The state of Iowa is moving full steam ahead toward launching in-person sports betting ahead of Week 1 of the upcoming NFL season and the beginning of college football, the start of the busiest time of year for any legal and regulated sportsbook in the country.
The Iowa Racing and Gaming Commission will meet Tuesday in Des Moines to award 18 sports betting licenses to casinos in the state, according to the IRGC’s meeting agenda. According to The Gazette newspaper out of Cedar Rapids, regulators in the state are eyeing an Aug. 15 opening date for brick-and-mortar sportsbooks. It’s not clear how many could open that day.
Construction on brick-and-mortar books is currently ongoing at many of the state’s casinos.
A report from Radio Iowa indicates that the Aug. 15 date is by no means set in stone. IRGC administrator Brian Ohorilko told Radio Iowa that sports betting will kick off “no earlier than on Aug. 15 at noon.” He indicated that there will be a staggered opening of books ahead of the start of the NFL season.
The IRGC is also expected to approve emergency rules for sports betting at Tuesday’s meeting. The emergency status allows state officials to fast-track the launch of sportsbooks.
The state, which legalized the regulation of sports wagering earlier this year, will eventually see the launch of online/mobile sportsbooks. A timeline for those does not exist.
Casino market needs a boost
The state’s commercial casino gambling market generated $1,457,011,629 in revenue in the most recently completed fiscal year, according to state figures made public earlier this month. That was down slightly (0.5%) from the $1,463,808,371 won from gamblers in FY 2018.
In an effort to increase visitation to the brick-and-mortar casinos, the Iowa sports betting law requires that online/mobile sportsbooks have bettors sign up and register in-person at a casino before being able to bet via the internet anywhere in the state. The in-person requirement, which will expire Jan. 1, 2021, is onerous for bettors. It will curb growth in Iowa’s market.
Iowa will beat neighboring Illinois to the sports betting market, as the latter, which also legalized this year, will be slower to implement thanks to its sports betting law including a multitude of other changes and expansions to the existing gaming landscape. It’s a good situation for the Hawkeye State, at least through the first part of the football season, as casinos in eastern Iowa have for years had to compete against the expansion of gambling in Illinois, notably against the massive Illinois VGT market.
Iowa should draw some sports bettors in from Illinois.
Aside from the in-person registration requirement until 2021, Iowa’s sports betting law is industry-friendly. Casinos in the state will pay an effective tax rate of 7.5% on sports betting win, while sportsbooks in Illinois will face a 15% rate as well as higher fees.
In Illinois, there will be no betting on in-state college teams, while Iowa was more relaxed with its law by only prohibiting prop betting on Iowa collegiate teams.
Once the Iowa market matures and the in-person registration requirement is a thing of the past, the state could see more than $4.3 billion in annual bets, generating about $250 mm in taxable gaming win, according to a 2017 study by Oxford Economics.