76.9 F
Mobile
82.7 F
Huntsville
82 F
Birmingham
84.8 F
Montgomery

Comparing House and Senate versions of the 2024 Alabama legal gaming bills

UPDATED 6:05 p.m. — All six members of the Alabama House and Senate conference committee reached an agreement on the distinct versions of the legal gambling framework [READ MORE]

On Tuesday, a conference committee comprised of three members of the Alabama House and three members of the Alabama Senate will meet at 3 p.m. to deliberate the version of the legal gaming package passed by the House in February and the legal gambling bill passed by the Senate in March.

Major changes were made to the two-bill proposal by Senators during that process, and House members voted to non-concur with them earlier this month, formally sending the 2024 legal gaming package to the conference committee meeting today.

Here’s a detailed breakdown of the versions passed by each chamber:

Constitutional Amendment (HB151)

Alabama House

Authorizes the Legislature to provide for the following gaming activities:

(1) A state lottery played using paper tickets.
(2) In-person casino-style games.
(3) Sports wagering.
(4) Traditional raffles.
(5) Traditional bingo

  • Commission may award up to seven licenses to conduct in-person casino-style gaming activities. Local approval requirement. Locations subject to requirements of general law.
  • Legislature may authorize a form of gaming activity not specifically authorized, or may increase or decrease the rate of taxation on such activity, only by three-fifths vote and recommendation from the gaming commission.
  • Gaming Commission established; enforcement division established within the commission.
  • Lottery Corporation authorized to be established to operate and administer the lottery.
  • Net proceeds from lottery and gaming activities provided for by general law.
  • Tax on gaming revenues at a rate established by general law; provided, the increase or decrease the rate of taxation on such activity, only by three-fifths vote and recommendation from the gaming commission.
  • Distribution of tax revenue provided by general law.
  • State income tax on winnings pursuant to normal income tax withholding procedures.
  • Governor shall negotiate and may execute a compact with PCI. In return for the consideration in the compact, PCI shall be granted a license to conduct casino-style games at a site outside of trust lands. This license is one of the seven authorized to be issued.
  • State income tax on winnings pursuant to normal income tax withholding procedures.
  • Governor shall negotiate and may execute a compact with PCI. In return for the consideration in the compact, PCI shall be granted a license to conduct casino-style games at a site outside of trust lands. This license is one of the seven authorized to be issued.
  • Future local CAs authorizing any form of gaming activity are prohibited.
  • By general law, the Legislature may grant original jurisdiction to any court in the state to hear matters in which the Gaming Commission is named a party.
  • Local CAs repealed (effective on ratification). Existing locations operating pursuant to a local CA are authorized to continue until January 1, 2027, subject to certain requirements.

Alabama Senate

Authorizes the Legislature to provide for the following gaming activities:

(1) A state lottery played using paper tickets.
(2) Pari-mutuel wagering on horse races, dog races, and historical horse racing computerized machines.
(3) Traditional raffles.
(4) Traditional bingo.

(No sports wagering; no other casino-style games).

Pari-mutuel wagering limited to the following seven locations in existence as of October 1, 2023:

(1) At each of the four racetracks in Greene, Jefferson, Macon, and Mobile Counties.
(2) At an additional existing location in Greene County.
(3) At one existing location in Houston County.
(4) At one existing location in Lowndes County.

No other form of gaming activity may be authorized except by statewide constitutional amendment.

  • Gambling Commission established; enforcement division established within the commission.
  • Gambling Commission to operate and administer the lottery.
  • Net proceeds to pay for lottery prizes.
  • Gambling Commission operating expenses subject to receipt of appropriation pursuant to the Budget Management Act.

Remaining funds appropriated through independent supplemental appropriation:

(1) One-third to fund education-related activities.
(2) One-third to fund non-education, general governmental activities.
(3) One-third to the Department of Transportation for transportation infrastructure improvement.

  • Tax on net gambling revenues of pari-mutuel wagering activities set at a rate of between 20 and 28 percent. Rate set by the Gambling Commission.

