Sports betting in Iowa was legalized in 2019 and bets began in August of that year. Since then revenue had been on the rise until the back half of the 2021 – 2022 fiscal year.
From June 2022 through December, total bets decreased by 9% compared to the end of 2021. The decline was a first for the state but some factors likely contributed.
Factors contributing to a slow down of sports betting in Iowa
The big factor is likely that 19 more states legalized sports betting during 2020, bringing the overall total to 33 states. The proposals in neighboring states of Minnesota and Missouri can also bring future numbers down.
That being said, it’s hard to gauge where numbers should be given the circumstances over the last few years. Right after sports betting was legalized in Iowa the COVID-19 pandemic hit in 2020.
Overall a total of $1.148 billion in sports bets were placed in Iowa from July through Dec. 2022. This is down $1.255 billion from the same time frame as the previous fiscal year.
Sports betting became legal in 19 more states in 2020
Sports bettors without legalized gambling in their state have some alternatives, with the main one being they can drive to a neighboring state border and place bets there.
Many of the bordering states have the option to travel to Iowa to place sports bets, but more and more states have joined. This means the revenue is being spread out so a decline is understandable.
Surrounding states without legal sports betting include:
- North Dakota
- South Dakota
Sports bettors all have the option to place bets in Iowa, but also have options. Some of the surrounding states with legal sports betting include:
- New Mexico
- West Virginia
November revenue was flattened thanks to ‘Mattress Mack’
There was certainly a decline in revenue in the back half of the 2022 fiscal year compared to the previous year, but the overall revenue for the year was still up slightly.
Part of the decline in November’s revenue in particular was due to the payout of a massive bet made by businessman and avid gambler James Franklin McIngvale.
He is the owner of Gallery Furniture in Houston, Texas and was part of a historic Major League Baseball World Series payout.
Overall, McIngvale placed bets in Louisiana, Iowa and Nevada across six different sportsbooks for a total of $10 million. He was paid $75 million in total after the Astros won the World Series.
The businessman placed two $1 million bets in Iowa at +500 odds at Unibet and Betfred Iowa sportsbooks. This put $12 million in his pocket alone from Iowa.
This resulted in Betfred Sportsbook losing $6.03 million and $6.28 million in the red for Unibet for November 2022. This was $14.1 million less than in November 2021.
This was a small piece of the pie in the grand scheme of things, and operators that take a loss in any given month will avoid paying taxes as an upside.