Sports betting in Tennessee is a year old as of Nov. 1 and sportsbooks in the state look like they’re starting to hit their stride.
Handle hit a record $375.3 million in October, up nearly 46% from the $257.3 million that set the record in September.
Sports betting revenue was $23.3 million, shy of the record set last month, though adjusted gross income was higher at $17.2 million. That translated to $3.4 million in taxes.
How’s hold look for TN sportsbooks?
It looks like operating online sports betting in Tennessee is going to cost an extra $25,000 for at least some operators.
From January through October, adjusted gross income totaled $152.4 million. That’s good for just a 7.5% hold on the $2.023 billion bet over that span.
That actual hold is a little muddied, of course, since only four operators will be held to the requirement for January-December out of the eight live:
After a meeting on Friday, Tennessee’s incoming regulator is not removing the rule on a mandatory 10% hold. The Sports Wagering Advisory Council met for more talk on rule changes on Friday.
Eliminating it completely, though, does not sound like it is on the table.
“I don’t think [removing the cap] is necessarily the right answer at this point in time, according to, you know, the way that the rules are written and the way that it appears the legislators would like for the rules to be written,” said rules committee member Kandace Stewart before Friday’s meeting.
Was there legislative support for mandatory hold on TN sportsbooks?
Stewart’s mention of how the legislators wanted the mandatory hold has been mentioned by multiple SWAC members. The public facts do not back that up, though.
LSR re-listened to all of the hearings around HB 1 and SB 16, the two bills that legalized online TN sportsbooks in 2019. Not once is a mandatory hold mentioned over those hours of deliberation.
Mary Beth Thomas, the first executive director of the SWAC, told LSR “many different people” told her about the legislature’s wants:
“It was my understanding that the legislative leadership made it clear when this law was passed that they wanted a 10% hold as a requirement. … I think it was while the law was being passed that those were discussions taking place about how much revenue was going to be generated and what would prevent all of the revenue from being eaten by expenses or payouts, that kind of a discussion, and that the hold was discussed during the legislative path.
“I don’t know, because I wasn’t involved in this role back then I wasn’t a part of those discussions, but I’ve heard from many different people that those discussions took place with legislative leadership.”
Wagr approved for launch
The TEL conditionally approved the pseudo-P2P sportsbook Wagr to launch with a few important restrictions.
Wagr was unable to get the full amount of insurance needed to launch. It will launch conditionally for 90 days with strict rules:
- $500 max for each wager.
- $10,000 maximum monthly for each player.
- Point spread bets only.
- Maximum amount of wagers must be less than Wagr’s insurance coverage of $5 million.