HB490 Alabama 2025 Session

Summary

Primary Sponsor

Jeremy GrayRepresentative

Democrat

Session

2025 Regular Session

Title

Alabama Sports Wagering Control Act; licensure of sports wagering activities provided for; student athlete compensation for name, image, and likeness provided for

Summary

This bill would create a state system to regulate sports wagering and also establish a framework to regulate and tax student-athlete NIL compensation in Alabama.

What This Bill Does

It creates the Alabama Gaming Commission to license and regulate online and in-person sports wagering, levy a 10% tax on net gaming revenue, and distribute the proceeds to a Gaming Proceeds Trust Fund (40% General Fund, 40% Education Trust Fund, 20% NIL Trust Fund). It authorizes issuance of licenses, sets licensing rules and fees, and imposes penalties for violations, including a $1,000,000 fine for wagering on high school events. It also establishes the NIL Oversight Committee to regulate name, image, and likeness compensation for student-athletes, creates an NIL Certification Program, and provides a state income tax exemption for NIL income under certain conditions; it requires mandatory financial literacy and life-skills training before NIL payments and imposes rules to prevent exploitation or conflicts with school policies. The act also prohibits high school wagers, requires large-bet and suspicious-wager reporting, and sets an effective date of October 1, 2025.

Who It Affects

• Sports wagering licensees, online platforms, and bettors in Alabama, who would be regulated, taxed, and required to follow licensing, reporting, and consumer-protection rules.
• Student-athletes, public high schools, school officials, and educational organizations, who would participate in NIL compensation programs, be subject to training and certification, have a portion of NIL income placed in a state NIL Trust Fund, and operate under new oversight to ensure proper use of NIL rights.

Key Provisions

• Establishes the Alabama Gaming Commission to license and regulate all lawful gaming activities, including sports wagering, and to oversee personnel and operations.
• Authorizes licenses for in-person and online sports wagering; license fees and term lengths set by the Commission; minimum and maximum online licenses to promote competition.
• Imposes a 10% state tax on net gaming revenue from sports wagering; tax distributions go to the Gaming Proceeds Trust Fund for allocation to the General Fund, Education Trust Fund, and NIL Trust Fund (40%, 40%, 20% respectively).
• Prohibits wagering on high school sports or individual high school athletes; violators can face a $1,000,000 penalty per disallowed wager; requires reporting of large wagers and suspicious wagers.
• Creates the NIL Oversight Committee to regulate student-athlete NIL compensation, with members including education and school-organization leaders; meetings and ethics rules apply.
• Requires an annual NIL Certification Program for coaches, administrators, and student-athletes, including training on financial literacy, NIL regulations, and ethics; attendance required for NIL eligibility.
• Allows NIL compensation for student-athletes under state rules, with 50% of the compensation remitted to a state NIL Trust Fund to be held until certain conditions (graduation and/or 21st birthday and college enrollment) are met.
• Requires mandatory financial literacy and life-skills education before NIL funds are paid, and allows the NIL Oversight Committee to set fees and supervise administration of the NIL program.
• Establishes the NIL Trust Fund to receive NIL proceeds and fund distributions, certification programs, and oversight activities; funds may be used for student-athlete distributions and program administration.
• Imposes a state income tax exemption for certain NIL income earned by student-athletes if conditions are met (registered with the NIL Oversight Committee, contract approved, and compensation earned while active); applies to tax years 2025 through 2027.
• Effective date: October 1, 2025.

AI-generated summary using openai/gpt-5-nano on Feb 22, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Gaming