Iowa Sports Betting Bill Heading To Governor For Approval After Contentious Debate

On Monday in Des Moines, the Iowa House of Representatives passed a sports betting bill, sending it to the governor for a signature.
Iowa House

Late on Monday in Des Moines, the Iowa House of Representatives voted 67-31 to pass a sports betting and fantasy sports bill, the week after the Senate approved its companion measure.

Sports betting in Iowa will head to Gov. Kim Reynolds, a Republican. The bipartisan measure that allows statewide mobile betting was spearheaded by Republicans. Reynolds’ signature looks to be a betting favorite, as she said in February that sports betting “needs to be regulated.” Proponents of sports betting in Iowa are “cautiously optimistic” about Reynolds’ approval. Gambling bills are rarely sure things.

Her signature could come before the end of April. There’s no precise timeline for Reynolds’ stamp of approval. Iowa plans to have retail sports betting by the upcoming NFL and college football seasons. The Hawkeye State has 19 casinos eligible for sports wagering.

Iowa considered sports betting legislation in 2018, but efforts then were unsuccessful. The debate this year included several sports betting bills, with the plan supported by the casino industry as the last one standing. A bill backed by the pro sports leagues didn’t gain enough traction.

Leagues strike out in ninth amid fiery debate

A proposed amendment for requiring Iowa casinos to use “official league data” for sports wagering was withdrawn on Monday evening. It was a last-ditch effort to include the controversial provisions.

State Rep. Bobby Kaufmann, a Republican backer of the legislation, defended his bill on Monday evening against a claim that Iowa was moving too quickly on the sports betting issue.

“With all due respect, in no universe has this been rushed,” Kaufmann said. “We had five subcommittees on five different bills, and I listened to everyone involved.”

The roughly 90-minute debate Monday was contentious at times.

“I rarely make closing comments on a bill, but after putting in over 400 hours [on this bill], I am at least going to spend a couple of minutes giving some thanks,” Kaufmann said ahead of the vote.

Kaufmann added that since December he didn’t go a “half a day” without talking about sports betting.

“I think we are kidding ourselves if we think we can make this [illegal sports betting] go away [without regulation],” Kaufmann said. “Doing nothing is not an option. Sticking our head in the sand is not an option. Hoping that people get help when they are placing bets in dark alleys with bookies whose collection method is a threat to kneecap you isn’t good for anybody.”

The kneecapping comment appeared tongue-in-cheek.

The numbers

Iowa is projected to eventually have more than $4 billion in annual sports wagers, under statewide mobile betting and its 6.75% state tax rate, according to a 2017 Oxford Economics study.

Iowa is poised to capture much of the latent Nebraska sports betting market. Nebraska, which is unlikely to legalize sports wagering within the next five years, already sees its residents spend more than $300 mm annually on gambling in Iowa, a figure that will only swell with sportsbooks across the state line.

Iowa’s casino industry won $1.46 billion from gamblers in 2018, up a mere 0.3% over 2017, according to data from the University of Nevada Las Vegas’ Center for Gaming Research. Based on the handle projection, Iowa could, down the road, see more than $200 mm in annual sports wagering revenue.


The Prairie Meadows casino-hotel, which partnered with British bookmaker William Hill in January, is expected to be the state’s first sportsbook in operation.

Ahead of Monday’s House vote, Australian online sportsbook PointsBet, which already does business in the competitive New Jersey market, announced a partnership with the Catfish Bend Casino. The deal is for both retail and online betting.

Leading New Jersey online bookmakers DraftKings and FanDuel both supported the Iowa legislation. Neither company yet has a sports wagering partnership in Iowa.

Online gaming bill likely on horizon

Internet sports betting is a natural segue into other forms of regulated online gaming, which Iowa has strongly considered in the past. From around 2011 to 2013, the state took a hard look at online poker.

Iowa found that it could it generate as much as $13 mm in annual tax revenue from online poker, a figure not far from what it is currently looking to capture from legal sports wagering. Online poker is not as popular as it was back then, so Iowa is unlikely to pass or even consider an online poker-only bill.

A much more likely scenario is that after mobile sports wagering launches and starts growing the state’s gaming market, other forms of internet betting will be considered.

Highlights of Iowa’s sports betting bill

Mobile Betting? Yes

In-person registration required? Yes, until Jan. 1, 2021

Tax rate: 7.5% effective (6.75% state tax)

Application fee: $45k, with $10k annual renewal

Legal to bet on college games?: Yes, but no college props

Fee to pro leagues: No

Use of “official league data” mandated?: No

Regulatory body: Iowa Racing and Gaming Commission

Where the money goes: General Fund, Sports Wagering Receipts Fund


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