Lottery cuts expectations for sports betting revenue in half
PROVIDENCE, R.I. (AP) — Sports betting is now expected to bring in about $15 million in Rhode Island in the next fiscal year, half of what state officials had hoped for, the lottery said Tuesday.
The new estimate is based on a consultant’s report, and Revenue Department spokesman Paul Grimaldi said it’s more in line with what the two sportsbooks have experienced since launching sports betting late last year. The official revenue target will be set next week.
Most of the states that moved quickly to legalize sports betting after the Supreme Court cleared the way are still waiting for the expected payoff. Tax revenue has fallen far short of projections in four of the six states where gambling on sporting events started last year, according to an Associated Press analysis .
The Rhode Island governor’s proposed 2020 budget counted on an estimate of $30 million from sports betting next year. But the consultant, Christiansen Capital Advisors, LLC, projects the state won’t make that much off sports betting annually until 2024. It estimated sports betting would bring in $2.65 million this fiscal year.
Those numbers are based on the current gambling landscape and will be lower if a casino opens in Taunton, Massachusetts, or if sports betting is legalized in neighboring Massachusetts or Connecticut, according to the consultant.
Most of the annual revenue is projected to come from online sports betting, which the state aims to launch in time for the start of preseason football at the end of the summer.
Rhode Island had expected to make $11.5 million off sports betting this year. Among the reasons it missed its targets was an all-too-predictable Super Bowl. When the Patriots won, again, and covered the spread, too, the state’s sportsbooks lost $2.35 million.
The sportsbooks had their best month yet in March, thanks to bets from college basketball fans. The $1.5 million profit was the highest monthly total. The state gets 51% after expenses are subtracted.
Lottery Director Gerald Aubin has said he thinks the market will continue growing, and it’s fortunate that Massachusetts and Connecticut haven’t launched sports betting.