Despite the slight slip month over month, December proved once again that Virginia sports betting is thriving.
For the fourth straight month, the total amount wagered exceeded half a billion dollars, with $633.2 million bet on sports in December. The total handle in the final month of 2023 was 25.9% larger year over year.
Seeing growth over 20% year over year is encouraging, but there is still more untapped potential residing in the Commonwealth. For now, betting on college sports is illegal. If bettors could place sports wagers on college sports, revenue could climb quite a bit higher. Virginia Sen. Schuyler T. VanValkenburg has introduced Senate Bill 124 to lift that ban — and it has already passed through its first subcommittee.
Sports betting handle was up 26% year over year in December
With over a dozen Virginia online sports betting operators, there is no shortage of choices for bettors. That wealth of options has helped sports betting gain popularity at a steady rate in the Commonwealth.
December saw $633.2 million of wagers placed between both online and retail wagers, which led to $569.6 million of winnings. After considering $1.9 million of bonuses and promotions as well as $4.5 million of other deductions, operators took home $57.2 million of Adjusted Gross Revenue (AGR). That meant operators combined for a total hold percentage of 10.05%.
The total handle in December was 25.9% better than in December 2022, when $503.1 million was wagered. The total AGR in December was also 17.8% better month over month.
There was a month-over-month fall. December saw a slight 1% dip in total handle compared to the $632.2 million of bets taken in November. That being said, November had a rough hold percentage of 6.73%. So despite the total handle being lower in December, revenue was 37.1% higher month over month.
As is the case in most markets with both online and retail sports betting, mobile sports wagers vastly outpaced retail bets. Of the $633.2 million of total handle, just $7.7 million came from retail bets, which is a minuscule 1.2%. The other nearly 99% were made up of mobile wagers. Retail sportsbooks generated $916,071 of AGR while $56.3 million of AGR was accumulated by mobile operators.
Virginia reaps $8.5 million in tax contribution from December sports wagering
The success enjoyed in December from sports wagering by operators led to the state reaping $8.5 million in tax dollars. That was 35.3% more taxes for the state month over month and 17.6% year over year.
In Virginia, the state places a 15% tax on sports betting AGR. Of that total, 97.5% is deposited into the Virginia General Fund. The remaining 2.5% goes into the Problem Gambling Treatment and Support Fund to counteract any problem gambling issues in the Commonwealth.
In December, the Virginia General Fund received $8.3 million of funds while the remaining $211,644 was set aside for the Problem Gambling Treatment and Support Fund Allocation.
Could the college sports betting ban be lifted to further boost revenue and tax contributions?
When Senate Bill 384 became a law and legalized sports betting in Virginia, it specifically prohibited betting on college sports and youth sports in the state. That ban extends to prop bets on those sports as well.
There is no denying that there are a lot of sports bettors in Virginia who deeply enjoy college sports and would want to wager on those games. March Madness is generally considered one of the major betting events in the sports betting world and Virginia bettors have no way to place bets on those games. Not having access to those wagers has put a glass ceiling on the Virginia sports betting market.
VanValkenburg, a Democrat who represents District 16 in the Richmond area, has filed Senate Bill 124 to remove that ban. The only catch is that it would not lift the ban on prop bets. So if this bill passed and became law, sports bettors could bet on college games, but not put money on prop bets. This is the second time VanValkenburg has attempted to pass such legislation.
The bill has already made it through the gaming subcommittee of the Senate General Law and Technologies Committee on January 24. The bill is now in the Senate Finance and Appropriations Committee.