committee, Minority Caucus Chairman, Chairman of the House Budget & Fiscal Affairs Oversight Committee, Chairman of the House Working Group on Creative Arts & Entertainment, and members of the House Appropriations Committee. Outside of government, the legislation also has the full support of all of Atlanta's major professional sports franchises; the Braves, Hawks, Falcons, and Atlanta United have all voiced support via the Georgia Professional Sports Integrity Alliance. The legislation is expected to pass both chambers of the General Assembly; to date the Governor has not commented on this bill, but has previously indicated opposition to in-person gambling in Georgia.

Lastly, the legislation explicitly bans wagering on amateur events, including high school and collegiate sports. The legislation does allow for wagering types beyond traditional game spread or money line bets to include teasers, parlays, and prop bets of all stripes.

Nick Foreste is a partner in Morris, Manning & Martin's Corporate Practice and focuses on servicing emerging technology start-up ventures. Josh Kirschner is a member of Morris, Manning & Martin, LLP's White Collar Defense and Hospitality practices with a focus on healthcare and financial fraud and abuse. If you have any questions or wish to learn more about submitting a future application to operate an online sports wagering platform in Georgia, please contact Nick or Josh.