Taking odds: How legalized sports gambling can impact business in Georgia

Massive budget cuts are coming.

The Georgia Legislative session resumes on June 15 and one of the topics that may be revisited is sports gambling. Lawmakers may be willing to give casinos and mobile sports betting a second look after legislation fell through before the session was suspended due to Covid-19.

The economic fallout of the virus is already being felt and lawmakers could be more motivated now to pass sports gambling bills to avoid revenue going elsewhere to neighboring states.

“We need to pass that in Georgia to capture that revenue,” said Chris Clark, president and CEO of the Georgia Chamber of Commerce. “Now more than ever with the state’s resources down 10%, here’s a pot of money that could help educators, healthcare (workers) and keep us from raising taxes at the local and state level maybe.”

Clark believes businesses could benefit from the potential tax base expansion. Some Georgia-based companies may even consider even setting up an operation to manage a sportsbook.

“We don’t how big that economic impact would be, but the bigger discussion is capturing those tax revenues and keeping those dollars in the state,” he said.

Gov. Brian Kemp has already told state agencies to brace for 14% budget cuts to mitigate the financial damages caused by the pandemic. Lawmakers could give sports betting another look in a time where finding new revenue streams could help recover from the recent economic losses.

Two different gambling bills remain on the table, even though they failed to make the Crossover Day cut.

mobile sports betting bill (SB 403) would legalize online betting under the Georgia Lottery Corporation and could generate over $40 million in annual revenue for the state, supporters say. The bill is backed by the Atlanta Hawks, United, Falcons and Braves through a coalition called the Georgia Professional Sports Integrity Alliance.

The bill stalled in the Senate though, despite high-profile support from top sports executives.

“The legislation is still alive, whether they’ll be an opportunity to move it forward in the remaining days of the session remains to be seen,” said Billy Linville of the Georgia Professional Sports Integrity Alliance. “But we’re optimistic because this provides much needed revenue in 2021 and the enhancement of sports teams are now more important than ever.”

Another bill (HB 570) — which includes three forms of wagering: casinos, sports betting and pari-mutuel betting on horse racing and sports betting — may be more of a viable option given the estimated amount of jobs it would generate. Rep. Ron Stephens (R-Savannah), who filed the bill, said ‘tens of thousands’ of jobs would be created at destination resorts and horse racing tracks as well as thousands of temporary constructions jobs to build the new facilities.

“Some of these businesses, especially in Savannah and Atlanta, aren’t going to be coming back,” Stephens said. “Even though the jobs number is looking better for those that can come back, there’s small businesses that won’t. We have an opportunity to fill the hole — in every different way, whether it’s in jobs, (tax) revenue, HOPE Scholarship or Pre-K funding.”

Polls have shown that the majority of the state’s registered voters would say yes to legalize sports gambling if it were on ballot in November. But there remains a fair amount of opposition from religious groups and others who believe gambling is immorally wrong and breeds crime.

Mike Griffin, the public affairs representative for the Georgia Baptist Mission Board, thinks that the potential revenue earned from legalized wagering won’t be an economic home run anyway.

“For every dollar raised in tax revenue, it’s going to end up costing an additional three dollars in social expense,” Griffin said. “You don’t have to be the sharpest spoon in the drawer to know that doesn’t work out right. People will make a lot of money at it but (wagering) typically has a blowback over the long haul and isn’t something that’s going to be positive.”

Some city officials though are trying to bring casinos and horse racing into their communities. The city council in Hampton, Ga. earlier this year adopted a resolution in support of citizens voting on the bill which would require a constitutional amendment by statewide referendum.

Ed Clark, who recently retired as president of Atlanta Motor Speedway, proposed building a casino and destination resort last fall near the racetrack in Hampton, Ga. Clark estimates the facility he’s proposing would create about 5,000 part and full-time jobs if the bill is approved.

“This is something that we want to do,” Clark said. “This is something that we have the ability to do, with a partner (Foxwoods Resort Casino) that’s involved in the industry. We’ve been very forthright about our interest in it, but that all depends on the parameters that are set up.”

Other sites in Georgia in Augusta, Hartwell and Liberty County have also been proposed.

“The guys sitting under the Gold Dome are getting ready to cut thousands of jobs from Georgia’s payroll and reduce the salaries of thousands more,” said City Commercial Real Estate founder Rick Lackey. “If there was ever a time to make some money, I think now would be a good time.”

For years, legalized gambling supporters in Georgia have tried to get legislation passed but to no avail. It’s uncertain how much attention it will receive when the session resumes next week, despite the need for more tax revenue. Lawmakers will already have the tough task of finalizing a 2021 budget while maneuvering the Covid-19 safety guidelines set at the state capitol.

Stephens knows it’ll take a leap of faith for lawmakers to pass his sports betting bill. He points to the film tax credit legislation that he filed back in 2008 in the midst of the recession. That bill too faced opposition but has now contributed over $4 billion in economic impact for Georgia.

“We don’t have any other source or way to get jobs, revenue and prosperity back in the state,” he said. “This is the way and the people want it.”

By   – Sports Business Reporter, Atlanta Business Chronicle

 
https://www.bizjournals.com/atlanta/news/2020/06/11/gambling-georgia-sports-casino.html

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