Data shows Vermont raised $3.5 million from sports betting companies in first six months

The DraftKings Sportsbook & Casino App. Photo by Shaun Robinson/VTDigger

According to Vermont, the state generated $3.5 million in revenue from online sports betting in the first six months the market was legal. facts of the Vermont Department of Liquor and Lottery slightly more than the state's financial analysts initially projected.

That represents the state’s cut of the roughly $11 million these Vermont businesses earned during the same period, the data shows. In total, people living in or visiting Vermont wagered more than $100 million on sports from January through June. However, the data shows that operators paid out nearly 90% of that money to winning players.

When state lawmakers legalized online sports betting in June 2023, the Legislature’s Joint Fiscal Office estimated the market would bring in $2 million to state coffers in the first six months. But Wendy Knight, the commissioner of the state’s liquor and lottery departments, said officials quickly determined the market’s potential was greater.

We're happy, she said in an interview Friday, “We've shown that we've been able to bring in some revenue that, of course, would have gone to other states.”

Vermont was the last state in New England and about the 30th state in the country, including Washington, D.C., to allow online sports betting. Geolocation data Data provided to state lawmakers last year showed that people were crossing state lines from Vermont to bet on sports, largely into neighboring New York, where online sports betting is allowed since 2021The data also showed that thousands of people in Vermont tried to illegally access sports betting platforms.

Vermont signed deals with three gaming operators last year: DraftKings, FanDuel and Fanatics Sportsbook. As part of those agreements, Vermont now receives between 31 and 33 percent of each company’s revenue from their users in the state.

Knight expects the state to bring in about $7 million in the first full budget year the platforms are available in Vermont, which runs from July 2024 to June 2025.

Sports betting revenues are largely allocated to the state’s general fund, though some are earmarked for new state funds that officials hope will help curb problem gambling. Nearly 12,000 people in Vermont are estimated to have gambling problems, state officials have previously said.

In fiscal year 2024, which ended in July, the state put $250,000 from sports betting operators plus $250,000 in revenue from the Vermont Lottery into a special fund for new problem gambling services, administered by the state Department of Mental Health.

The department started last month a new website which contains information for people seeking help with gambling problems, behavioral signs that players should look out for and a live chat with peer support specialists.

“Problem gambling can have a significant impact on mental health, finances and family dynamics,” Elliott McElroy, the Department of Mental Health’s Responsible Gambling Program Coordinator, said in a press release. “This website provides individuals with a place to find the resources and care they need to overcome problem gambling.”

The state also offers a voluntary self-exclusion program from betting platforms. In June, there were seven people who had chosen to self-exclude for one year, five years or for life, Knight said.

In the first six months of online sports betting operations, Vermont saw an average of about 39,000 monthly active users, data shows. Collectively, they placed about 4.65 million total bets. Knight noted that active user numbers were highest when the platforms were new, with about 52,000 registered users in January, data shows.

According to the data, the number of active users had dropped to around 12,000 in July.

Vermont’s sports betting market also benefits significantly from out-of-state visitors who play while in the state, according to data from the state’s liquor and lottery department. In those first six months, about 38% of Vermont’s active users came from out of state; in July, more than 43% were from out of state.

Knight said the trend makes sense in a state whose economy relies heavily on tourism. The sports betting market saw a spike around the total solar eclipse in April, she said.

The data also shows that out-of-state users are betting significantly more money on sports on average than in-state users. In the first six months the platforms were live, the average bet placed by Vermont residents was $19.05, while bets placed by visitors or second homeowners averaged $34.33.

The state also collects data on the sports people bet on.

Basketball was by far the most popular bet in the first half of 2024, accounting for around 40% of all bets placed, the data shows. It was followed by baseball, tennis and football, all of which had around 9% of total bets. Hockey came in fifth, accounting for around 5% of bets placed.

Knight noted, however, that the state is expecting a sharp increase in football betting when the 2024-25 NFL season kicks off next month. The 2023-24 NFL season was in its final stages, she said, when sports betting went live in Vermont earlier this year.

The commissioner said state officials were surprised by the ministry's latest trove of betting data, for July 2024. A new sport had entered the top five most-placed bets: table tennis.

Who would have thought?, Knight said with a laugh.