With the approval last week of a sports betting bill, H7200A, by the Rhode Island legislature, it was signed by Governor Gina Raimondo as part of the state budget. The governor had anticipated this by already budgeting $23.5 million in the current budget. For that amount to be collected in taxes the industry would need to take in $900 million in bets.
The betting sites could be operating as soon as October 1.
The bill does not include language for an “integrity fee” that would benefit sports leagues such as Major League Baseball, and in fact specifically bans such a fee: “Under no circumstances shall the state or the division pay an integrity fee to any sports league.” In addition, it only authorizes land-based wagering, not mobile.
Under the bill the Rhode Island Lottery will administer sports betting in cooperation with the state’s two Twin River casinos, tentatively beginning October 1. Lawmakers contend that to extend sports wagering online or on mobile platforms would take a vote of the people.
The host communities, Lincoln and Tiverton, would each collect $100,000 annually for sports betting. The state will collect 51 percent, the vendor (most likely IGT since it was the only bidder for a sports wagering contract) will collect 32 percent and the casino itself will collect 17 percent. That 51 percent is the largest share of sports betting revenue of any state so far and could be a deal-killer.
Eric Ramsey of RK Forum, says he is skeptical that the state will collect that much taxes, noting that Nevada’s world-class, mature sports betting market collects $5 billion in wagers. He wrote, “Rhode Island can expect to take about one-fifth of Nevada’s wagering handle, but it’s hard to imagine numbers that rosy.”
A spokeswoman told the Providence Journal that the estimate was produced without input from Spectrum Gaming Group (which consults for the state.)
Add to that the fact that sports betting won’t immediately be available on mobile or internet platforms.
Other features of the bill are that bets on Rhode Island collegiate teams will not be accepted. A minimum age of 18 is set.
Delaware and New Jersey began offering sports betting this month. Nevada has had it for many years. West Virginia, Mississippi and Pennsylvania will soon offer it.
