Virginia Lottery Flooded With Sportsbook Applications Against Limited Licenses
As many as 18 applicants have applied for the Virginia sports betting license against five available in the state, according to a lottery official. The applications are currently being reviewed and the new licenses won’t be approved before July 1.
In late March, Gov. Ralph Northam signed legislation to fix the original sports betting bill he had signed in April 2020 – nearly nine months before Virginia sports betting launched in Jan. 2021.
HB 1847 – which Northam signed in March – allowed five additional licenses. It rectified a common misunderstanding that had counted Virginia sports betting licenses with casinos against the cap of 12 maximum mobile (untethered) licenses.
More precisely, HB 1847 allowed five additional mobile licenses, effective from July 1.
Currently, there are seven sportsbooks operational in Old Dominion.
What Changes Are Expected in Virginia Sports Betting?
The potential changes will see an increased market size to 18 operators (or more). Licenses awarded to sports betting operators through an agreement with a professional team do not count against the cap either.
Though online sportsbooks will grow to 18 operators – there’s no retail betting available for now in the state – more operators could launch depending on professional teams’ possible associations with sportsbooks.
FanDuel had kicked off Virginia sports betting in late January, owing to its partnership with the Washington Football Team, which was granted preferred consideration by the law.
No Guarantees All-Five Will Be Awarded
Though there’s a huge competition against rare licenses, there is no guarantee all five licenses will be awarded to the luckiest applicants. It all depends on VA Lottery Executive Director Kevin Hall, who will decide how many licenses to award based on what should maximize revenue for the state.
Yet, it is unlikely that the regulator withholds any license as the Virginia online sports betting market has shown phenomenal growth since its mid-January launch.
The state is likely to hit a $1 billion in cumulative handle in the May report, which is yet to be released. From January to April, Virginia sports betting had amassed more than $865 million in handle.
Existing Market Condition
The Virginia Lottery had reported 25 applications for the initial licensing period ahead of the launch when the state’s sports betting market was allowing 12 total licenses, in addition to partnership licenses.
Currently, there are seven operators live in the state – including FanDuel, DraftKings, BetMGM, BetRivers, William, Hill, and WynnBET. Three more operators – Bally Bet, Barstool Sportsbook, and Golden Nugget – have obtained licenses, but they have yet to launch.
New Standards This Time
The March legislation introduced new standards for awarding the additional five licenses. There will be “substantial and preferred consideration” based on minority participation – something akin to Maryland sports betting, the first state to emphasize actively minority and women participation.
That language held the bill up until the clarification was made by the regulator that the new requirements would not affect those entities already licensed.
Yet, there will be more sports betting licenses. Hard Rock, the Pamunkey Indians, and the Urban One casino project in Richmond will obtain sportsbook licenses.
Though Hard Rock is expected to advance through its in-house Hard Rock Digital, the future associations of the other two brands are still unknown.