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May 4, 2022 HB 22-1412
Legislative Council Staff
Nonpartisan Services for Colorado’s Legislature
Revised Fiscal Note
(replaces fiscal note dated April 29, 2022)
Drafting Number:
Prime Sponsors:
LLS 22-0314
Rep. Garnett; Van Winkle
Date:
Bill Status:
Fiscal Analyst:
May 4, 2022
House Finance
Anna Gerstle | 303-866-4375
Anna.Gerstle@state.co.us
Bill Topic: SUNSET DIVISION OF GAMING
Summary of
Fiscal Impact:
☒ State Revenue
☒ State Expenditure
☐ State Transfer
☐ TABOR Refund
☐ Local Government
☐ Statutory Public Entity
Sunset Bill. This bill continues the Division of Gaming in the Department of Revenue,
which is scheduled to repeal on September 1, 2022. State fiscal impacts include a
minimal revenue and workload impact from changes to the program under the bill, as
well as the continuation of the program's current revenue and expenditures. The
Division of Gaming is continued through 2033.
Appropriation
Summary:
No appropriation is required.
Fiscal Note
Status:
The revised fiscal note reflects the introduced bill, as amended by House Business
Affairs and Labor Committee.
Table 1
State Fiscal Impacts Under HB 22-1412
1
New Impacts
Budget Year
FY 2022-23
Out Year
FY 2023-24
Revenue - -
Expenditures - -
Other Budget Impacts - -
Continuing Impacts
Revenue Cash Funds
2
- $183,507,515
Expenditures Cash Funds - $20,632,177
Continuing FTE - 120.5 FTE
Other Budget Impacts TABOR Refund - -
1
Table 1 shows the new impacts from changes under the bill and the continuing impacts from extending the program
beyond its current repeal date. Because the bill continues a program with minor changes, there are no new impacts.
The continuing program impacts may end if the bill is not passed and the program is allowed to repeal.
2
This amount includes gaming and sports betting tax revenue, as well as administrative fees and fines. Page 2
May 4, 2022 HB 22-1412
Summary of Legislation
Under current law, the Division of Gaming (division) in the Department of Revenue (DOR) repeals
September 1, 2022. This bill includes the recommendations of the sunset review completed by the
Department of Regulatory Agencies, which include the following:
continuing the division until September 1, 2033;
allowing the Limited Gaming Control Commission, at its discretion, to delegate licensing duties
to the division;
lowering the age requirement to work in a casino from 21 years old to 18 years old;
clarifying that the Fantasy Contests Act uses the DOR’s Hearings Division to conduct hearings for
violations;
repealing the requirement that applicants for sports betting licenses whose primary residences are
located outside of the United States submit to a fingerprint-based criminal history record check,
unless required to do so by the commission;
requiring that sports betting winnings be subject to the Gambling Payment Intercept Act; and
allowing the commission to determine whether unlicensed sports betting or limiting gaming is
occurring in any city or county in the state, and prohibiting sports betting or games authorized as
limiting gaming to the public without a license.
The bill also repeals the prohibition on people under the age of 21 lingering or sitting in the gaming
area of a casino, and modifies the penalties for violating underage prohibitions. Currently, the penalty
is a class 2 misdemeanor; under the bill, there is a civil penalty of $500 or $1,000 for a first or second
offense, respectively, and a class 2 misdemeanor for a third or subsequent offense.