Distribution of tax revenue:

(1) 94% to Gambling Proceeds Fund.
(2) 3% to each county where pari-mutuel wagering is conducted.
(3) 3% to each municipality where pari- mutuel wagering is conducted (reverts to county if outside police jurisdiction).

  • In lieu of state income tax owed on the winnings, a withholdings tax of seven percent on any winnings that exceed $500 shall be withheld and credited to the Gambling Proceeds Fund.
  • Governor shall negotiate and may execute a compact with PCI. Governor does not have authority to authorize PCI to conduct gambling activities outside of trust lands held by the United States as of February 6, 2024.
  • Future local CAs authorizing any form of gambling activity are prohibited.
  • By general law, the Legislature may grant original jurisdiction to any court in the state to hear matters in which the Gambling Commission is named a party.
  • Local CAs repealed (effective September 30, 2025).

Enabling Legislation (HB152)

Alabama House

Alabama Gaming Commission

  • Created as an executive branch agency to license and regulate sports wagering, casino-style gaming, and charitable gaming, to supervise the Lottery Corporation, and to supervise the Enforcement Division.
  • Commission membership: Four appointments by Governor; 2 appointments by Speaker of the House (one from a list of nominees from the Minority Leader); 2 appointments by the President Pro Tempore of the Senate (one from a list of nominees from the Minority Leader); 1 appointment by the Lieutenant Governor.
  • Initial appointments must be made no later than July 1, 2024. Appointees serve immediately and continue to serve until confirmed or rejected by the Senate. Appointees continue to serve until the member’s successor is appointed and confirmed by the Senate or 18 months following the expiration of the appointee’s term.
  • Organization meeting no later than October 1, 2024.
  • Subject to Open Meetings Act — Exception: Members may participate electronically for all intents and purposes.
  • Day-to-day affairs managed by executive director appointed by the commission.
  • Minority business participation language included.

Gaming Enforcement Division

  • Created to eradicate any unlawful gaming activity or unlawful gaming-related activity in the state.
  • Has independent primary authority to investigate violations of the gaming laws and rules of the commission.
  • Managed by the Gaming Enforcement Officer, appointed by the executive director of the commission.

Casino-style Gaming Activities

(1) Seven licenses may be awarded. One license may be awarded in each of the following counties:

  • Greene County.
  • In the portion of the City of Birmingham that is within Jefferson County.
  • Macon County.
  • Mobile County.
  • Northeast PCI compact location.
  • Houston County.
  • Lowndes County.

(2) Licenses awarded pursuant to a competitive bidding process which includes:

  • Proposed capital investment in the location.
  • Existing or past investments in the jurisdiction and the state.
  • Past paid taxes to the state/jurisdiction.
  • Experience.
  • Familiarity with local market.
  • Maximum license fee.

(3) Preservation of the historical minority diversity of ownership.
(4) Local approval of gaming establishments required.
(5) Minimum capital investment of $35 million.
(6) Licenses for a 15-year term. Term may be extended if applicant proposes a $500 million investment. License fee for a minimum of $5 million, to be determined by the commission.
(7) One-half of license fee to be paid up front; the remaining portion to be paid in equal monthly installments.
(8) Suitability requirements—includes language prohibiting a monopoly.
(9) No timeline for granting licenses.
(10) Renewal of License—Shall be eligible for renewal by continuing to meet suitability requirements and paying all applicable taxes.
(11) Commission must pre-approve any proposed license transfer or transfer of ownership.
(12) Gaming service providers required to be licensed by commission.
(13) Judicial challenge of license award by unsuccessful license applicant—prohibited.
(14) General operational requirements of licensees, provided.
(15) No advertising restrictions on casinos.
(16) No special withholding tax on casino winnings.
(17) License fees and taxes received from PCI Northeast location treated same as other gaming license fees and taxes. Monies= received pursuant to Tribal-State

Sports Wagering

(1) Application for license.
(2) License fee for an amount and term of years to be determined by the commission.
(3) Online sports wagering license—License to conduct sports wagering through individually branded sports wagering platforms and through associated mobile applications.
(4) In-person sports wagering license—License to conduct sports wagering on the premises of a licensed gaming establishment.
(5) Temporary sports wagering permit— Permit to conduct live, in-person sports wagering at a racetrack for three consecutive calendar days.

Charitable Games

(1) Permit to conduct traditional raffles or traditional bingo for charity fundraising.
(2) $25 permit fee
(3) Violation of requirements a Class C misdemeanor.

Social Gaming

No tax or license requirement for games meeting all applicable requirements.

Lottery

(1) Lottery operated by Alabama Lottery Corporation, subject to regulation by the Gaming Commission.
(2) Managed by a board appointed by the Governor.
(3) Board appoints president to manage the day-to-day affairs of the corporation.
(4) Meetings—Subject to Open Meetings Act, except members may participate electronically for all intents and purposes.
(5) Procurement—exemption for the procurement of lottery equipment, tickets, and related materials.
(6) Advertising—corporation may enter into one or more commercial advertising contracts for the purpose of promoting the lottery subject to rules of the commission.
(7) Withholdings tax—proceeds of lottery  prize of $600 or more subject to income tax  withholding laws.
(8) Restrictions on the selection of lottery  retailers.
(9) Compensation of lottery retailers—7  percent of the sales of lottery tickets sold by  the lottery retailer.
(10) Sales to minors prohibited—May not sell  to individuals under 18 years of age.
(11) Funding:

  • Corporation shall first pay for its reasonable operating expenses (to be determined by the corporation).
  • Second, for the payment of prize money.
  • Third, all remaining funds distributed to the Lottery for Education Fund.

(12) Distribution of Lottery for Education Funds—through an annual supplemental appropriation bill as follows:

  • Problem Gaming.
  • Last-dollar postsecondary scholarship program for public two-year community and technical colleges.
  • Dual enrollment costs.
  • Local boards of education, for capital expenditures and security purposes.
  • Research funding for 4-year colleges.

Alabama Senate 

Alabama Gambling Commission

(1) Created as an executive branch agency to administer and conduct the State Lottery, to supervise the Enforcement Division, and to license and regulate pari-mutuel wagering and charitable games.
(2) Commission membership: Four appointments by Governor; 2 appointments by Speaker of the House (one from a list of nominees from the Minority Leader); 2 appointments by the President Pro Tempore of the Senate (one from a list of nominees from the Minority Leader); 1 appointment by the Lieutenant Governor. (Same as House version).
(3) Initial appointments made after ratification of HB151. Appointees may not serve until confirmed by the Senate.
(4) Initial meeting upon the call of the Governor (following confirmation by the Senate of each appointee).
(5) Subject to Open Meetings Act (no exceptions).
(6) Day-to-day affairs managed by executive director appointed by the commission.
(7) No minority business participation language. May not be applicable in this version.

Gambling Enforcement Division

(1) Created to eradicate any unlawful gambling activity or unlawful gambling-related activity in the state.
(2) Has independent primary authority to investigate violations of the gambling laws and rules of the commission.
(3) Has concurrent jurisdiction over violations of non-gambling laws committed on the premises of a pari-mutuel wagering establishment.
(4) Managed by the Gaming Enforcement Officer, appointed by the executive director of the commission.

Pari-Mutuel Wagering Activities

(1) Number of licenses and locations provided for in constitutional amendment.

  • Applicants must operate an existing facility of not less than 40,000 sq ft as of February 6, 2024.
  • Applicants must either be an existing racetrack or have conducted pari-mutuel wagering or bingo activities for not less than three years in the appliable county/municipality.
  • Must be a U.S. citizen, in good standing with Department of Revenue, and submits its financial records.

(2) No competitive bidding process. Licenses awarded to existing operators.
(3) Historical minority diversity of ownership requirements not applicable.
(4) Local approval requirements not applicable in light of existing facilities being licensed.
(5) No minimum capital investment requirement.
(6) Licenses for a 15-year term. License fee for a minimum of $5 million and a maximum of $10 million.
(7) Entire license fee to be paid in equal monthly installments.
(8) Suitability requirements. No monopoly language.
(9) License applications must be granted or denied within 60 days of submission of a complete application and a finding that the applicant is suitable.
(10) Renewal of License—Shall be eligible for renewal by continuing to meet suitability
requirements and paying all applicable taxes.
(11) Commission must pre-approve any proposed license transfer or transfer of ownership.
(12) Gambling service providers not included.
(13) No prohibition on the judicial challenge of a license by unsuccessful applicant.
(14) General operational requirements of licensees.
(15) Advertising restrictions prohibiting advertising to minors, prohibiting advertising depicting certain images, and subject to regulations regulating signage location and media/forums where it may be posted.
(16) Withholding tax on pari-mutuel wagering winnings of $500 or more.
(17) Alabama Gambling Compact Trust Fund. Receives all revenues to the state generated as a result of the Tribal State Compact contemplated in the proposed constitutional amendment. Monies in fund distributed through an annual appropriation bill in the same manner as the annual State General Fund appropriation bill for non-recurring capital improvement projects.

No Sports Wagering

Charitable Games (Same as House)

(1) Permit to conduct traditional raffles or traditional bingo for charity fundraising.
(2) $25 permit fee
(3) Violation of requirements a Class C misdemeanor.

Social Gambling

(1) No tax or license requirement for games meeting all applicable requirements.
(2) Coin-operated amusement machines are deemed social gaming exempt from licensure.

Lottery

(1) Operated by the Gambling Commission (No Lottery Corporation)
(2) Managed by the board of directors of the Gambling Commission.
(3) Board appoints executive director to manage the day-to-day affairs of the commission.
(4) Meetings—Subject to Open Meetings Act (no exceptions).(5) Procurement—no exceptions; subject to rules adopted by commission and general law.
(6) Advertising—Commission may enter into commercial advertising contracts, except:

  • Advertising may not have a strong appeal to minors.
  • Advertising may not depict individuals purporting to have won or depict images of U.S. currency.
  • Commission may only expend advertising funds to the extent required to participate in a multi-jurisdiction lottery.
  • Commission shall adopt rules establishing restrictions and requirements for signage and forums where advertising may occur.

(7) Proceeds of lottery prize $500 or more subject to special withholdings tax established in HB151 CA. All proceeds of tax to Gambling Proceeds Fund.
(8) Restrictions on the selection of lottery retailers.
(9) Compensation of lottery retailers—7 percent of the sales of lottery tickets sold by the lottery retailer.
(10) Sales to minors prohibited—may not sell to individuals under 18 years of age.
(11) Funding. Provided in CA.
(12) Distribution of Lottery Funds. Provided in CA.

State Tax
(1) Accompanying CA provides commission with authority to set rate of taxation for pari-mutuel wagering activities between 20-28 percent. Gambling Commission authorized to establish the rate of taxation at each licensed pari-mutuel wagering location, based on the following factors:

  • Type of activity licensed.
  • Number of pari-mutuel wagering machines.
  • Net revenues
  • Crime rate in the jurisdiction.
  • Frequency with which law enforcement is requested to respond to an incident at the location.
  • Needs of the local jurisdiction.
  • Other factors determined by the
    commission.

(2) Sports wagering tax not applicable.
(3) Distribution of tax proceeds provided in CA.

Court of Civil Appeals (Same as House)

(1) Has original jurisdiction in all cases where the commission is made a party.
(2) Hearing officer. Authorized to be appointed to develop a trial record. Paid for by commission.

Criminal Laws

(1) Increased penalties on various criminal laws relating to unlawful gambling activities. (Same as House).
(2) Language added to strengthen civil asset forfeiture of unlawful gambling proceeds and equipment.

Campaign Finance

Strong campaign finance language prohibiting contributions by gambling interests. (Same as House).

Effective Date

Upon ratification of CA.

Grayson Everett is the state and political editor for Yellowhammer News. You can follow him on Twitter @Grayson270

Don’t miss out!  Subscribe today to have Alabama’s leading headlines delivered to your inbox.