The success of North Carolina sports betting could soon reap benefits for colleges and universities in the state.
A House proposal placed into the 2024-25 state budget would allow North Carolina’s top colleges to split 5% of tax revenue from sports betting. They were left out of the original sports betting law.
It would result in millions of dollars going to schools if North Carolina sports betting continues to exceed expectations.
Some schools could receive over $1M each year
The sports betting law presently allocates $8.4 million to NC universities and various other state agencies and programs. The House budget proposal would increase that to $13.4 million.
If sports betting revenue remains after paying out that $13.4 million, the excess revenue is currently allocated as follows:
– 20% to NC universities (excluding UNC and NC State).
– 50% to the state General Fund.
– 30% to the Major Events, Games, and Attractions Fund.
The proposal from the House would drop the 30% to the MEGA Fund to 25% and take the remaining 5% to be distributed to the state’s largest universities, including UNC and NC State.
North Carolina State and the University of North Carolina at Chapel Hill would each receive an estimated $930,000 in FY 2024-25.
Appalachian State, Charlotte, East Carolina and North Carolina A&T are each projected to collect as much as $1.7 million annually, according to reporting by WRAL News in Raleigh.
UNC-Asheville, UNC-Greensboro, UNC-Pembroke, UNC-Wilmington, Western Carolina, Winston-Salem State, Elizabeth City State, Fayetteville State and North Carolina Central would each receive $845,385 under the proposal.
State collected more than $11M from sports betting in May
The proposal, which has bi-partisan support in the North Carolina House, stems from the unexpected windfall of tax revenue since the state launched legal sports betting in March.
In May, the state collected approximately $11.3 million in tax revenue from the eight licensed sports betting operators. That significantly exceeded projections made before the launch, said Rep. Jason Saine, a Republican who is co-sponsoring the proposal. “There’s so much more money coming in from sports betting than was originally forecast,” Saine explained to reporters.
The full House must approve the budget before it goes to the Senate, where changes are bound to occur. If the sports betting tax revenue proposal survives that process, Gov. Roy Cooper, a Democrat, would have to sign the budget into law.
College sports landscape is changing
The proposal from lawmakers in the North Carolina House of Representatives comes at a time when the economics of college sports are being altered dramatically.
Last month, the NCAA announced settlement of a lawsuit that will result in tens of millions and perhaps hundreds of millions of dollars going to some schools to compensate athletes in popular sports like football and basketball.
At the same time, the power conferences have shifted alignment, with the SEC and Big 10 getting more profitable athletic programs, while the Pac 12 has all but collapsed following an exodus of schools.
According to WRAL, North Carolina and NC State each have athletic department budgets exceeding $100 million annually. Sports betting tax revenue could now boost them.
NCAA expresses concerns over safety of athletes
How colleges in North Carolina would use the money remains to be seen.
Ever since legal sports betting began its sweep across the US, the NCAA has voiced its fears that gambling could endanger student-athletes along with the integrity of college sports.
Earlier this year, the NCAA reported that sports betting impacts the mental health of student-athletes in North Carolina and elsewhere.
Some of the colleges and universities in North Carolina could use the money from sports betting to protect student-athletes and educate fans on responsible gambling.
Image Credit: Gerry Broome / AP Images
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