Colorado sports activities betting tops $1 billion in 2020, producing sufficient taxes to assist water fund – The Denver Channel
DENVER — More than $1.1 billion in wagers were placed in Colorado during the state’s first year of legalized sports betting, producing enough tax revenue to cover operating costs and begin contributing to the state water fund.
The state collected $3,418,818 in tax revenue from sports betting wagers from May through December, easily surpassing the $2 million threshold needed to cover startup and administration costs and begin benefiting the water fund, which needs to raise about $3 billion.
Legalized sports gambling was narrowly approved by Colorado voters in November 2019. The program was designed to provide tax revenue for the state’s water plan. Once operating costs are covered — and $130,000 can be provided to gambling addiction services — tax revenue from sports betting will go toward the water fund.
But shortly after voters passed the measure, the state Joint Budget Committee in a memo projected less tax revenue than expected from sports betting, warning that Colorado could possibly only generate a fraction of the previously reported revenue estimates.
Still, even during the pandemic, when most U.S. sports were on hold as sports betting launched in Colorado in May, Coloradans placed millions of bets on sports such as European table tennis and South Korean baseball.
Sports betting in Colorado only ramped up as major sports returned throughout the summer and fall. In December, there were $284 million in sports wagers placed, easily pushing Colorado over the $1 billion mark for the first seven months of legalized gambling.
Colorado collects a 10% tax on sports betting proceeds from operators. In December, that resulted in about $530,000 in revenue for the state.
Pro football was easily the most-wagered sport in Colorado, with $88,176,862.51 wagered in December. The second-most wagered sport, pro basketball, saw about $42 million in bets placed in Colorado, followed by college basketball ($35 million), NCAA football ($14 million) and table tennis ($10 million).
State officials called Colorado’s first year of legalized sports betting a success.
“Hitting the $1 billion mark is a milestone event for the department, leading us to believe that the trust and competition in the industry are leading bettors from the black market to the regulated market,” Dan Hartman, director of the Colorado Division of Gaming, said in a news release. “We believe the legal marketplace is having and will continue to have a positive impact on Colorado.”