After months of sports betting, how much tax money has Colorado made?
DENVER — Editor's note: The figures in the above video were slightly outdated. The numbers in the article are current.
Gone are the emails asking, "What about the pot tax?!" replaced instead with, "What about the sports betting money!?"
From the first day sports betting was legalized in Colorado on May 1, 2020, through February, Colorado bettors wagered almost $1.8 billion.
Colorado has only earned just shy of $4.5 million from those bets.
"It's not as much money as I think people think because it's not based on how many dollars are bet, it's based on profit margin of the casinos, and it's 10% of the profits that they make," said House Speaker Rep. Alec Garnett (D-Denver).
Garnett sponsored the bill that led to Proposition DD, the 2019 ballot issue that voters approved legalizing sports betting by app or in person at casinos.
Since July 2020, when the Colorado Department of Revenue started tracking bets made online versus in person, only 2% of bets have been placed at a Colorado casino. An overwhelming 98% of bets are made through an app.
Of the nearly $1.8 billion wagered, bettors have won back nearly $1.7 billion.
Casinos and apps have earned almost $110 million in gaming revenue.
That is the gross amount won by casinos.
Colorado gets its 10% cut from the net amount. The net amount is after the 0.25% federal excise tax and with deductions for free bets and promotions put on by the apps. Yeah, the ads you see offering free plays and promotions do not benefit Colorado.
Speaking of the ads, would Garnett have voted for the proposal he created if he knew how many ads sports betting would bring?
"Um, uh yes," he said. "There's no doubt that people are frustrated and annoyed by the billboards, the ads and all the advertising. That is competitiveness. People are competing with each other and that is a result of that."
What is the net amount?
About $43 million.
Colorado, so far, has earned almost $4.5 million in tax revenue.
State fiscal analysts projected anywhere between $9.7 million and $11.2 million in the fiscal year that goes from July 2020 to June 2021.
"I think we're going to come in past the low benchmark for those numbers, and that's pretty much where we thought we were going to be," said Garnett.
Where does the money go?
First, part of the revenue was spent to repay the general fund that covered the startup costs for the Division of Gaming.
Some of the money will go to the Division of Gaming for administrative expenses related to sports betting.
Then, six percent of the '20-'21 money will go to a "Hold Harmless Fund" which can help fund:
Next, $130,000 is transferred to the Office of Behavioral Health, of which $30,000 is for a crisis hotline for gamblers and $100,000 is for gambling treatment.
Finally, the remaining money goes to the Colorado Water Plan.
"One of the underfunded priorities here in Colorado is the state water plan," said Garnett.
"These are projects like increasing storage, agriculture projects, projects around conservation, land use, drought planning," said Becky Mitchell, Director of the Colorado Water Conservation Board.
The water plan does not have any of the money yet, though.
"We expect to get our first installment in the fall, and then we still have to take it to the legislature to get approval and the authorization to spend that money," said Mitchell. "I think that this fund is going to be a useful stable source of funding for water projects in the state of Colorado."
Though for it to get money, Colorado bettors need to lose.
"When Colorado water wins, we all win," said Mitchell.
"Even when the Nuggets lose ever so often, which isn't going to happen anymore because of that [Aaron] Gordon trade, or more likely, when the Rockies only win 20 games because of the terrible [Nolan] Arenado trade, don't feel too bad, your dollars that you lost are still going to go toward causes that you care a lot about, which is protecting our water and the public lands in the state that we love," said Garnett.
https://www.9news.com/article/news/local/next/sports-betting-money-colorad-water/73-746b5ed9-1fce-40ea-ae40-cb7311074ee8