Sports betting services line up to enter the DC market

By Keith Stein,
Editor at online-gambling.com

Keith Stein Editor at online-gambling.com

As a self-starter and goal-driven, Keith took up freelance writing in 1994 and within a few years moved into a full-time journalist position in 1997 in Washington, D.C. In recent years, he has published over 100 articles that focus on gambling news, reviews, and tips and tricks to give the player a slight advantage.

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Last updated: May 6, 2024

FanDuel Sportsbook took over as the lone mobile sports betting in the District of Columbia less than 30 days ago, now Washington wants more operators in the city.

D.C.’s Committee on Business and Economic Development met this week with sports betting operators, government officials, and public witnesses to take testimony on a proposed bill that would invite more online sportsbooks to the city.

Sports Wagering Amendment Act of 2024

The new bill, B25-0753 Sports Wagering Amendment Act of 2024, would allow up to seven online/mobile sportsbooks to operate in Washington, D.C., ending FanDuel’s monopoly over the city.

The District of Columbia’s Office of Lottery and Gaming (OLG) announced in March that FanDuel would be the new sports wagering subcontractor for Intralot, Inc. Intralot, a lottery and gaming tech company based in Greece, has been the main contractor for the District of Columbia since sports betting launched in May 2020. FanDuel was selected to replace Intralot’s GambetDC app after it experienced a series of issues from its start and lost more than $4 million in one year. FanDuel started operating on April 15.

The Sports Wagering Amendment Act of 2024 would tax new mobile sport wagering companies coming into the city at a rate of 30% of gross gaming revenue. A license to provide mobile sports betting would cost $2 million to acquire for five years and a $1 million renewal fee after that. The bill also calls for a tax increase for retail sportsbook locations from 10% to 20% of gross gaming revenue.

Three sportsbooks are currently operating in the city. Caesars has a facility at Capital One Arena, FanDuel operates from Audi Field, and BetMGM has a location at Nationals Park. FanDuel is the only mobile sports betting app that is citywide.

Impact on D.C. Small Businesses

D.C. committee members showed concern about how Certified Business Enterprises (CBE) in the city would be affected by the addition of seven mobile sports betting apps and tax hikes at retail locations. CBEs receive preference in procurement opportunities offered by the District of Columbia and help position businesses to better compete in government contracting opportunities.

“It is not my desire to curtail any opportunities that certified enterprises would have,” said D.C. Council Member?Kenyan McDuffie. “It’s actually to figure out ways to enhance and expand on those opportunities.”

Robert O’Connor, VP of Government & Industry Affairs for BetMGM, told the committee a mobile product in the city will bolster the company’s existing operations and provide a way to connect with customers away from their retail location at National Park.

“This model has been successful in markets around the country and I’m confident that D.C. will experience an increase in tax revenue, growth to retail verticals, and increased opportunities for our CBE partners,” O’Connor said.

Tax Hike on Retail Sportsbooks

Meanwhile, Dan Shapiro, senior vice president and chief development officer at Caesars Digital, part of Caesars Entertainment, voiced “serious concerns” about the tax structure in the new bill. Since opening their sportsbook at Capital One Arena, Caesars has paid more than $5 million in taxes to the district.

About the tax hike in bill B25-0753, Shapiro said, “The legislation doubles the retail tax rate to 20%. This raises questions on the future viability of the [retail] sportsbook and puts the 50 jobs at risk and the CBE vendors we use. Raising this tax rate on retail sports betting to 20% would be devastating to the sportsbook and potentially fatal. It would put this sportsbook in the red.”

Brant Iden, VP of Government Affairs at Fanatics Betting & Gaming, told the committee the district’s sports betting market will continue to underperform with just one mobile option.

“There is no doubt that lottery’s new mobile partner [FanDuel] will significantly enhance revenues for the district,” Iden said. “DC’s market is still forecasted to significantly underperform without this legislation because it lacks competition among mobile sports operators. By simply expanding the market to several of the nation’s top mobile sportsbooks DC will be aligned with the region and poised for success.”