Legalized sports betting earned a green light from the Virginia General Assembly in April 2020. It opened the door for legal and regulated sportsbooks in the state.
Virginia sportsbooks took the first bets in January 2021. But, there was a catch.
The same in-state college sports that fill Virginia stadiums and arenas aren’t Virginia betting options as of now.
That’s bad news in a state known for bowl game appearances. Not to mention March Madness runs.
So, the ban hits especially hard here. After all, Virginia doesn’t have any professional sports teams. A lot of the area’s sports culture is tied to college games.
That also means fans of Virginia college sports leave town to bet.
They have plenty of options between the Smoky Mountains and the Eastern Seaboard.
Five states and Washington, DC, share a border with Virginia. And, five of those six locales offer legal sports betting or soon will. None of the neighbors have the college betting restriction, by the way.
Virginia’s ban on in-state college betting
The ban hindered the Virginia sports betting market when the first operators came online, but it could have been far worse.
Some lawmakers initially wanted a total ban on college sports bets. Legislators struck a compromise, however. The middle ground left Virginia residents and guests with bets on out-of-state college games at least. But it leaves out bets on the University of Virginia and Virginia Tech.
Additionally, VA’s restrictions include a ban on all college prop bets, including schools both inside and outside of Virginia state lines. In other words, the Virginia sportsbooks can’t offer prop bets at the college level — no matter where the team or player is based.
Betting on the high scorer in the Duke-North Carolina game isn’t the only limit, either. Olympic games bets are banned in Virginia. Bets on youth sports are also prohibited.
Virginia is for betting tourism in other states?
If in-state bettors want to wager on the Cavaliers or Hokies, or any of Virginia’s 12 other Division I collegiate programs, they’ll have to take their gambling dollars to another state.
As we’ve said, the list of affected in-state programs includes both UVa and Virginia Tech, as well as Liberty University and Old Dominion University. All four schools are bowl contenders because they reside in the top-level Football Bowl Subdivision (FBS).
Talk about March Madness: Virginia’s numerous Division I basketball programs are also affected.
- George Mason University
- Virginia Commonwealth University (VCU)
- Hampton University
- James Madison University
- Longwood University
- Norfolk State University
- Radford University
- University of Richmond
- Virginia Military Institute
- College of William & Mary
Here’s some good news at least. Virginia’s collegiate betting ban does not apply to events involving Virginia teams if out-of-state college teams are also competing.
If, for example, a collegiate basketball tournament game takes place within Virginia’s borders, bettors can wager on the matchups even if they involve VA schools. It’s safe to assume this is an NCAA Tournament loophole.
Why do states ban college sports betting?
Bettors may wonder why states would cut off one of the most popular sports betting options within their borders. And, why would they pass up that guaranteed tax revenue?
The pressure on lawmakers usually comes from colleges and university representatives. The message comes through using media interviews and public comment periods.
These athletic directors, coaches, compliance officers and other university officials will often cite two reasons for the proposed ban:
- Maintaining the integrity of collegiate athletics.
- Protecting students and student-athletes from gambling.
However, the arguments and restrictions are often little more than window-dressing.
To be fair, some delegates or senators don’t need to be lobbied because they already oppose gambling on principle.
Facts and myths about college betting bans
Policymakers express a lot of concerns. But, there’s one straightforward fact when it comes to sports betting integrity: The best way to root out corruption is with a large, legal and regulated market.
Nearly every major betting scandal was snuffed out by regulated operators.
Regulators and legal sportsbook operators can better monitor the industry by pulling betting dollars out of illicit markets. They have the resources to quickly flag any potential attempts to illegally affect betting outcomes.
Additionally, such bans rarely, if ever, curb betting. Bettors will often turn to markets – legal or illegal – where they can find what they want.
The US Supreme Court has weighed in
The US Supreme Court struck down the Professional and Amateur Sports Protection Act (PASPA) in 2018.
That landmark court decision opened the door for nationwide sports betting. It also ended the multibillion-dollar offshore, unregulated sport betting industry. Legal domestic wagering options became a better alternative.
Now, it’s easier to identify and help problem gamblers and ensure that minors aren’t wagering.
In the world of sports betting, transparency is the key to a safe market. You get it only with regulated sports betting operators.
VA’s lost revenue due to the college betting ban
Just how much revenue does Virginia lose because of its in-state ban on sports betting?
It’s hard to know for sure. But, revenue figures from other states can give us some clues.
A conservative estimate would put annual wagering on in-state colleges and universities at about $25 million.
On average, the industry would keep about 7% of that handle as revenue. With the 15% tax on sports betting revenue in Virginia, the state loses about $275,000 in revenue per year.
Wrapping up: VA sports betting could be better, could be worse
Virginia did a lot of things right as it laid the foundation for legal sports betting.
The state is operator-friendly so a wide range of sportsbooks compete for bets. By restricting the ability to bet on Virginia college games, the state’s bettors take their money to other markets though.
Or, perhaps, they never place a bet at all. It’s something the state could have avoided.
The ban tried to fix a problem that doesn’t exist. The market and the Virginia tax base take a hit because of it.