Rhode Island sports betting crossed the finish line Friday morning and could be active within three months.
Gov. Gina Raimondo signed sports betting into law, confirmed by a press release from the RI government’s website before she actually put her signature on the overarching budget bill. Sports betting is one piece of Raimondo’s larger $9.6 billion budget package that legislators sent to her desk Thursday.
Legislators in both chambers of the Rhode Island statehouse voted overwhelmingly in favor of the budget. In doing so, they became the second state in a week to approve sports betting legislation, joining New Jersey.
Here’s President of the Senate Dominick J. Ruggerio from the presser:
“This budget includes many Senate priorities, including increased education aid, investment in school buildings, and funding for the care of individuals with intellectual or developmental disabilities and DCYF. It maintains the progress we have made in lowering taxes to improve our business climate while also investing in economic development, and it provides Rhode Island with the highest percentage of revenue in the nation for sports wagering. This was a collaborative effort among the Senate, House and Governor Raimondo, and I am grateful for their partnership in development of this responsible, compassionate budget.”
How sports betting will look in Rhode Island
The initial version of Rhode Island sports betting will be quite limited. Only two casinos in the state — Twin Rivers casinos in Lincoln and Tiverton — will offer single-game sports wagering. Both Lincoln and Tiverton will receive $100,000 in compensation for serving as the host communities for legal sports betting.
Rhode Island’s state lottery will oversee sports betting. Much like Delaware sports betting, the state will work in partnership with the casinos and split revenue as opposed to a traditional tax structure.
New Englanders will not be able to bet from anywhere in the state via mobile or internet gaming platforms. The Rhode Island law only authorizes the two land-based casinos to accept wagers, without even the limited mobile provision Mississippi adopted.
According to Rhode Island lawmakers, a full expansion into mobile wagering would require approval by state voters.
Breaking down the money from RI sports betting
Here’s the allocation of revenue from RI sports betting:
- State: 51 percent
- Vendor: 32 percent
- Casino: 17 percent
You’re reading that correctly: the state will keep more than half of the money collected from Rhode Island sports gambling.
The vendor in that scenario will be IGT, which already works with the Rhode Island Lottery. IGT submitted the only bid to administer Rhode Island sports betting after 18 companies exhibited some level of interest.
What pot will they be splitting?
Raimondo’s budget projects $23.5 million in sports betting revenue for the state in the first year. To reach that projection, Rhode Island sports betting would need to generate roughly $900 million in wagers (or handle).
That might be possible, but it does not initially seem plausible. For comparison, when it was the only state with single-game wagering last year, Nevada took $5 billion in wagers. Will Rhode Island attract 18 percent of the action Nevada did? Raimondo’s record-high budget is counting on it to fill a line.
Nevada also has mobile wagering.
Welcome to the party, Rhode Island
With Delaware and New Jersey already launched, the Eastern seaboard appears well represented with Rhode Island’s entry into sports gambling.
More states could come online soon: Mississippi and West Virginia approved regulations this week, with MGM Resorts properties in the Magnolia State targeting July 21 for launch.
Pennsylvania sports betting is ready to start, but its $10 million licensing fee and 36 percent effective tax are scaring off operators from applying.
And of course New Jersey and Delaware have already joined Nevada with legal wagering this month.