HB 736-FN - AS INTRODUCED
2025 SESSION
25-0752
02/08
HOUSE BILL 736-FN
SPONSORS: Rep. Doucette, Rock. 25
COMMITTEE: Ways and Means
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ANALYSIS
This bill requires the lottery commission to issue licenses to at least 3, but no more than 5, mobile sports wagering agents within 2 years of the effective date of this act, and provides that such licenses shall be valid for a period of 10 years.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
25-0752
02/08
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Twenty Five
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Mobile Sports Wagering Authorized; Number of Agents. Amend the introductory paragraph of RSA 287-I:7 to read as follows:
The commission and its agents are authorized to operate sports books that offer tier I, tier II, and tier III sports wagers through a mobile sports wagering platform by mobile devices or over the Internet. No more than 5, and not fewer than 3, mobile sports wagering agents shall be in operation at any given time. The commission shall issue licenses pursuant to this section to at least 3 agents no later June 30, 2027. Such licenses shall be valid for a period of 10 years. With respect to mobile sports wagering, the commission, either independently, or through its agent, shall provide:
2 Effective Date. This act shall take effect July 1, 2025.
25-0752
Revised 1/27/25
HB 736-FN- FISCAL NOTE
AS INTRODUCED
FISCAL IMPACT: This bill does not provide funding, nor does it authorize new positions.
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Estimated State Impact | ||||||
| FY 2025 | FY 2026 | FY 2027 | FY 2028 | ||
Revenue | $0 | $0 | $5,500,000 Decrease | $5,500,000 Decrease | ||
Revenue Fund(s) | Lottery Fund/Education Trust Fund - Lottery revenue is credited to the lottery fund, with net revenues after expenditures being credited to the state education trust fund. | |||||
Expenditures* | $0 | $0 | $419,000 Increase | $426,000 Increase | ||
Funding Source(s) | Lottery Fund/Education Trust Fund - Lottery revenue is credited to the lottery fund, with net revenues after expenditures being credited to the state education trust fund. | |||||
Appropriations* | $0 | $0 | $0 | $0 | ||
Funding Source(s) | None | |||||
*Expenditure = Cost of bill *Appropriation = Authorized funding to cover cost of bill | ||||||
METHODOLOGY:
This bill requires the Lottery Commission to issue licenses to at least three (3), but no more than five (5), mobile sports wagering agents, no later than June 30, 2027, and provides that such licenses shall be valid for a period of 10 years. The Lottery Commission, based on the information and assumptions provided below, state this bill would result in a decrease to state revenue of approximately $5.5 million per year, beginning in FY 2027, and increase Lottery administrative expenses by $419,000 in FY 2027 and $426,000 in FY 2027, for a net impact on transfer of Lottery revenue to the education trust fund of approximately $5.9 million in each FY 2027 and FY 2028.
The Lottery Commission has provided the following assumptions relative to this bill:
- The first sports wagers resulting from these new licenses must begin July 1, 2026, as the existing contract for mobile and retail sports wagering is set to expire June 30, 2026, if not extended.
- The current contract with DraftKings provides the state with a 51% revenue share from mobile sports betting revenue and 50% revenue share from retail sports betting revenue in exchange for DraftKings being the sole provider of the mobile and retail channel.
- Adding two to four (2 to 4) additional mobile sports betting operators will require a significant decrease in the current 51% revenue share percentage payable to the state, based on models in other states, to attract quality licensees.
- While it is too early to accurately estimate final FY 2025 or FY 2026 revenue, it is assumed to remain consistent for FY 2027 and FY 2028 (approximately $30,300,000 per year).
- Moving from a one (1) operator market to a three to five (3 to 5) operator market in FY 2027 is assumed to result in very large advertising campaign by all licensees offering mobile sports wagering, which could spur new customer signups.
- It is assumed that the amount wagered and number of active users in New Hampshire could grow by 10 to 20% per year in a three to five (3 to 5) operator market.
- It is assumed that the “house” win percentage will continue to be between 6-10% of the total amount bet, which would be consistent with industry and in-state experience since inception.
- It is assumed the addition three (3) total positions (two (2) accounting positions and one (1) program specialist beginning work on or before July 1, 2026), to assist in the management and oversight of multiple sports betting vendors, as well as ongoing IT support services of $150,000 per year during operation.
- The marketplace for mobile sports betting has changed significantly since initial passage in 2019, with Vermont’s recent passage in 2023 being a good example:
- Vermont performed a bid process for three to five (3 to 5) mobile sports betting vendors which resulted in three (3) vendors that provide 32% of gross gaming revenue to the state with certain deductions, such as for the federal excise tax on sports wagers, allowed before the split.
Fiscal Impact Calculations
Based on a revenue share structure like Vermont (discussed above), with three (3) licensees, it is estimated state revenue would be $24,800,000*, a decrease in revenue of $5,500,000 per year for FY 2027 and FY 2028. In addition, Lottery administrative expenses would also increase relative to the need for three additional positions and increased IT related costs. Below is a summary of the potential fiscal impact of this bill:
| FY 2027 | FY 2028 |
Revenue Decline | ($5,500,000) | ($5,500,000) |
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Position Costs | $269,000 | $276,000 |
IT Costs | $150,000 | $150,000 |
Total Increased Costs | $419,000 | $426,000 |
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Impact to Lottery Net Profit / Transfer to ETF | ($5,919,000) | ($5,926,000) |
*The annual revenue estimate of $24,800,000 was determined by using a 20% increase in handle, and a hold of 10%.
- Handle of $661,483,883 + 20% = $793,780,660
- Net gross gaming revenue = 10% of $793,780,660 = $79,378,066.
- Less Federal Excise Tax; $79,378,066 - $1,984,452 (0.25% of handle) = $77,393,614
- State takes 32% of $77,393,614= $24,765,956 (rounded up to $24,800,000)
Implementation Concerns
The Lottery Commission has identified the following implementation concerns relative to this bill:
- Current statute requires a competitive bid process and vendor of state model with contractual approval from Governor and Executive Council. There is no licensing model or procedure in place. The standards by which the Commission shall choose operators would need to be defined and RSA 287-I amended accordingly.
- Under the current statute, the criteria set forth for considering bids from sports betting agents required the Commission to select those “…whose bids provide the state with the highest percentage of revenue from the sports wagering activities covered by the bids…” For the reasons above, the Commission believes this bill will result in less revenue generated to the state and would therefore require changes to the current statutory criteria.
- This bill does not address retail sports betting operations, which are currently governed by the same contract as mobile sports betting operations set to expire June 30, 2026.
AGENCIES CONTACTED:
Lottery Commission