Less than two months into the legal Kentucky sports betting era, the rollout is already starting to have a massive economical impact on both The Bluegrass State itself and surrounding states.
The first part of this is a no-brainer. States tend to rake in money when they first debut gambling. There is no exception for sports betting in Kentucky. In some ways, they are reaping the benefits from the best of both worlds.
On the one hand, getting to bet on sports in Kentucky is a novelty. It’s new. Residents couldn’t previously head to a retail location or place wagers with onlines sportsbooks in the United States. This newness drives heightened interest that usually takes a great deal of time to level off, if it ever does.
On the other hand, horse racing betting in Kentucky has been legal for a while. Residents have, in this way, already received a taste of the action. They are familiar with the sports betting process in some form. That means they’re less likely to be intimidated or uninformed when it comes to signing up with gambling operators. It also means plenty of people don’t even need to sign up for Kentucky sports betting accounts. They already have them with race tracks. And many of those tracks offer both general retail wagering as well as Kentucky sports betting app options.
But just how much of an impact is sports gambling in Kentucky having on the economy? And moreover, how and why are neighboring states feeling the impact of the most recent sports betting launch in the United States?
Opening Kentucky Sports Betting Revenue Is Not Yet Etched in Stone, But It’s Tracking in the Right Direction
Kentucky sports betting has yet to be live long enough for official tax-revenue numbers to be mined and then released. However, the initial sports betting handle figures—i.e. the total amount of money wagered with Kentucky sportsbook—are officially in the books. And they’re pretty impressive.
As Samantha Valentino wrote for WKYT in Kentucky:
Last week, Governor [Andy] Beshear announced that nearly $448 million has been wagered since sports betting began in Kentucky. ‘That means dollars will stay right here to help us build a better commonwealth for all our families. Whatever team you’re betting on, it’s a win for Team Kentucky,’ said Beshear. Robert Linnehan is a sports betting regulatory expert and editor of Sports Betting Dime. He says $448 million is a good base to go off of, but what we don’t know yet is how much of that money will actually benefit the state. ‘You say, ‘Wow, this state’s got to be making money hand over fist.’ But sports betting taxes, you know you’re not taxing [the] handle. You’re taxing gross gaming revenue. You’re taxing the revenue that’s coming in with the operators without knowing what revenues the operators are posting what they’re reporting. We have no idea what Kentucky is making in taxes.’”
Linnehan’s sentiments are accurate. Depending on how many winning wagers Kentucky sports betting sites needed to pay out, the state’s tax revenue could be relatively modest.
We also need to factor into potential exemptions. Most states allow sportsbooks to write off transactions used with deposit bonuses and other promotions. And these specials tend to be most aggressive and plentiful during the inaugural months of a state’s sports wagering.
Other States are Feeling the Impact of Sports Betting Going Live in Kentucky
With that said, the overall handle is a good gauge of general interest in Kentucky sports betting. Flirting with a half-billion dollar handle compares to other state launches with similar population sizes. Perhaps this won’t result in a short-term windfall. But it does bode well for the longer term.
Also a good gauge for the success of Kentucky sports betting: The drain this launch is having on surrounding states. Places like Indiana, Ohio, Illinois and West Virginia all border The Bluegrass State.
They also all have legalized sports betting in some form. Kentucky officials have noted in the past that state residents were no doubt traveling to place wagers in those regions. That’s why Governor Beshear made it a point to say that Kentucky sports betting dollars “will stay right here.”
Indiana is Feeling Kentucky Sports Betting More Than Any Other State (So Far)
These shifting market dynamics are most evident when looking at sports betting in Indiana.
Both they and Ohio are the largest connecting states to Kentucky. But while The Buckeye State is such a large market they won’t feel the change. But Indiana is reportedly already feeling the squeeze.
“You’re not seeing people leave Kentucky every weekend to go bet on college football or the NFL like you were seeing in years past,” Linnehan explained. And as Valentino added: “Particularly Indiana, as the state borders Louisville, Kentucky’s largest city. Last month, Indiana saw a handle of $429,673,062. That’s a slight drop from the state’s handle in October of last year, $446,248,394. Caesars Southern Indiana, just across the river from Louisville, saw a $2,901,972 handle drop this month compared to October 2022.”
Granted, these differences might seem negligible. And in the grand scheme of Indiana sports betting, the handle drops are not necessarily evidence of anything sinister.
But they are proof that the launch of sports betting in Kentucky is already appealing to many within the market. We still need to wait for the opening-month Kentucky sports betting handle to be reported before declaring the state fit for a victory lap. Yet, no matter what the initial tax revenue is, the obviously shifting market dynamics speak volumes.
And they’re saying that the future of sports betting in Kentucky is pretty freaking bright.
Take a look at this list of the top online sportsbooks so you can find one that works for all of your sports betting needs:
Online Sports Betting © 2024