- The state accounted for $24 million in their yearly budget from sports betting revenue.
- After three full months, state revenue stands just above $150,000.
- Mobile betting is expected to launch in the upcoming weeks.
PROVIDENCE, R.I. – Though the state of Rhode Island has been falling well short of sports betting revenue projections, there may be a simple reason why.
Governor Gina Raimondo and her administration projected for $17.1 million more in revenue for the first year of operation than was projected by the American Gaming Association.
Whether it was a miscalculation, an error to read the AGA’s 2017 projections, or the belief that the state could “hit the over”, it is now clear why the sports betting revenue for Rhode Island in on track to hit just 2.5% of the budgeted funds for the year.
In the timeframe where the majority of bets are made from US players, Rhode Island sportsbooks watched their handle grow to $53.5 million in the first three full operating months. However, only $300,000 was kept by the books in that timespan, leaving $153,135.15 for the state collected from their 51% sports betting tax
The report, which suggested that in a “limited availability” “high tax rate” “fully developed market” scenario, Rhode Island would be able to see $6.4 million enter the state – much less than the $24 million that was approved in the state’s budget.
It also set the stipulations that wagering would not have any restrictions. As Rhode Island sports bettors know, you are unable to bet on college athletic teams that are located in Rhode Island, regardless of where they are playing.
Some are looking for soon-to-launch mobile betting to help the cause but, according to the SVP of Public Affairs at the AGA, Sara Slane, the launch of mobile betting will only slightly boost revenue for the state.
Either way, the state has much ground to make up to fund the many programs and operations slated in the budget.
Add in the possible addition of SB 382, which would see a $100,000 increase on the annual flat fee given to the cities from the casinos for hosting the industry, and the sports betting scene in Rhode Island is even further in trouble.
It still raises the question as to why such a pro-gambling governor could be so off on sports betting in Rhode Island expectations. Not only has she seen thousands of dollars funding the National Governors Association from gambling entities, but she has also received money for her inauguration from Twin River and IGT.
Last year, Raimondo also named Don Sweitzer the Treasurer of the Democratic Governors Association. Sweitzer is the chairman of IGT Global Solutions.
Her strong connections to the gambling industry proved her desire to make Rhode Island one of the first states to offer single-game wagering, but at what cost?
Government officials estimate that the budget will be short by $40 million over the next two years, which is being held responsible by the lack of revenue from sports betting.