Bettors wagered nearly $59 million at licensed sportsbooks during the first 11 days of legal sports betting in Virginia.
The Virginia Lottery, which oversees the commonwealth’s new sportsbook industry, released wagering figures for January on Monday.
VA sports bettors tallied $58,896,564 in wagers (the monthly “handle“) in just one-third of a month and with a limited number of operators. That figure extrapolates to more than $160 million for a full 30-day period.
Only neighboring Tennessee, which drew $131.4 million in bets in the 30 days after launching on Nov. 1, generated more than Virginia in its debut month. However, Virginia topped Tennessee’s per-day total.
That bodes well for future months in Virginia, including February, which will include Super Bowl betting in its monthly reporting figures.
VA sports betting handle and hold for January
Of the nearly $59 million wagered in January, sportsbooks paid out $55,310,487. That created a “hold” of 6.08% ($3,586,077) for the sportsbooks. This is a little lower than the industry average, but well within the norm.
Additional sportsbooks are expected to launch soon. In fact, VA Lottery officials said they plan to issue additional permits “in the coming days.”
By market maturity, PlayVirginia expects Virginia’s sports-betting handle to grow $5 billion in annual bets.
Bonuses and promotions impacted the bottom line
State law dictates a 15% tax on sports betting revenue. However, Virginia taxes the adjusted gross receipts (AGR), not the gross gaming revenue (GGR).
AGR is defined as total wagers minus total winnings and other authorized expenses, namely the value of player bonuses and other customer-acquisition promotions. It is unclear if the federal excise tax of .25% is included in the expenses column.
Here is a look at the full breakdown of numbers:
|Month||Handle||GGR||Hold %||Bonuses and promos||Other deductions||AGR||Taxes|
Sportsbooks invest heavily in bonuses and promos for players, especially during a launch in a new market. In fact, three of four operators reported a negative AGR, and the combined AGR was a $3.2 million loss.
However, as VA Lottery officials noted, that number will “decline considerably … to a more sustainable level” as the market matures.
Where VA sports betting taxes go
Virginia lawmakers and other stakeholders sold sports betting as a way to raise revenue.
According to the legislation, 97.5% of the taxed hold is to be deposited in the state’s General Fund.
The other 2.5% is transferred to the Problem Gambling Treatment and Support Fund, which the Virginia Department of Behavioral Health administers.
Because of the negative AGR, Virginia’s take took a hit for January. The lottery reported only one sportsbook reported a taxable profit, which is reflected here::
- Total tax: $39,710.31
- General Fund: $38,717.55
- Problem Gambling Treatment and Support Fund: $992.76
More Virginia sportsbooks to launch
Two bills could soon expand the number of Virginia sportsbook operators.
Notably, the bills would clarify that mobile sports betting licenses for soon-to-launch Virginia casinos won’t count against the cap of 12 mobile-only licenses.
Additionally, for the 10 remaining only-online licenses, VA lawmakers would give “substantial and preferred consideration” to sportsbook operators with minority participation.