DC Sports Betting Taxes Not Supporting Programs City Touted During Authorization

Posted on: March 24, 2023, 09:10h. 

Last updated on: March 24, 2023, 02:06h.

Devin O'Connor @CasinoorgDevinO Read More

Expertise: Asia Pacific Gaming, Commercial Gaming, Legislation, Politics.

The Council of the District of Columbia — often abbreviated as the DC Council — is the legislative arm of the local government inside the nation’s capital.

In 2018, the DC Council passed a local bill to legalize in-person and mobile sports betting. The bill became law after Mayor Muriel Bowser (D) signed the Sports Wagering Lottery Amendment Act in January 2019.

During the city’s gaming expansion to include wagering on sports, DC officials told the public that the associated tax revenue would benefit various initiatives. DC oddsmakers are required to share 10% of their gross income with the city in the form of a privilege tax.

Tax income from sports betting was billed as a catalyst for the city’s “Birth-to-Three for All DC” program, a 2018 amendment to the DC code that provides pediatric care and early childhood development support for families in need.

Local officials also said sports betting would support the Neighborhood Safety and Engagement Fund, a newly created plan designed to help fund the Metropolitan Police Department to provide resources for violence prevention and crime intervention. A portion of the sports betting tax benefit was also supposed to support problem gambling resources up to $200K annually.

DC government officials, however, have admitted that the city has rethought how to best use its new sports betting receipts.

Wagering Allocations

Martin Austermuhle, a reporter and editor with WAMU, DC’s NPR affiliate, tweeted this week that the District of Columbia hasn’t used its $200K annual sports betting allocation to fund problem gambling support programs since the first bet was wagered legally in 2020. The $200K annual grant is to go to the DC Department of Behavioral Health (DPH) “to prevent, treat, and research gambling addiction.”

Though the funds were directed to the DPH, the city agency hasn’t spent a single penny on related problem gambling initiatives. The health department says it hasn’t fielded any qualified bids to grant the money.

A substantially more significant portion of the sports betting tax — about $7 million annually — is to be split by “Birth-to-Three for All DC” and Neighborhood Safety and Engagement Fund. That money has been directed to the city’s General Fund.

Rashad Young, the chief strategy officer for the district, said the mayor and city council believe a better way to use the sports betting money is to transfer the taxes to the General Fund and make appropriations with the money to programs as needed. The DC Council is made up of 11 Democrats and two independents.   

Sports Betting Market

The DC sports betting law allows for retail sportsbooks at the city’s four professional sports venues, Nationals Park, home of the MLB Washington Nationals, Capital One Arena, home of the NBA Washington Wizards and NHL Washington Capitals, Audi Field, home of the MLS DC United, and St. Elizabeths Entertainment and Sports Arena, home of the WNBA Washington Mystics. Each stadium can partner with a sportsbook for both retail and online privileges.

DC sports betting includes online wagering across the district through four mobile apps: GambetDC, the official sportsbook of the DC Lottery, BetMGM, Caesars Sportsbook, and FanDuel.

BetMGM operates online through its Nationals Park partnership, while Caesars Sportsbook is the sportsbook partner of Capital One Arena, and FanDuel is the oddsmaker for Audi Field.

DC additionally allows small businesses such as bars and restaurants to acquire sports betting licenses at a reduced cost. Those permits only allow online betting to occur on the physical premises of the business establishment.