Nebraska online sports betting bill stalls as legislative session ends

Efforts to legalize online sports betting in Nebraska faced another setback as the state’s special legislative session adjourned without addressing the issue, postponing the debate until January.

The 17-day special session, which concluded sine die on Tuesday, focused primarily on property tax relief and left the fate of two sports betting bills introduced by Senator Eliot Bostar, LR 3CA and LB 13, unresolved. The bills aimed to legalize online sports betting but did not make it to the floor for discussion.

Hopes for advancing the legislation faded as the special session went on. Besides, a group of 13 senators referred to the proposed sports betting legalization as "a poison pill," presenting a major hurdle for the initiative.

Without online sports betting, Bostar warned that the state is losing an estimated $32 million in annual tax revenue. His bills sought to allocate 90% of proceeds from sports betting to Nebraska’s property tax relief fund.

If online sports betting remains off the table, Nebraska could forfeit up to $100 million in tax revenue by 2026, according to Bostar.

Currently, Nebraska allows sports betting only at four in-person sportsbooks, which generated nearly $2 million in tax payments during the latest fiscal year. Seventy percent of all gambling revenue is directed to the state’s property tax relief fund.

The failure to advance digital sports betting legislation in Nebraska also marked the final opportunity for gambling expansion in the U.S. in 2024. This year, no state has legalized any form of sports betting, making it the first such year since the repeal of the Professional and Amateur Sports Protection Act (PASPA) in 2018.

Nebraska Governor Jim Pillen called the special session to address the state’s heavy property tax burden, which ranks among the top 10 in the U.S. Pillen viewed sports betting as a potential tool to generate revenue for property tax relief, as proceeds from gambling taxes are earmarked for funding public education.

However, Nebraska lawmakers appeared uneducated about, and unprepared to act on digital sports betting. Despite allowing wagers on college sports, state law prohibits betting on Nebraska teams when they are playing in state, further complicating the push for expanded gambling.

The legislature passed LB 34, a bill capping property tax increases and introducing a relief program, but left other measures unresolved. With bills from the 2024 session not carrying over to 2025, lawmakers will need to reintroduce legislation in the new session beginning January 8, 2025.