Virginia Wagers Nearly $60M in First Days of Legal Sports BettingLegal
It didn't take long for Virginia sports bettors to place their bets.
In just the first 11 days of legal sports betting in Virginia, sportsbook operators reported taking $58.89 million in total bets. In less than two weeks, sports betting has proven popular in Virginia, where there are currently five licensed sportsbook operators.
The sportsbooks reported that they took an early loss in the stretch of 11 days, but only because they were offering $6.3 million in various promotional incentives to try to gain a strong market share. In terms of the wagers themselves, gamblers won $55.31 million on the nearly $60 million they wagered in total.
The numbers released by the Virginia Lottery this week don't include the NFL's Super Bowl, which was expected to bring a huge windfall of gambling action to the state.
Where the Betting Market Stands
As of the first week in March, there are only four sportsbook operators that have obtained a license to fully operate and offer sports wagering in Virginia. However, the state's lottery board said it expects to award additional sportsbook operator permits "in the coming days."
The Virginia Lottery said there are at least 12 applications that are pending from companies that want to enter Virginia's sports betting market.
The first company that entered the commonwealth was FanDuel, which launched its sportsbook on January 21.
Virginia is a potential hotbed for sports betting companies. Much of that is due to the wealthy regions in the northern part of the state. A lot of residents live there and commute into Washington, D.C., to work for the government or high-profile private companies.
It's likely to result in a lot of wagering activity, which has therefore attracted the attention of a lot of sports betting operators.
What It Means to the State
Virginia set its tax rate at 15% for all sports betting revenue brought in by the operators. However, the companies are allowed to subtract from their total any promotional offers.
As a result, the net taxes that were paid from sportsbook operators to Virginia in January only reached $39,710.31. That isn't much at all, obviously, but lawmakers in Virginia also expected that in the beginning.
Short-term projections from the Virginia Lottery included the likelihood that sportsbook operators would be running a lot of promotions upfront to try to attract as many customers as possible. And that's exactly what happened.
FanDuel alone, for example, paid out a large $1.5 million in total promotional winnings during just one of their events. During the "Spread the Love" event, gamblers essentially got a free win. FanDuel allowed all gamblers to place a wager on the Washington Wizards game and add more than 100 points to the team's final score.
While it's all but a guarantee that those wagers would be a win for the gamblers, it's often worth it to companies such as FanDuel. The free win brings bettors into their site, and FanDuel hopes they stay for more.
Virginia lawmakers are projecting that the promotional offers will even out over time, and that much more tax revenue will be brought into the state eventually.
The General Assembly this year clarified some questions regarding their initial sports betting law through new legislation earlier this year. Virginia has a limit of 12 licenses for sports betting, but that won't apply to any brick-and-mortar casinos that are in the state.
In addition, companies will now be able to accept wagers on the Olympics, which were previously banned under the original law. The governor of Virginia, Ralph Northam, is expected to sign those additions to the legislation into law.
The next big sporting event on the horizon is the NCAA's March Madness men's college basketball tournament. It's one of the biggest sporting events of the year, and typically attracts loads of betting attention.
It's something that Virginia hopes will bring in even more sports betting action, especially if more operators are approved for licenses by then.