Why Can’t Iowa Sportsbooks Take Bets On The NFL Draft?

Posted By Derek Helling on April 3, 2020

The 2020 NFL Draft will go on as scheduled despite coronavirus pandemic concerns. Bettors looking to get in on the action for the event in Iowa will be disappointed, however.

That’s not just because all the brick-and-mortar sportsbooks in the state are closed. Even the online sportsbooks can’t take bets on the event, and there’s one big reason why.

 

Why can’t IA online sportsbooks take bets on the NFL Draft?

You can legally bet on sports using licensed apps and websites from the safety of your home in Iowa, right? So what’s the issue?

According to state law, player selection events like the NFL draft aren’t sporting events you can wager on. That’s according to a spokesperson with the Iowa Racing and Gaming Commission.

There’s no doubt that Iowa operators like DraftKings and PointsBet would love to post a variety of markets for the event. Two first-round prospects, A.J. Epenesa and Tristan Wirfs, played their collegiate football at the University of Iowa.

Additionally, football is by far the most popular betting sport in the United States in terms of dollars wagered. Especially with the lack of other domestic sports right now, the NFL draft would bring a massive amount of handle.

The simple issue is Iowa law doesn’t allow it. Like Iowa’s prohibition on live wagers/prop bets on college athletes’ performances, this is an issue for the Hawkeye State for several reasons.

 

Why this is an issue for several interested parties in Iowa

There’s little doubt the IRGC would authorize sportsbooks’ acceptance of such wagers if the law allowed. It would generate a lot of revenue for the state via a tax on the handle.

It’s an issue for more than just the sportsbooks’ and state’s bottom lines, however. It’s also counterproductive to the entire idea of legalizing sports betting.

Because legal sportsbooks can’t take these bets, interested bettors in Iowa are likely to look elsewhere. That will likely drive them to illegal channels like local bookies or offshore websites.

One of the main motivations for legalizing sports betting was to take that action away from the unregulated market for consumer protection. When states carve specific aspects of the market out of their legal frameworks like this, it defeats that purpose.

That’s even more true when the segment of the market is as popular as the NFL at a time when there’s no other significant sports action going on. This issue could become even bigger if the problem persists.

 

Why this could drive bettors out of the state in the future

Currently, Iowa enjoys somewhat of a “monopoly” when it comes to legal sports betting. Of the six states that border Iowa, only Illinois has legalized wagering on sporting events.

That’s pertinent right now because while brick-and-mortar sportsbooks launched in IL just prior to them shutting down again because of coronavirus concerns, no online books operate there yet. Eventually, that will change, however.

IL law has no provision barring its sportsbooks from taking bets on the NFL draft. Because of that, perhaps as early as next year, IA could start losing tax dollars to IL via residents crossing the state line to place their bets there.

If Missouri and/or South Dakota legalize in the future as well, that effect will compound. Instead of pulling traffic from neighboring states, IA could see a negative balance there instead.

Just like with any other bad law, the Iowa Legislature can alter this with a simple majority vote and a signature from Gov. Kim Reynolds. It’s up to bettors and operators in the state to put pressure on lawmakers to do so.

This year, however, there won’t be any such action. The longer that problem persists, the more of a problem it will become.

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Derek Helling

Derek Helling is a freelance journalist who resides in Chicago. He is a 2013 graduate of the University of Iowa and covers the intersections of sports with business and the law.

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