The House Economic Development and Tourism Committee approved the bill Wednesday. It now moves to the full House of Representatives. The proposal would authorize a state lottery played with paper tickets and video lottery terminals.
The Alabama Senate narrowly approved the bill last month.
The committee changed the bill to send some money to education programs. The substitute plan would send 75% of proceeds to the general fund and 25% to the education budget.
Rep. Steve Clouse has said he expects a close House vote. The bill faces a mixture of opposition from conservative lawmakers opposed to gambling and others who want to allow electronic gambling terminals.