FISCAL NOTE

Senate Bill 310 as introduced would implement the provisions of the constitutional amendment proposed by Senate Bill 214 of the 2021 Regular Session by establishing the Alabama Gaming Commission as the state the agency responsible for supervising the Alabama Education Lottery, bingo, charitable bingo and raffles, sports wagering, and casino-style games in the state.

This bill authorizes license fees for casino-style games and sports wagering upon covered operators, in which the receipts would be deposited into the Gaming Trust Fund by an amount to be estimated at $7-$10 million annually. This bill also requires: (1) a $100,000 non-refundable license and application fee for management service providers, which would also be deposited into the Gaming Trust Fund, an amount estimated to be $2 million annually, dependent on the number of management service providers hired by each covered operator; and (2) a nominal license fee, the amount to be determined by the Commission, to be collected from charitable bingo and raffle operators, which would also be deposited into the Gaming Trust Fund, the amount which would be dependent upon the number of charitable bingo and raffle operators applying for a license and the amount of the license fee set by the Commission.

This bill levies a 20% tax on net gaming revenues for the covered location, of which, would be distributed as follows:

1. 95% to the Gaming Trust Fund;

2. 3% to the county commission of a county in which a covered operator is licensed; and

3. 2% to the governing body of the municipality in which a covered operator is located or to the county commission of the county in which the covered operator is licensed, if located within the police jurisdiction.

Once operational, and after the payment of reasonable expenses of the Gaming Commission, receipts to the Gaming Trust Fund are an estimated $260-$393 million annually from the 20 percent tax on net gaming revenues. This bill further provides that funds in the Gaming Trust Fund shall be appropriated by the Legislature in an independent supplemental bill as follows:

1. 65% for Informational Technology Infrastructure, of which the first $1 billion shall be set aside for the statewide development and expansion of broadband.

2. 25% for the provision of rural health services; and

3. 10% for mental health services.

However, once the $1 billion for statewide broadband has been distributed, the proceeds shall be appropriated as follows:

1. 25% for capital or other non-recurring expenses;

2. 25% for rural health care services;

3. 25% for Information Technology infrastructure;

4. 15% for mental health services; and

5. 10% for grants to be awarded for infrastructure improvements to municipalities and counties that do not have gaming facility in corporate limits;

This amendment provides that tax revenues from sports wagering, shall be used first to repay the Alabama Trust Fund under the People’s Trust Act, and upon completion of repayment, to be deposited into the General Fund Budget Reserve Fund, until the total balance, is at least $100 million, at which time the tax on gaming revenues from sports wagering would be deposited 75 percent to the State General Fund; and 25 percent to the Alabama Trust Fund.

This bill would authorize the Department of Examiners of Public Accounts to audit or examine the Alabama Lottery Corporation, which could increase administrative obligations to the Department by an undetermined amount dependent upon the number of audits they must perform.

This bill would require the Attorney General to represent the commission and the executive director in any proceeding to advise on all other matters, which could increase the administrative obligations of the Attorney General’s Office by an undetermined amount dependent upon the number of proceedings they participate in and the extent to which they advise the Commission.

In addition, this bill will increase the obligations of the following agencies for the following purposes, by undetermined amounts as follows: (1) the Alabama Law Enforcement Agency for the purpose of facilitating the assistance of law enforcement officers in investigation and enforcement of gaming violations and general laws and rules of the Law Enforcement Division of the Commission; (2) county sheriffs of counties where a covered operator is located to assist the Law Enforcement Division of the Gaming Commission in the investigation and enforcement of gaming violations and general laws and rules of the Commission; and (3) the Alabama Peace Officer’s Standards and Training Commission to consult on the annual training that should be provided to ALEA agents and sheriffs providing assistance to the Commission’s Law Enforcement Division.

Further, this bill would authorize the Alabama Department of Economic and Community Affairs to administer the grant programs awarded to municipalities and counties, for infrastructure improvements, that do not have a gaming facility within their corporate limits, which would increase administrative obligations of ADECA by an undetermined amount, dependent upon the number of applications received and the number of grants awarded.

Finally, as introduced this bill would establish criminal penalties related to unlawful lottery activity which could increase receipts to the State General Fund and municipal general funds from fines; increase receipts to the State General Fund, county general funds, municipal general funds, and other funds to which court costs are deposited; and could increase the obligations of the State General Fund, local jails, the district attorneys, the Department of Corrections, the Bureau of Pardons and Paroles, and community corrections programs by an undetermined amount dependent upon the number of persons charged with and convicted of the offenses provided by this bill and the penalties imposed.