The fight to regulate video gambling machines in North Carolina is not over yet.
While efforts to add retail and online casinos in North Carolina have failed at the statehouse, a bill to legalize the slot-like machines is still alive in the House. Despite being banned in 2008, the machines continue to be played in cafes and other establishments across the state.
House Bill 512 still has a long road to passage, but the bill’s sponsor thinks the time might be right as the North Carolina General Assembly reconvenes.
Tax rate on machines would be 40% under HB 512
Like retail casinos in the Tar Heel State, North Carolina online casinos remain illegal.
The push to regulate video gambling machines (VGMs) in North Carolina is led by state Rep. Harry Warren, R-Salisbury. HB 512 would “authorize and regulate video gaming terminals in the state,” with the North Carolina State Lottery regulating the industry.
Part of the tax revenue from VGMs would go toward a Community College Scholarship Loan Program, which would be created in tandem with the legalization of the machines.
The legislation would create three types of licenses. The first type would be a manufacturer license, of which no less than five would be made available. The second would be an operator license, of which there would be at least 12 available. Lastly, there would be a merchant license. Business owners would be allowed to have up to six machines per location, which could be increased by four if given permission.
Under the bill, 32% of revenue from the machines would go to a newly created North Carolina Video Lottery Fund. Another 8% would be collected for administrative expenses by the Lottery. Operators would get 35% of revenue, while 25% would go to merchants.
Sponsor of HB 512 says machines are popular with residents
Warren said there is a clear desire from North Carolina residents to play VGMs. He said that is the reason he is attempting to regulate them as opposed to law enforcement seizing them.
“The real reason these things flourish is because people play them. If there were no money in it, they would not be in business.”
Warren said he wants to see VGMs benefit the state instead of them being associated with crime.
“We’re a free market economy. We’re based on supply and demand, and people are demanding it. But by restricting, regulating and reducing the supply, we can eliminate sweepstakes parlors and the seedy aspects of unregulated gambling, replacing it with a limited supply of gaming entertainment that fulfills the public demand and the safer controlled environments, and safer conditions.”
What’s next for HB 512?
The bill was originally filed in March 2023, but it lost momentum. Other efforts were put foward that combined casino legalization with VGMs. Warren hopes HB 512 will gain traction when the legislative session renews on April 24.
The bill currently sits in the House Commerce Committee. If it advances out of Commerce, it would head to the Appropriations Committee before being referred to the Rules, Calendar and Operations Committee.
The process still has a long way to go. But Warren believes there is an appetite to pass the bill in the General Assembly.
“There’s been a change in attitudes towards different things, whether it’s Medicaid expansion, sports betting, medicinal marijuana, there’s subjects being entertained that five years ago wouldn’t have made it out of Rules Committee. Plus, this is a very good bill, and so if people take the time to read it, I think they’ll come on board with it.
“As I said in the meeting, not to vote for this bill is to do nothing, and in essence that’s condoning the illegal activity that’s going on now. Why would we do that?”
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