Colorado’s sports betting market keeps setting new records while the state’s tax take continues to underwhelm, forcing gambling regulators to offer insights into how math works.
On Monday, the Colorado Department of Revenue’s Division of Gaming announced that the state’s licensed sportsbooks handled $210.7m in wagers in the month of October, a new record but only a 1.5% increase from September (which had grown 61% from August), suggesting the Broncos’ ineptitude may be taking its toll on bettors’ interest.
The state’s betting revenue hit a record $17.4m in October, more than four times the $4.2m generated in September. Over $16.7m of October’s sum was generated online, although overly generous bonus offers lowered the online ‘net sports betting proceeds’ to slightly less than $9m.
The state’s share of October’s revenue totaled $824,700, also a new record and a significant improvement over the piddling $70k the state collected in September (when online operators reported negative revenue due to an NFL welcome bonus frenzy).
The general public apparently finds it confusing that the sportsbooks are handling hundreds of millions while the state is collecting relative pennies. The Division of Gaming saw fit to release a ‘How Sports Betting Revenues Are Taxed’ info-sheet explaining how the system works.
The regulator explained that “in some cases, the tax credits exceeded the taxes owed, allowing operators to carryover a negative tax amount to the following month. These carryovers skew the numbers to show a lower tax rate.” The regulator added that the numbers “should” even out once there’s a whole year of monthly numbers to average (the state’s betting market only got underway in May).
While Colorado casinos may not be seeing much direct benefit from sports betting — just $4.3m in retail wagering handle and revenue of $678k in October — some Colorado gamblers are rejoicing at the news that casinos in the city of Black Hawk will no longer cap individual table game bets at $100. Black Hawk, along with the casinos in Central City and Cripple Creek, originally capped max bets at $5 in 1990 but this was raised to $100 in 2008.
A ballot initiative was launched this summer to allow each city to set its own casino limits and approve new gaming options. Voters approved the measure by a wide margin last month and Black Hawk city council voted Tuesday to lift the limits and add new products such as baccarat and table game side bets. The new rules are expected to take effect May 1, 2021.