Some States Not Seeing Expected Revenue From Legal Sports Betting
As the landscape for sports gambling in the U.S. continues to evolve, there is a "growing consensus that legal sports betting may not bring the windfall that economic forecasters predicted only a few months ago," according to Timothy Williams of the N.Y. TIMES. Since the SCOTUS' decision last May, just six states have "given final approval to allow legal sports betting." About a dozen states are "considering sports gambling bills," but lawmakers and gambling analysts note "only two or three of those states are likely to approve sports betting this legislative session, in part because of disappointing experiences in states where betting was recently made legal." West Virginia has "collected only one-fourth of the monthly tax revenue it projected." Pennsylvania and Mississippi have "received only about half of the tax revenue they had anticipated." Rhode Island had "assumed that sports betting would bring in" nearly $1M a month, but "only about $50,000 is coming in each month." New Jersey, however, has "been a bright spot." The state has brought in more than $2B "since sports betting was legalized about 10 months ago." The "vast majority of the bets there have come from smartphones or online, not allowed in most of the other states that have recently approved sports betting" (N.Y. TIMES, 4/17).
THREE'S COMPANY: In Pennsylvania, Keith Schweigert noted the popularity of the NCAA men's basketball tournament and the opening of two new sportsbooks in the state "led to monthly records for the number of bets and revenue in March." Pennsylvania’s $44.5M last month was the "largest in a single month outside of the country’s two largest legal sports betting jurisdictions, Nevada and New Jersey -- a sign that the state is emerging as the U.S.’s third-largest market." That figure is up 41% from $31.5M in February and up from $32M in January. The action generated $5.5M in revenue, up from $1.9M in February and $2.6M in January. The record month injected just under $2M into "state government coffers, up from $700,854 in February" (FOX43.com, 4/16).
SUNSHINE PROPOSITION: In Florida, Dara Kam noted sports betting is "on the table" in the state as Sen. Wilton Simpson "tries to nail down a gambling deal with the Seminole Tribe of Florida as early as Friday." An "alluring perk" for the pari-mutuels, a form of pool betting that does not use fixed odds, would allow sports betting at "dog tracks, horse tracks and jai-alai frontons, as well as professional sports arenas." Sources said that the Seminoles "would serve as a 'hub' for sports betting, meaning they would get a cut of the bets being made outside of their facilities, while being allowed to run sports books at their own casinos." However, sports betting "may not be enough to satisfy" the pari-mutuel operators (NEWS SERVICE OF FLORIDA, 4/15).
A CLOSER LOOK: This week's SPORTS BUSINESS JOURNAL takes an in depth look at the sports betting landscape and highlights the varying approaches states are taking, the use of official league data and the DOJ’s interpretation of the Wire Act.