Governor Andy Beshear Says Kentucky Sports Betting Revenue Continues to Exceed Projections

It turns out the projections for Kentucky sports betting revenue in 2024 are going to be off by a substantial margin. And the Bluegrass State is thrilled about it.

Because the estimations aren’t nearly optimistic enough.

When online sports betting in Kentucky went live this past September, revenue projections were adjusted accordingly. The state expected a significant bump in tax payouts from an increase in activity. Over the past few months, we have received hints that these estimations would be outpaced. Most recently, the handle for Kentucky online sports betting surpassed $1 billion. And that’s after just six months of operations. 

Just so we’re clear: The Kentucky sports betting handle does not represent tax revenue. It is instead the total amount of money wagered on sports in the Bluegrass State over a given period of time. Still, this figure is generally reflective of popularity in a given market. And as Governor Andy Beshear notes, Kentucky sports betting is no different.

Kentucky Sports Betting Revenue Flirting with $50 Million Marker Over the Past 12 Months

In his latest “Team Kentucky” address, Governor Beshear explained the ins and outs of the Kentucky sports betting business. Here are the most important details, via the Lane Report, a business magazine dedicated exclusively to covering the Bluegrass State:

“In his July 11 Team Kentucky update, Gov. Andy Beshear said that in the 10 months since legalized sports betting was launched in the commonwealth, sports wagering revenue is beating all predictions and sports wagering continues to be an entertainment source Kentuckians enjoy. Preliminary numbers indicate that over $37.2 million has been collected by the treasury from sports wagering taxes and licensing fees. Over $34.8 million goes directly to the Kentucky permanent pension fund and over $930,000 goes to the problem gambling fund to educate Kentuckians on safe gambling practices, risk factors and services to reduce the consequences of problem gambling. ‘By supporting pensions, money is freed up in the General Fund,’ Beshear said. The figures are based on numbers that are self-reported by the licensees. Final numbers are reported by the new Kentucky Horse Racing and Gaming Corp.”

At this current rate, Kentucky sports betting will flirt with $45 million in total tax revenue by the end of this initial 12-month period. That’s a fairly massive dollar amount. And it has the chance to keep climbing up.

Will Sports Betting Revenue in the Commonwealth Remain on the Rise? 

Skeptics tend to take sports betting revenue with a grain of salt for the first year or two. During that time, the industry remains novel. Many believe it then appeals to customers who won’t make betting on sports in Kentucky a part of their routine.

Others worry that interest will wane over time due to online sportsbooks in the United States pulling back on their promotions. When markets first roll out legal gambling, the online sportsbook bonuses are fairly aggressive and lucrative. Companies are doing all they can to establish a large chunk of the market share. Once sports betting is live for a year or so, though, the battle over new clients reaches more of a halt. Sure, newer Kentucky online sportsbooks can enter the mix. And they will. People are already talking about the prospect of Kentucky sports betting expansion. For the most part, however, the market will reach a status quo.

Still, this isn’t really cause for concern when digging into the numbers. Kentucky sports betting interest doesn’t figure to slow anytime soon. Hosting the Kentucky Derby each year ensures it will always be a relevant market. Beyond that, given their handful of collegiate powerhouses and proximity to pro sports franchises in Ohio, Tennessee, Illinois and Indiana, the Bluegrass State will always have a built-in base of wagering clients other markets without pro franchises do not. 

Indeed, the rate of growth could slow over time. But we don’t expect that to happen imminently.

What’s the Next Step for Sports Betting in Kentucky? 

Assuming Kentucky sports betting revenue continues to beat out projections, the market’s focus will shift from building up popularity to increasing it and perfecting the industry at large. This transition can mean any number of topics climb up the list of priorities.

Will Kentucky sports betting focus on expansion? Do they look at adding online sportsbooks? Increasing brick and mortar operations? The Bluegrass State has already broadened the types of bets you can make and events you can wager on. Might they raise the Kentucky sports betting tax next?

This all seems in play. Another factor to consider? The regulation of Kentucky sports betting. Specifically, we look at consumer protection.

 As Governor Beshear’s latest report outlines, approximately 2.5 percent of Kentucky sports betting profits are allocated toward problem gambling funds. Should that number increase? The answer in a vacuum is almost always “Well, yes, duh.” But will it increase? That’s a separate matter. 

Spectrum News 1 in Kentucky reported at the start of 2024 that calls to the Kentucky problem gambling hotline have more than tripled since the online sports betting rollout. It’s a sad reality that’s all too familiar. 

Every market basically reports a noticeable ascent in problem gambling after the launch of legal sports betting. Not every state looks to expand combating it. Some do. Ohio sports betting regulators, for instance, are considering legislation that restricts how gambling operators advertise. That’s something Kentucky will explore, too. 

Regardless of what the Bluegrass State does next, though, one thing’s for sure: It looks like they’ll have the financial resources to accomplish more than initially anticipated. 

Take a look at this list of the top online sportsbooks so you can find one that works for all of your sports betting needs: