Bill Summary for H 347 (2023-2024)

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Summary date: 

May 30 2023

Bill Information:

View NCGA Bill Details2023-2024 Session
House Bill 347 (Public) Filed Monday, March 13, 2023
Intro. by Saine, Bell, Hawkins, Clemmons.

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Bill summary

Senate committee amendment to the 4th edition makes the following changes.   

Makes the following changes to new Article 9 of Chapter GS 18C (pertaining to sports wagering). Amends the definition of pari-mutuel wager set forth in GS 18C-901(12) to cross reference the definition in GS 18C-1001, which defines pari-mutuel wagers or wagering as a form of wagering on the outcome of horse races, whether live or simulcast, in which wagers are made on one or more horses and all wagers are pooled and held by the host of the race or the ADW licensee for distribution (was, a betting system in which all the bets of a particular type are placed together in a pool and the sports wager is placed against other sports wagers on the same sporting event in which the participants finish in a ranked order). Expands the list of types of sports wagering suppliers defined in GS 18C-1001(22) to include entities engaged in facilitating or enabling sports wagering activities on behalf of, or in affiliation with, interactive sports wagering operators in places of public accommodation. 

Makes clarifying change to GS 18C-902(i)(4) (pertaining to when members of the NC State Lottery Commission (Commission) are prohibited from engaging in sports wagering).

Amends GS 18C-904 (establishing an interactive sports wagering license) as follows. Amends the applicant refund provisions set forth in GS 18C-904(b) to specify that if the Commission denies an application for a sports wagering license, a flat rate of 5% of the applicant’s fee application will be retained by the Commission to offset associated expenses in reviewing the application (previously, Commission refunded application fee minus any expenses it incurred in reviewing the application). Specifies that the information pertaining to the applicant’s history of job creation in the State, plans for continued job creation, a documented history of capital investment in the State, plans for continued capital investment in the State, a documented history of partnership with a sports facility (if any), and the intentions of partnership to offer the placement of sports wagers at a place of public accommodation in accordance with Article 9 of GS Chapter 18C are informational in nature and intended to provide additional insight regarding applicants who intend to operate a place of public accommodation. Amends the public records provision of the section to clarify that the public records section pertaining to applications do not disrupt the provisions of GS 18C-916(b), which require that certain Commission records be treated as nonconfidential. Specifies that interactive sports wagering operator licenses are not assignable or transferrable unless the Commission approves and the licensing fee is paid (was, just approval by the Commission required). Specifies that the holder of an interactive sports wagering operator license is also deemed to hold a service provider license and sports wagering supplier license under the article for services, goods, software, or components provided in-house (makes conforming changes to GS 18C-907 by no longer providing that an interactive sports wagering operating providing covered services in-house must not be required to have a sports wagering supplier license in addition to the interactive sports wagering operator license). Allows for a sports facility or team to contractually appoint a designee approved by the Commission for all aspects of Commission oversight and operation if the sports facility or team applicant is a member of a league, association, or organization that prevents the sports facility or team from being subject to the regulatory control of the Commission or from otherwise operating under an interactive sports wagering license. 

Amends the applicant refund provisions set forth in GS 18C-906(b) (service provider license) and GS 18C-907(d) (sports wagering license) to specify that if the Commission denies an application for a license, a flat rate of 5% of the applicant’s fee application will be retained by the Commission to offset associated expenses in reviewing the application. Amends the public records provision of each section to clarify that the public records section pertaining to applications does not disrupt the provisions of GS 18C-916(b), which require that certain Commission records be treated as nonconfidential. Specifies that sports wagering supplier licenses are not assignable or transferrable unless the Commission approves and the licensing fee is paid (was, just approval by the Commission required).

Amends GS 18C-908(c)(2) (revocation or nonrenewal of licenses) to specify that a violation of the article or a pattern of noncompliance with rules or directives promulgated by the Commission are a ground for nonrenewal or revocation (was, just a violation of the article). Adds the Commission’s previous decision to suspend or impose civil penalties on the licensee as a ground for nonrenewal or revocation of a license issued under GS Chapter 18C, Article 9. Also amends GS 18C-908 by adding that the Commission may require an annual attestation of compliance from licensees; requires when a licensee identifies an instance of technical or material noncompliance in its annual attestation of compliance, that the licensee also submit a remedial or mitigation plan for the Commission's consideration.

Amends GS 18C-909 to allow the Commission to also use license fees collected under GS Chapter 18C, Article 10, for expenses in administering Article 9 (was, just fees collected under Article 9). Makes clarifying change to GS 18C-909(b). Expands the scope of the advertising requirements under GS 18C-910(e) (duties of licensees) to include marketing of its sports wagering platform and related commercial offerings (was, just advertising of the platform) to require that the operator or those acting on its behalf (was, just the operator) ensure that advertisements and marketing messages and materials (was, just advertisements) also satisfy the rules and regulations promulgated by the Commission, in addition to other listed requirements. Adds choice of law requirement and forum selection clause. Bars any interactive sports wagering operator from requiring a registered player to waive any right, forum, or procedure otherwise available to the registered player under State or federal law. 

Amends GS 18C-912(c)(3) (requirements for interactive accounts) to only require that an interactive account be funded with cash or cash equivalents (was, cash or cash equivalents online or placed at a sports facility). Adds requirement that the interactive account must meet or exceed the minimum requirements identified by the Commission, including technical requirements related to data privacy, data security, and sports wagering platform features to support responsible sports wagering.  

Makes clarifying change to GS 18C-914(a) (integrity of competition and prohibited events). Adds new subsection GS 18C-916(b) specifying that non-public record documents and materials that applicants and licensees submit to the Commission will become public record if such materials are specifically identified by the Commission as providing a basis for a civil penalty, license suspension, license revocation, or other formal or informal enforcement action taken by the Commission against the licensee.

Expands the scope of individuals required to use reasonable means to comply with the exclusion of individuals participating in the voluntary exclusion program set forth in GS 18C-922 to include any licensee under Articles 9 and 10 of GS Chapter 18C (was, just interactive sports wagering operators). Makes conforming changes throughout GS 18C-922 to account for increased scope of licensees and inclusion of pari-mutuel wagering.

Amends GS 18C-926 (pertaining to places of public accommodation) to specify that each sports facility may partner with one interactive sports wagering operator to provide places of public accommodation. Requires that advertisements of a place of public accommodation comply with the requirements of GS 18C-910(e). Deletes subsection providing that no sports facility can be open for placing sports wagers during the eight hours before or during any college sports events at the sports facility or adjacent to the sports facility.

Makes clarifying and technical changes to GS 18C-928(c)(2)(e) (pertaining to agreements by a tribal gaming enterprise as part of a licensed interactive sports wagering operator application under GS 18C-928). 

Amends the definitions provision of new GS Chapter 18C, Article 10 (Pari-Mutuel Wagering), as follows. Amends pari-mutuel wager or pari-mutuel wagering to remove previously run horse races from the definition. Clarifies that simulcast means the telecast of live audio and visual signals of horse races at a simulcast facility (previously, no reference to simulcast facility).

Amends GS 18C-1005 to allow the Commission to accept criminal history checks from applicants and its key persons that have been run in the 12 months prior to the application if an affidavit is submitted that states there has been no change in criminal history since the prior criminal history record check in this or any other state. Allows for persons holding comparable licenses in other states to be licensed as a sports wagering supplier with or without further examination as determined by the Commission.

Makes technical change to GS 18C-1010. Specifies that application fees and annual fees collected under the article (was, just the section) can be used to offset the cost of administering the provisions of the article and Article 9 of GS Chapter 18C.

Makes clarifying change to GS 18C-1015(b). 

Specifies that the article does not authorize non-pari-mutuel wagering on the outcome of live, simulcast, or any other horse races (was, notwithstanding any other provision of law, an individual shall be permitted to place wagers on previously run horse races when physically located at a facility conducting a live horse race in this State).

Amends GS 18C-1025 (rulemaking) to delete requirement that Commission comply with Article 2A of GS Chapter 150B when adopting rules under the article. Also deletes requirement that Commission adopt rules on previously run horse races. Now requires the Commission to adopt rules governing the conduct of horse racing in the State, which must include rules regarding play of wagers on simulcast horse races. 

Further amends GS 18C-114 by amending the Commission’s powers related to Commission employees, to now also prohibit Commission employees from: (1) having a financial interest in any lottery licensee; (2) participating, if the employee has decision making authority, in any decision involving a licensee or license applicant with whom the employee has a financial interest; (3) representing, after leaving Commission employment, any licensee or license applicant.

Further amends GS 18C-120 by giving the director the power and duty, under the supervision of the Commission, to exercise authority assigned or delegated by the Commission.

Amends the stated purpose of GS Chapter 18C in GS 18C-102 to include, in addition to establishing a State-operated lottery, also providing for the regulation of other sanctioned gaming enterprises in order to generate funds for the stated public purposes and to support responsible gaming.

Amends GS 18C-113 by amending the provision that makes Commission records open and available to the public, by making an exception for exceptions stated in Article 2 (North Carolina State Lottery Commission) or when disclosure would be used to (1) provide an unfair advantage to a  player or (2) impair or adversely impact the security or integrity of the Lottery’s operation, any of its games, or investigations into potentially fraudulent or other activities in violation of any laws, Lottery rules, regulations, and policies.

Amends GS 18C-122 to allow the Commission to hear reports on the following, which are exempt from GS Chapter 132 (Public Records): (1) information on any vulnerabilities in Commission or Lottery security procedures, (2) information that could impair or adversely impact the Lottery or Commission’s security in carrying out its responsibilities, and (3) information that could be used to provide an unfair advantage to a player or jeopardize the integrity of any lottery game.

Amends GS 18C-161 by excluding from funds that must be deposited into the North Carolina State Lottery Fund those that are excepted under Articles 9 (Sports Wagering) and 10 (Pari-mutuel Wagering) of GS Chapter 18C.

Amends GS 18B-1005(a)(3), which prohibits an ABC permittee or their agent from allowing on their premises any violation of the controlled substances, gambling, or prostitution statutes, or any other unlawful acts, but specifying that gambling does not include wagering that is exempted by GS 4-309.3.

Amends GS 105-113.128, concerning the use of the proceeds of the tax on interactive sports wagering operators, as follows. Changes the recipient of the $1 million for youth sports grants from the North Carolina Division of Parks and Recreation to North Carolina Amateur Sports, expands upon allowable grant recipients to include nonprofits in addition to local governments, requires awards to be used for the purchase of youth sports equipment or to provide public facility upgrades or improvements that would benefit youth sports, and adds that awards may be given only to applicants who demonstrate a primary purpose for the funding is to facilitate opportunities for persons up to age 18 to engage in youth sports. Amends the use of the $1 million in funds distributed to the North Carolina Outdoor Heritage Advisory Council for grants by specifying that the cap is per sporting team or group (was, sports team) per county per year, and amends the incentive grants to allow them to be also used to attract area events, to include tournaments and programs that are for sporting participants (was, nonprofessional athletes), and to allow the grants to be used for programs administered by non-profits, as determined by the North Carolina Outdoor Heritage Advisory Council, in addition to those administered by city, county, and local school administrative units. Amends the recipients of the 20% of remaining proceeds that are distributed equally among the listed institutions to support collegiate athletic departments to also include Appalachian State University, East Carolina University, and UNC-Charlotte.

Adds that if Senate Bill 22 (Rename Outdoor Heritage Advisory Council), or substantially similar legislation becomes law, then GS 105-113.128 is amended to refer to the Outdoor Heritage Advisory Council as the North Carolina Youth Outdoor Engagement Commission and makes conforming changes.

Makes a clarifying change in Section 7 of the act. Also specifies that sports wagering is not authorized in the State until a date identified by the Commission, which must occur as soon as practicable and may be no later than twelve months after the date this act becomes law.

Amends the study by the Commission on the implementation of Articles 9 and 10 of GS Chapter 18C to require addressing the siting and opening of places of public accommodation (was, of public places of accommodation) and usage of those sites.

Changes the spelling of parimutuel with pari-mutuel throughout the act.