Tennessee Sports Betting Explodes, as Regulatory Agency ChangesTennessee
Tennessee's sports betting market is off to a tremendous start, just as the state is switching how it will regulate the practice.
The Volunteer State brought in a solid sports betting handle in the first six months of operation, which resulted in a windfall of new tax revenue that will help education and other needs throughout the state.
At the same time, the state is about to transition from one agency to the next in terms of who regulates the sports betting market in the state. It's a unique take for a state such as Tennessee, which at first handed the regulatory reigns to its state-run lottery.
Now, with a new, independent panel set to take over, sports betting could take off even more in Tennessee.
Mobile Betting Drives Revenue
Tennessee is one state that, right out of the gate, allowed sports betting to happen on mobile devices. This expanded the reach of sports betting within the state, rather than restrict it to land-based, in-person retail sportsbooks as some states have done.
This was especially important during the pandemic, which limited the movement and gathering of people at indoor locations. Mobile betting has helped drive sports betting in many states during the pandemic.
The Tennessee Lottery, the agency that was initially put in charge of regulating sports betting, reported recently that in just the first six months of operation, the state has brought in a gross handle of more than $1 billion.
In April alone, sportsbooks garnered $172 million in gross handle, which resulted in $2.8 million in tax revenue for the state. That tax revenue is put to good use, too, with 80% put in an education account that primarily funds post-secondary scholarships, according to the Associated Press.
The remaining is split between needs of local governments (15%) and gambling problem treatment programs (5%). That's a significant amount of extra money that can be put toward exceptional programs.
Right now, Tennessee has seven sportsbooks that are operating and offering bets in the state. Sports betting first opened in Tennessee back on November 1.
A Switch in Regulation
Since the beginning, the Tennessee Lottery has been the agency in charge of regulating the sports betting industry in Tennessee. Now, though, that is all about to change.
The state House and Senate have both passed bills that will take regulation out of the hands of the Tennessee Education Lottery Corporation, and hand it over to a new Sports Wagering Advisory Council, which is made up of nine members.
The bill is just awaiting the signature of Governor Bill Lee before it can officially change Tennessee's sports betting laws.
While it's not official yet, the TELC has already begun the process of handing over regulation to the SWAC.
Before the end of 2021, the new group will hire staff and an executive director, lease office space to work in, and also develop new regulations related to sports betting -- if they see any that should be enacted.
In that timeframe, the TELC would help the SWAC do whatever it needs over the next seven months. That being said, sports betting has already become so big in Tennessee that the TELC's director, Rebecca Hargrove, said the group can't continue to oversee the market with its current staff.
That should actually be good news for people in Tennessee, because it means sports betting has really taken off so quickly. While it will also put a lot of pressure on the new SWAC to get up and running as quickly and efficiently as possible, it does show the amazing potential sports betting has in the state.
Hopefully, the change in regulatory authority won't hold up pending applications for new sportsbook operators in Tennessee. Licensed sportsbooks has already increased from four to seven, and there are many more waiting approval.