Ohio Sports Betting Revenue Breakdown

The debut of sports betting in Ohio has by and large been a rousing success. The state has already raked in tens of millions of dollars from taxes assessed to gambling profits. But where does that Ohio sports betting revenue go, exactly?

The Ohio Casino Control Commission has provided the answer.

These details came out during the most recent monthly revenue release. Ohio has been providing monthly updates on how sports betting revenue is faring. Only now, though, have they dropped specifics on where that revenue is going.

So, how does the state divvy up and allocate its gambling profits? And how much money are they even making so far? Let's explore.

Ohio Sports Betting Revenue has Eclipsed $25 Million

Before looking at where the state's gambling revenue actually goes, we should look at how much money they're actually making. Spoiler alert: Ohio is making a lot.

Residents in Ohio have wagered more than $1.75 billion since sports betting went live on January 1, according to the Ohio Casino Control Commission. Not all of that money is counted toward revenue. In fact, very little of it winds up being taxable. That $1.75 billion figure is simply how much money Ohioans have wagered. It does not account for how much in winning bets sportsbooks in Ohio have needed to pay out.

Once you factor in those payouts, expenses and any tax breaks that betting operators receive for promotional programs, the Ohio Casino Control Commission says that sportsbooks made around $208 million through the first two months of legal gambling. At roughly a 10 percent tax rate, this means Ohio sports betting revenue checks in at $29 million for 2023 to date.

Mind you, these numbers only include January and February. They will likely skyrocket on the heels of March Madness betting. Some have even speculated Ohio sports betting revenue for the year could double thanks to the March Madness tournament alone. This number also stands to rise as bonus opportunities run their course. All the top online sportsbooks offer promotional programs year-round. But they are particularly aggressive when cracking new markets.

Social media was overrun with Ohio sports betting bonuses in advance of the state's gambling launch. As part of sports betting legalization, operators were not required to pay taxes on that bonus money. But those promotional funds will skew smaller as the sports betting era ages, fewer people are creating new accounts and operators are dealing with repeat customers. And as they do, sportsbooks will see a larger share of their revenue being taxed, which will lead to more money for the state

Here's Where the State Sends Their Revenue from Sports Gambling

Amid questions about how the state would handle distributing their sports betting revenue, the Ohio Casino Control Commission publicized the full details. Here is the breakdown, as compiled by CBS 10 in Ohio:

0.5 percent of license fee revenues will go to the Department of Veterans Services for supplies and maintenance at the Ohio veterans home in Georgetown and Sandusky.
100 percent of gaming tax revenue and 99.5 percent of license fee revenues will be held in the sports gaming revenue fund, also called R068.
Money will first reimburse expenses with the tax refund fund and the sports gaming tax administration fund.
98 percent of the remainder will go to the sports gaming profits education fund, also known as 5YO0
The remaining 2 percent of the sports gaming tax revenue is earmarked for the problem sports gaming fund.

This has become a somewhat standard distribution among states with legal sports betting. Bills are proposed with the vast majority of funds going to one area of development. In this case, it's education, which is one of the more popular initiatives inside the United States. At the moment, it isn't yet clear how the money will be split up among all the different educational departments and needs. The Ohio Office of Budget and Management is expected to decide this, along with providing a release date for the funds, when they gather to make their 2024-25 fiscal year budget.

Similarly, the allocation of funds toward programs to combat gambling addiction has become standard fare. It's almost a prerequisite these days. Kentucky amended their recent sports betting bill to ensure some of their revenue would be directed toward problem gambling funds, a change that's credited with pushing the proposal over the top and into legalization. Ohio had this provision in their bill from the initial stages.

Will Sports Betting Revenue in Ohio Continue to Trend Upward?

Early on, it can seem like sports betting revenue will grow forever. That's obviously hyperbole. There can be down years and months.

Overall, though, there's no end in sight. Legal sports betting in the United States is becoming more common, and as both teams and athletes begin signing more partnerships with gaming operators, yearly sports betting revenue is only expected to increase.

Still, Ohio is bracing for revenue to slow down month-over-month. It isn't that the novelty of sports betting will wear off. Instead, the sports betting industry is preparing to enter a slower period of transactions in the summer. For most of June, July and August, Major League Baseball is the only game in town among North American Sports. The NFL, NBA and NHL are all in their offseasons. (Both the NBA and NHL playoffs conclude in early to mid-June.)

However, any monthly lulls in Ohio and elsewhere should be temporary. For the time being, sports betting revenue in Ohio, along with everywhere else, is trending in one direction: up.

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

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