Opinion: Ban On Virginia College Betting Hinders Fertile Market

Editor’s Note: The following represents the view of the author.

Virginia will soon become the next frontier of legal sports betting, but the commonwealth is heading into the unknown with the equivalent of a broken wagon wheel and a little too much baggage.

It’s all due to its ban on Virginia college betting, specifically restrictions that halt wagering on in-state colleges and universities.

Earlier this year, Virginia became the second state to legalize sports betting in 2020. As a result, the first operator will likely be online in early 2021. However, it’ll do so without some of the most enticing betting options for Virginians.

The Virginia Lottery, which has been tasked with regulatory duties for sports betting in the state, is in the legislative process’s home stretch.

After state representatives and Virginia Gov. Ralph Northam signed off on legal sports betting, they drafted regulations. They now need to be approved by Sept. 15.

Though, the public has until Sept. 9 to weigh in on the rules.

But one likely sportsbook operator has already issued some concerns.

Caesars Entertainment addresses banned betting

Caesars Entertainment submitted the first notable public comments and specifically mentioned one restricted market.

While the company’s cold stance on responsible gaming prompted valid scrutiny, Caesars lobbyist Ken Hutcheson made a compelling argument on another topic. It specifically addressed Virginia’s ban on Olympic wagering.

Yet, the same argument and logic can be applied to its college betting restrictions. Those guidelines prohibit betting on in-state institutions, as well as betting on prop bets on college sports throughout the country:

A prohibition on betting on Olympic sports is not contained in the Virginia sports betting statute, and there is no valid public policy objective that is served by this prohibition. Its imposition simply channels wagering activity on Olympic sports to other states where such betting is permitted or to illegal bookmakers, defeating the fundamental purpose of legalized sports wagering in increasing transparency of such activity and affording it consumer protections.

Such bans give the impression of responsible gambling, but they’re usually little more than window dressing. After all, history has shown that the best way to root out corruption and potential match-fixing is with a large and well-regulated betting market.

Additionally, though athletic program administrators have spearheaded the efforts to curb betting on Virginia colleges and universities, it’s those very institutions that make up much of the VA sports landscape. It would also be a cornerstone of sports betting in the commonwealth if legal.

Virginia college betting is a common language

Virginia is without any major professional sports teams. Therefore, diehards often turn to bordering states to pledge their pro-sports allegiance.

Sure, Virginia has its fair share of fans of Washington, DC, pro teams, for example. College fandom, though, remains a true Virginia staple.

When I first moved to Virginia in 2019, local sports were always a go-to icebreaker with new neighbors.

Once I mentioned I wrote about sports for a living – and that I had family members who graduated from nearby James Madison University and the Virginia Military Institute – the conversations were easy.

My dog, eager to continue her evening walks, would tap her little paws as we chatted. The topics? Virginia Tech’s chances against Notre Dame on the gridiron. Or maybe the potential for the University of Virginia to repeat as national hoops champions.

In fact, back in February, I traveled 3 miles down the road and was one of 786 attendees of a VMI-Wofford basketball game here in Lexington. It was a thrilling Saturday afternoon affair. All the more so considering the mere $5 price of admission for an actual Division I basketball game.

But I have to admit, it would have been far more thrilling if I could’ve plunked down a legal bet while I rooted on the Keydets.

When it comes to college sports, Virginia has a cornucopia of Division I offerings within its borders.

There are college football’s big boys: UVA and Tech. They’re two of the four FBS programs in Virginia (with Liberty University and Old Dominion University) and six more institutions can be found in the FCS subdivision: Hampton University, JMU, Norfolk State, University of Richmond, VMI and William & Mary.

Additionally, the state is rich with Division I basketball programs. Richmond and Virginia Commonwealth University, some of the more prominent mid-majors, are among them.

If only Virginians had a local and legal way to bet on those games.

Competition for Virginia’s sports betting market

Virginia is the 11th largest state in the US by household income ($72,577) and 12th by population (8.5 million).

A 2019 legislative study concluded that Virginia’s mobile sports betting revenue could approach $400 million by maturity in 2028. The number could swell to $462 million if the planned casinos in Bristol, Danville, Norfolk, Portsmouth and Richmond, which could offer in-person sports betting, are also operational.

Quite simply, it could be a massive and lucrative landing spot for sportsbook operators. However, as the Caesars representative recently argued, bettors will turn to the markets where they can get what they want. The ban on Virginia college betting could force them to hit the road.

For Virginians, they don’t have to go far. When Virginia sports betting formally launches, likely in early 2021, they face competition from nearly all directions.

Five states and Washington, DC, border Virginia. Five of those six locales either offer sports betting (West Virginia and DC, for example) or soon could (Tennessee is just months away). None, though, have implemented the types of restrictions on in-state and other college sports wagering that Virginia has.

In all, Virginia could have up to a dozen sportsbooks when the VA Lottery issues licenses and the market is humming. That includes seven online-only options. It also boasts a manageable tax rate of 15% for operators. Lawmakers and regulators have assured it’ll be a competitive marketplace with options galore for customers.

It’s just a shame that sportsbook operators won’t be able to offer the most alluring betting options because of the ban on Virginia college betting.