‘Extraordinary’ first year of sports betting in Tennessee
Sports betting in Tennessee is on a fast track according to industry experts
KNOXVILLE, Tenn. (WVLT) - People putting their money on the Vols aren’t alone.
Online sports betting in Tennessee has only been legal since November 2020, and already the state has made millions of dollars off wagers placed inside state lines.
“If you want growth in this business, the way Tennessee is doing is the correct way. With the digital aspect, it’s easy to log on, it’s easy to make a bet and it’s easy to find and withdraw money, so yeah I think Tennessee is is doing it correctly and, we’ll continue to see that grow through the state,” said Johnny Avello, Director of Operations for DraftKings Sportsbook.
According to Nicole Russo with PlayTenn, it’s only the beginning. At the pace Tennesseans are using sports book applications, the state could be one of the fastest to hit $2 billion in wagers in its first year. As of September 2021, Tennessee is at $1.5 billion in wagers.
The money coming into the state is handled by the Tennessee Education Lottery. Every month the state collects a ‘privilege tax’; it equals 20 percent of the bets, after it’s all paid out to winners. That cut of the money usually adds up to millions each month; experts expect to see the highest number of bets during this fall during the college and professional football season.
Then, the lottery divides the money into three categories. Eighty percent goes to fund higher education scholarship, 15 percent goes to local governments and five percent of the money helps fund gambling addiction recovery services.
But some lawmakers want to change how that money is divided up.
“We actually see that in your state that some legislators...are arguing that some of that money should be put towards the public school system and fixing sort of the public school infrastructure and helping with renovations,” said Russo.
There’s also new regulatory body coming in to handle the apps that want to facilitate the bets.
“The Tennessee Education Lottery is going to step back, they’re going to still regulate the lottery, but you’re going to have what’s called the ‘Sports Wagering Advisory Council’,” said Russo. The council will set the rules for sportsbooks as a third party.
Tennessee isn’t just getting a boost from people who live inside the state lines. Sportsbooks track users’ locations to make sure they’re placing bets in a state where it’s legal, to make sure bettors aren’t putting money down in places where it isn’t allowed.
Neither North Carolina nor Kentucky have legalized online sports betting, which means people from those states have to travel into Tennessee if they want to place their bets, and it’s not the only place where it’s happening.
“I think that when you have a state that’s surrounded by a bunch of other states who can’t bet, people cross the border. We’ve seen this before in New York, they didn’t have sports betting for a really long time and there were hoards of people jumping on the ferry going to New Jersey, placing their sports bets and coming back,” said Russo.
Industry leaders expect this online trend to spread throughout the country, as states see the kind of money that they can pull in from the online betting system.
“We’re going to continue to grow, I think you’re going to see it in almost every state, if not every state,” said Avello. “There’s a couple that may elect not to do it, but I believe you’ll see sports wagering in 90 percent of the U.S.”
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