How Much Money Ohio Sports Betting Could Generate For The State

Ohio sports betting will launch on Jan. 1, 2023. When it launches, it could make millions for Ohio. The fiscal note on Ohio’s sports betting bill estimates that Ohio sports bettors could wager $2.7 billion in the first fiscal year of sports betting. The fiscal note further assumes taxable revenue of $177 million in sports betting’s first fiscal year. At a 10% tax rate, that would translate to $17.7 million in tax revenue in Ohio sports betting’s first year.

Ohio would split that tax revenue between two places. 98% of sports betting tax revenue would go to the Sports Gaming Profits Education Fund (SGPEF). 50% of the SGPEF’s resources fund extracurricular programs for kindergarten through 12th grade. The other half supports K-12 programs as “appropriated by the general assembly.” In other words, it’s spent how Ohio’s general assembly deems fit.  

The remaining 2% of sports betting tax revenue will go to the Problem Sports Gaming Fund (PSGF). This fund will be dedicated to problem gambling programs in Ohio. So far, the specific programs haven’t been described. Ohio’s sports betting bill creates a nine-member committee to study problem gambling and what kinds of programs should be funded. Specific plans for spending money in the PSGF will likely (hopefully) come from this committee’s findings. 

Ohio Sports Betting Compared To Its Neighbors 

The legislative fiscal note compares Ohio’s potential sports betting tax revenue to Mississippi, New Jersey, Pennsylvania, and West Virginia. New Jersey and Pennsylvania’s average monthly tax revenue dwarf Ohio’s potential monthly first-year tax revenue. $17.7 million in annual tax revenue averages out to just under $1.5 million per month. (However, sports betting is highly seasonal. Most of the year’s sports betting tax revenue will be made from September to March.) 

In contrast, New Jersey made an average of $3.3 million per month from sports betting. Pennsylvania made an average of $4.4 million per month from sports betting. So, Ohio doesn’t seem to be predicting that it’ll overtake two of the largest online gambling industries in the United States.

But Ohio is predicting that it’ll blow states like Mississippi and West Virginia out of the water. Mississippi only allows retail sports betting. Since most sports betting tax revenue comes from online sports betting, Mississippi has no chance of competing with the largest sports betting industries. 

West Virginia has online sports betting, but between retail and online sports betting, West Virginia only made an average of $257,000 per month. It’s a much smaller market than Ohio is projected to be.

So, Ohio is projecting itself to be in a mid-tier below the largest sports betting markets but well above the smallest. 

Revenue Estimates In Perspective 

There are a few ways that Ohio could surpass its revenue projection. The betting kiosks its sports betting bill authorizes could boost handle enough for a meaningful increase in tax revenue. The number of licensees could boost revenue. Ohio bettors could engage with sports betting at a higher rate than assumed.

But even the fiscal note’s projections paint a rosy picture of Ohio sports betting. It projects as a mid-sized sports betting market that includes room for major sportsbook brands, online sports betting, and kiosks in public places. 

However, its educational benefits may be overblown. In fiscal year 2021, Ohio spent $10.9 billion on education. and $7.9 billion of it came from state funding. While a few million dollars a year is a welcome contribution to education, it’s not a transformative amount of money for Ohio. 

About the Author

Christopher Gerlacher

Christopher Gerlacher is a freelance writer tucked into the foothills in Colorado Springs. He works as a content writer, professional resume writer, and SEO professional articles in multiple industries that can be viewed from his portfolio. He's a contributor to both Michigan Sharp and Colorado Sharp.