- Legal States
Eva Ivanova June 21, 2021 3 min read
D.C. Reports Staggeringly Low Sports Betting Revenue
D.C. could soon see unexpectedly low sports betting tax revenue as every year the officials revise down their revenue projections since the legalization of sports gambling in 2020.
D.C. Council Dazzled by the Low Revenue from Sports Betting
The D.C. Council Committee on Business and Economic Development held a budget oversight hearing on Thursday where officials discussed the fiscal year revenue and future projections. Lottery officials reported around $230,000 in revenues for the first three quarters of the year. The D.C. Council voted for the legalization of sports wagering in 2018, with the hopes of getting tax revenue of millions of dollars, but it would take two years for sports gambling to develop. Every year, the revenue projections were trimmed up by start-up costs, legal issues, and the pandemic in the past year. D.C.’s most recent sports betting revenue projections were more than $6 million and for the next fiscal year – triple that.
D.C. Lottery’s general counsel, Ridgely Bennett, said that this fiscal year has been difficult due to COVID restrictions. He said that there are hopes that the next fiscal year could be significantly better once retail-based sports betting becomes operational. He stated that many people prefer to pay cash. They don’t want to go through the verification process for setting up online mobile accounts and give out their bank information details and Social Security numbers. This has proven true only for D.C.
During the hearing, councilman and committee chair Kenyan McDuffie said that the city would earn more tax revenue with more mobile competition. In other places where mobile sports wagering is legal, including New Jersey and Las Vegas, it is going strong. In April alone, Virginia’s competitive mobile betting generated over $1 million in tax revenue.
GambetDC generated a third of William Hill’s betting handle
According to Bennett, more people would go to William Hill’s land-based betting venue at Capital One Arena or use its app because it is an established brand and GambetDC is not. During this fiscal year so far, William Hill’s sports wagering handle is $92 million. According to Bennett, its tax revenue was $1.044 million. William Hill, because of how the D.C. Council structured the sports gambling agreements to favor GambetDC, requires bettors to be either at Capital One Arena physically and pay with cash or in venues within two blocks where they can use its mobile app. Recently BetMGM has done the same in the area of Nationals Park. GambetDC allows its users to use the app without the two-block exclusion. However, it still reported only a third amount of the handle. William Hill had $60 million more money wagered than GambetDC.
Bennett said that the city’s built-in advantages would pay off beginning later this calendar year. He stated: “Just like the rest of the entertainment industry in the District, we’re cautiously optimistic.”
However, McDuffie stated that he is less confident as he continues to delve into the matter.
Eva is a PR specialist and communications expert with ten years of experience in campaign organizing and creative writing. She is also a published author of fictional stories. Eva recently developed an interest in economics and the gaming industry after discovering the inspirational story of Molly Bloom.
Industry June 21, 2021