Background
Division of Gaming. The Limited Gaming Control Commission and the Division of Gaming regulate
casino gambling in Central City, Black Hawk, and Cripple Creek, and sports betting that occurs in
licensed casinos and on internet platforms that contract with a licensed casino. The division also
regulates fantasy sports contents. The sunset report completed by the Department of Regulatory
Agencies can be found here:
https://drive.google.com/file/d/1CtzowSNOryiR6mHPVI7Vy7HMCH_G4_wA/view
Gambling Payment Intercept Act. The Gambling Payment Intercept Act requires the DOR to
maintain, or contract with a vendor to maintain, a registry of individuals who owe unpaid child
support, criminal restitution, and/or unpaid debt to the state. Prior to paying a winner, a licensee
must check whether the winner is on the registry and if, listed, withhold the amount owed and send
it to the DOR or the vendor, to be distributed to the applicable state agency. Page 3
May 4, 2022 HB 22-1412
Comparable Crime Analysis
Legislative Council Staff is required to include certain information in the fiscal note for any bill that
creates a new crime, changes the classification of an existing crime, or creates a new factual basis for
an existing crime. This section outlines data on crimes comparable to the offense in this bill and
discusses assumptions on future rates of criminal conviction for those offense.
Prior conviction data and assumptions. The bill changes the class 2 misdemeanor for underage
gaming or permitting underage gaming so that it is applied to the third or subsequent violation only.
From FY 2018-19 to FY 2020-21, zero offenders have been sentenced and convicted for this offense;
therefore, the fiscal note assumes that there will continue to be minimal or no additional criminal case
filings or convictions for this offense under the bill. Because the bill is not expected to have a tangible
impact on criminal justice-related revenue or expenditures at the state or local levels, these potential
impacts are not discussed further in this fiscal note. Visit leg.colorado.gov/fiscalnotes for more
information about criminal justice costs in fiscal notes.
Continuing Program Impacts
Revenue. Based on the department's projections for FY 2022-23, the division is expected to collect
$183.5 million in revenue, which includes gaming and sports betting tax revenue, fines, and licensing
and operation fees. If this bill is enacted, this revenue will continue starting in FY 2023-24. If the bill
is not enacted, some portion of the amount in Table 1 would no longer be collected. Because the
Colorado Constitution gives authority to the Limited Gaming Control Commission to regulate limited
gaming, and portions of state law concerning some aspects of gaming are located in other sections of
statute, this amount cannot be estimated. This fiscal note will be updated if more information becomes
available. Licensing fees and other service revenue is subject to TABOR, while certain tax revenue is
exempt from TABOR.
Expenditures. Based on the department's projections for FY 2022-23, the DOR is expected to have
expenditures of $20.6 million for the Division of Gaming. If this bill is enacted, current expenditures
will continue for the program starting in FY 2023-24. If this bill is not enacted, the program will end
on September 1, 2023, following a wind-down period, and state expenditures will decrease starting in
FY 2023 24 by the amounts shown in Table 1.
The changes to the program that drive additional revenue and costs are discussed in the State Revenue
and State Expenditures sections below.
State Revenue
The bill may increase revenue from civil penalties and background check fees, as discussed below.
Civil penalties. The bill may increase General Fund revenue from civil penalties paid for violations
of the prohibition on underage gaming. The penalty is $500 for a first offense and $1,000 for a second
offense. The fiscal note assumes that this revenue will be minimal.
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May 4, 2022 HB 22-1412
Background checks. The bill may increase revenue to the Department of Public Safety by a minimal
amount if there is a change in the number of criminal history record checks completed. Additional
checks for potential employees between the ages of 18 and 21 will increase workload, which may be
offset by fewer checks completed for internationally based applicants. The fee for a check is $39.50
per check, of which $28.25 per check is subject to TABOR. The revenue impact is expected to be
minimal.
State Expenditures
The bill increases workload for the Division of Gaming to process additional operator license
applications from people between the ages of 18 and 21, modify the Gambling Payment Intercept Act,
update materials, and conduct any enforcement the commission deems necessary for unlicensed
gambling. Some of the increase may be offset by a reduction in workload from collecting fingerprints
from internationally based applicants. No new appropriations are required.
Effective Date
The bill takes effect September 1, 2022, assuming no referendum petition is filed.
State and Local Government Contacts
Personnel Public Safety Revenue
The revenue and expenditure impacts in this fiscal note represent changes from current law under the bill for each
fiscal year. For additional information about fiscal notes, please visit: .