Vermont’s forthcoming legal sports betting market is gaining momentum, with five prominent operators submitting license applications to the state regulator, the Vermont Department of Liquor and Lottery (VDLL). This significant development follows the passage of House Bill 127 in May, marking Vermont’s first substantial gaming expansion since the authorization of the Vermont Lottery in 1977.
Key Operators and License Requirements:
Five major operators—DraftKings, FanDuel, BetMGM, Fanatics, and ESPN Bet—have responded to VDLL’s Request for Proposal. The legislation allows for up to six online sportsbooks to acquire wagering licenses, with a minimum of two licenses required to launch online sports betting in Vermont.
VDLL will now review these applications, conducting suitability assessments for each operator, examining their key executives and shareholders, and evaluating the proposed regulatory conditions for each mobile sportsbook platform.
Bidding Details and Projections:
Vermont’s sports betting regulations include specific criteria for operators. They will be subject to a minimum tax rate of 20%, and licenses will cost a minimum of $550,000, valid for at least three years. The legal betting age in Vermont will be set at 21.
The VDLL has outlined the possibility of enhanced bids for securing a license. Proposals will be assessed on a scale of 0-1,000 points, considering factors such as the percentage of gross income shared with the state, projected gross and adjusted sports wagering revenues, and operators’ operational history in other legal sports betting states.
Market Potential and Suitability Concerns:
Vermont’s small population, ranking 49th out of 50 states, and the absence of major national sports teams or stadiums pose challenges for the market’s potential. Factors like skiing and snowboarding popularity, while significant in Vermont, may not traditionally drive substantial betting volumes.
The market is expected to generate annual revenues ranging from $2 million to $10 million, with tax revenues in the range of $1 million to $5 million. This is notably smaller than larger markets like New York, which consistently reports monthly revenues of around $100 million.
Vermont’s emerging legal sports betting market is attracting top-tier operators, signaling the state’s entry into the rapidly expanding U.S. sports betting landscape. While demographic and cultural factors may impact the market’s size, operators are positioning themselves to capture opportunities in this growing sector. The VDLL anticipates awarding the first online sports wagering licenses in the fall, with platform launches expected in early January 2024.