Two major developments are on the horizon for sports betting enthusiasts in Washington, DC. BetMGM and Caesars Sportsbook were poised to expand their presence across the city starting Monday, 15 July, but the much-anticipated movement has hit a snag due to a delayed budget approval from Mayor Muriel Bowser. The absence of a signed budget bill has already led BetMGM to cancel its planned celebration at Nationals Park, highlighting the palpable impact of the delay.
BetMGM and Caesars Sportsbook Await Green Light
BetMGM and Caesars Sportsbook, both holding Class A licenses, had grand plans to enhance their digital platforms within a specified two-block exclusion zone surrounding their respective venues, Nationals Park and Capital One Arena. Caesars made its initial splash in July 2020 by opening a sportsbook at Capital One Arena, while BetMGM followed suit in June 2021 with operations at Nationals Park.
FanDuel Holds the Fort
In the interim, FanDuel remains the sole sports betting platform available to DC residents, thanks to its partnership with the DC Lottery. FanDuel has shown promising results through this collaboration, with the lottery-backed service generating $4.9 million in revenue in May 2023 alone. This stands in stark contrast to GamBetDC, the previous platform, which mustered a mere $711,282 that same month.
The DC Council's decision to grant the FY 2025 budget final approval on 25 June means that once the budget goes into effect on 15 July, there could be significant changes to the landscape. Notably, the new legislation introduces Type C licenses, valid for five years at a cost of $2 million, with an annual renewal fee of $1 million and a 30% tax rate. This new type of licensing also paves the way for operators to partner with franchises, not just venues. Under this framework, FanDuel’s market access at Audi Field remains significant, bolstered by its favorable 20% tax rate.
Historical Context and Future Prospects
In January 2019, the DC Council approved a single-provider digital market without a competitive bid process, awarding the expanded lottery contract to Intralot, which included sports wagering services through its GamBetDC platform. However, the platform faced repeated criticism for limited betting markets and technical problems, falling well short of its revenue expectations. This led to FanDuel entering the fray with DC Lottery, driving up the handle by 450% in its first month of operations compared to GamBetDC.
The introduction of Type C licenses signifies a pivotal moment in DC’s sports betting environment, reflecting a broader trend towards more robust and flexible wagering opportunities. This new legal framework also mandates a significant financial commitment from licensees, with substantial initial and annual fees, alongside a hefty tax rate. These measures underscore the city’s commitment to regulating this burgeoning market while ensuring substantial revenue generation.
Revenue Dynamics and City Benefits
The city stands to gain considerably from the operations of licensed wagering platforms, with a 40% share of the revenue from lottery-backed wagering partners. This financial benefit is poised to increase as more operators enter the market under the new licensing conditions. With Intralot’s contract having expired on 15 July, the stage is set for new and existing players to capitalize on the DC betting market’s potential.
As the situation stands, the approval of the budget bill is the crucial next step. Once sanctioned, BetMGM, Caesars Sportsbook, and others will be able to fully realize their expansion plans, potentially transforming the sports betting landscape in Washington, DC.
Awaiting Further Developments
Residents and betting enthusiasts in the nation's capital are keenly watching for the Mayor’s approval of the FY 2025 budget. With the scheduled implementation date on 15 July, the delay has undoubtedly caused ripples across the stakeholders involved. However, the anticipation remains for a more diverse and competitive sports betting marketplace once the legislative and administrative hurdles are cleared.