Gov. Mike DeWine of Ohio Signs Sports Betting Bill into Law

On Wednesday, December 22nd, Ohio Governor Mike DeWine signed the state’s sports wagering bill into law, paving the way for the launch of a regulated market somewhere in 2022. The governor’s signature was widely expected following the approval of the sports betting bill in the legislature two weeks ago. All along, he has been a vocal supporter of legal sportsbooks in his state.

Before the regulated sports betting bill, HB 29 moved to DeWine’s desk. Senator Kirk Schuring (Representative of Ohio’s District 29), who chairs the Select Committee on Gaming in the Senate, said:

Quote

“This is going to benefit the state of Ohio economically. In addition, we all know that sports gaming is going on right now as we speak illegally. We’re going to put the necessary regulatory guardrails around it to make sure it’s done correctly here in Ohio.”

With Gov. DeWine’s official green light, the Buckeye State is now the 34th US jurisdiction (33 states and Washington DC) to officially legalize some form of regulated sports betting. Among the 33 states are most of Ohio’s neighbors, including Pennsylvania, Indiana, Michigan, and West Virginia. So, from now onward, it is upon the Ohio Casino Control Commission to draw up the framework for the just okayed regulated sports betting market.

As has always been the case with other states that have welcomed regulated sports betting, the process of crafting the rules and regulations for a brand-new industry will take a couple of months. The Commission projected that it would start reviewing applicants interested in offering sports wagering services in Ohio sometime in the summer or fall of next year in a recent presentation. After the regulator sets everything up, Ohioans will legally be placing wagers on pro sports, college sports, and esports by January 1st, 2023, at the latest.

The Buckeye State Poised for Big Wins from Regulated Sports Betting

Ohio’s legal sports betting market is projected to be among the largest in the US as the state is home to about 11.7 million residents. In contrast, Pennsylvania and Illinois, currently the third and fourth largest regulated sports betting markets in the USA, have 12.8 million and 12.6 million residents, respectively. Moreover, with nine pro sports franchises and 13 college institutions with NCAA Division I athletics teams, sports fans will have tons of opportunities to wager on local sports teams.

Based on an estimate from the Ohio Legislative Commission, the sports betting market is expected to be worth $3.35 billion upon market maturity. Given that the Buckeye State charges a 10% taxation on the net revenue generated from legal sports betting, the state could win up to about $7 million over the first half of 2023. By the end of the first full fiscal year, the Ohio Legislative Commission’s research projects that the state could collect about $24 million.

As for licensing fees, entities seeking Type A operating licenses in Ohio will part with the most money, starting from $500k to $2.5 million. The sum to be paid by an applicant will be based on whether the sports betting proprietor is a pro sports franchise and the number of mobile management service providers it has contracted. Meanwhile, Type B and Type C license seekers, on the flip side, will pay between $50k and $100k per license, based on the nature of the business of the applicant. These licensing fees are non-refundable and will earn applicants a 5-year term of offering legal sports betting in the Buckeye State.

Per the newly signed regulated sports betting law, 98% of the proceeds generated from licensed sportsbooks will be pumped into K-12 public and private education. The other 2% is earmarked to assist with problem gambling in Ohio. Further, through the first couple of months of launching a regulated sports betting, Ohio will likely collect over $10 million in license fees. In addition, 0.5% of the license fees will be directed to state projects that offer assistance to veterans and their families.

The eight professional sports teams along with the PGA and NASCAR are expected to apply for legal sportsbook licenses. Additionally, the state’s four casinos and 11 racinos will also be applying for licenses to get a piece of the regulated sports betting pie.