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A preliminary schedule drafted by the state lottery suggests Virginia sports betting could start by late December.
That would put sportsbook operators launching at prime time for customer acquisition: the NFL Playoffs and Super Bowl. The first playoff game is scheduled for Jan. 9, 2021.
The timeline seems ambitious for a state with no gambling outside of the lottery, but regulators are required to move forward. The enabling legislation, HB 896 and SB 384, call for regulations to be completed by September 15.
The Lottery Board plans to meet at some point in July for the first discussion on regulating Virginia sports betting, according to the lottery’s sports betting page. That’s because the legislation doesn’t go into effect until July 1.
Through mid-August, the board will listen to public commentary concerning proposed regulations.
The board won’t have much time to consider public input because the rules must be finalized by mid-September. The first applications will be accepted later that month.
The board then will have 90 days to consider whether it will approve an application. That means the first operators approved should be live by the end of 2020.
The lottery’s sports betting FAQ mentions no sports betting will be legal “before mid-to-late December, at the earliest.”
One of the recommended changes by Gov. Ralph Northam could raise application costs by as much as $1 million for some sportsbook operators. Northam called for an additional $50,000 per principal of the company.
The bill defines as anyone with 5% ownership and “any individual who is employed in a managerial capacity for a sports betting platform on behalf of a permit holder.”
That’s on top of the $250,000 licensing fee for a three-year license.
Del. Mark Sickles and Sen. Jeremy McPike, sponsors of the legislation, mentioned operators balked at the change. There could be an attempt to narrow who is ultimately included under the principal definition, Sickles said.
There are five important votes coming up this fall in Virginia that could determine how many untethered licenses are available. The regulations allow for at least four to a maximum of 12.
Casino legislation also passed this year, authorizing up to five casinos throughout the state. Those casinos are pending local referendums this November.
If all five casinos pass and want to offer sports betting, that would leave just seven licenses for untethered operators. Those licenses will not count toward the minimum, however, meaning there will be at least four untethered licenses allowed in the state.
The lottery board will make a decision on how many untethered licenses are best for the state.
There could be other sports betting licenses awarded to either a major league sports team or the operator of a major league sports facility. Those would not be counted toward any license totals.
Virginia’s sports betting legislation is a mixed bag.
Untethered operators and remote registration are positives. The 15% tax rate will come out slightly lower for operators as it’s based on adjusted gross revenue, which allows operators to exclude the 0.25% of handle from the federal excise tax.
More questionable elements include the required use of official league data to settle all in-play bets.
The ban on in-state college betting is also a negative that will lead to a smaller overall market.