North Carolina is potentially days away from the legalization of mobile sports betting, expanding the industry’s reach within the state beyond its three tribal casinos. And that’s not all. Horse race betting would also be allowed statewide under a bill now being finalized in Raleigh.
The Senate added horse race betting to the North Carolina online sports betting bill (HB 347) in a key 37-11 vote last week. The House voted 67-42 on Tuesday to concur with the Senate’s changes and could vote as early as Wednesday on a third reading of the bill. Next, the legislation would go to Gov. Roy Cooper, who has indicated he will sign it into law.
Once signed by Gov. Cooper, the law would put North Carolina’s mobile sports betting apps, limited commercial retail sports betting, and ADW (advance-deposit wagering) horse race betting on track for launch, giving the state Lottery Commission a requested 12 months to license and regulate both mobile and retail sports betting and ADW licensees.
It’s a significant shift for a state that now only allows charitable horse racing and no pari-mutuel wagering outside tribal lands. But the shift didn’t come overnight. North Carolina has been talking about legalizing horse race betting for years, with the last push for a legal thoroughbred racing industry in 2021 with the North Carolina Derby Act (Senate Bill 629) sponsored by Sen. Paul Lowe and Sen. Jim Perry.
That bill stalled, but not before galvanizing North Carolina lawmakers to capitalize on a centuries-old sport that remains largely untapped at home.
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Horse Racing, Horse Betting Push Not New to North Carolina
Live horse racing in North Carolina is currently limited to charitable thoroughbred racing at the Queen’s Cup Steeplechase near Charlotte and some harness racing. No betting is allowed on any of those races, which limits participation and revenue needed to develop a state horse racing industry.
According to the May 2021 issue of the horse industry magazine The Plaid Horse, Lowe saw an opportunity for “great economic growth” with horse racing in North Carolina when he filed SB 629 in April of that year. The Forsyth Democrat at the time reportedly “stressed that the horse racing industry is massive” in the state.
“The extra money that is generated from betting on a horse will go back to the state and invested in the state budget,” Lowe reportedly told The Plaid Horse. “With a billion-dollar industry, the opportunities are immense. With a legal race track here and there around the state of North Carolina, there will be more growth with restaurants, shops, malls, and even hotels that will cater for gamblers that are visiting the state to attend the races.”
Lowe also told WRAL-TV that same year that a legal horse racing industry could mean economic development in rural areas and more money for the state budget – not just from tourism and betting, but from the technical aspects of the sport.
“There’s a lot that goes into it,” WRAL reported Lowe as saying. “There are already people who train horses here to send to Kentucky. Kentucky is not the only state that can do something like this.”
Horse Racing Back In Neighboring Virginia
He’s right. Virginia is doing it, too, along with statewide online sports betting and opening new commercial casinos.
After being dormant for several years, live horse racing restarted in 2019 at Churchill Downs-owned Colonial Downs located in New Kent, halfway between Richmond and Williamsburg. The track (one of two in Virginia with live racing) has about seven weeks of racing per year including a Grade 3 $500,000 New Kent County Virginia Derby in September. Horse racing betting is also available at several OTB sites in the state.
Like select tracks in Kentucky – Churchill Downs’ headquarters – Colonial Downs also offers historical horse racing (HHR), which the state legalized and launched in 2018. HHR is video lottery terminal betting that allows patrons to bet on past races as a video slots experience.
Then there are the up to five brick-and-mortar casinos that Virginia has approved by referendum. A couple of those are located close to the border of North Carolina, including a temporary Caesars location in Danville. That’s only about 25 miles from the home of North Carolina Senate President Pro Tempore Phil Berger.
The Virginia Effect
North Carolina may be feeling the weight of Virginia’s gambling expansion. Just last week, it was rumored that the state House might not agree with Senate changes to HB 347 unless the legislation included a pathway for legal commercial casinos, with a focus on rural areas.
Any discussions that took place were apparently settled last week. The Associated Press reported June 1 that Berger “said he thought it best to finalize the sports gambling measure – which had support from House bill sponsors – before considering other gambling ideas.”
But plans for more gambling in North Carolina could be here to stay. House Speaker Tim Moore says he is “interested in combining casino-expansion legislation with language regulating and taxing video poker machines, which are currently illegal under state law,” according to the Associated Press article.
Horse racing could be a starting point, should legislation tying casinos to racetracks (the racino model) be proposed and passed in North Carolina in the future. For now, though, it’s anybody’s bet.
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