Louisiana Hikes Sports Betting Taxes to Boost College Athletics
In a significant move, Louisiana is set to increase taxes on sports betting, aiming to inject over $24 million into its prominent public universities’ athletic departments. The proposed legislation, awaiting approval from Governor Jeff Landry, would make Louisiana the first state to utilize sports betting tax revenues to fund college sports since a recent NCAA settlement authorized direct payments to athletes for their name, image, and likeness (NIL).
The new NCAA rules, effective July 1, will allow Division I schools to share up to $20.5 million annually with their athletes—an easier feat for big programs than for smaller institutions. Louisiana’s tax overhaul, which imposes a 21.5% tax rate on online sports betting proceeds, is a collaborative effort between lawmakers and athletic directors who have been seeking financial relief amidst increasing operational costs. The newly generated revenue will be equally divided among 11 public universities, earmarked for student-athlete benefits such as scholarships and medical coverage.
With financial pressures intensifying, especially for smaller universities, lawmakers found it crucial to redirect sports betting tax revenues back to the institutions producing the athletes. "Without the athletes, we wouldn’t have the revenue. It’s fairness that we give something back," stated Republican state Rep. Neil Riser, the bill’s sponsor.
This legislative initiative follows a trend, as other states are also exploring ways to allocate sports betting revenue to college athletics. North Carolina, for example, has initiated a similar funding strategy to support its university programs amidst rising financial stress. Experts believe that as states compete to attract talent and enhance their college sports programs, more will likely adopt comparable measures.
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