MORGANTOWN, W.Va. — A West Virginia University professor has his doubts about how much money would be involved in sports betting, but he does believe it will increase viewership of sporting events.
The West Virginia Lottery estimates approximately $1 billion will be bet in the first year of legalization, in which 95 percent would be returned to the betters. The remaining $50 million would be impacted by a 10 percent tax, meaning $5 million would go to West Virginia.
West Virginia University economics professor Brad Humphreys said last week on MetroNews “Talkline” the numbers seem based on little information.
“They’re just based on just complete guesses,” he said. “There’s no way anybody knows really what this will be. We’ll really have to wait and see what the uptake is before we know the revenue.”
The U.S. Supreme Court last week struck down a federal law banning states from passing sports gambling laws. The West Virginia Legislature passed a bill during the regular legislative session allowing the practice in the state.
Humphreys said the determining factors on increasing related revenue is centered on the growth in the legal betting market.
“Certainly, anybody who is currently betting with an illegal bookmaker will switch over to legal bookmaking, but I think there’s also a substantial number of people who will like to bet on sports but they’re just concerned about betting with an illegal bookmaker,” he said. “Those people will be new betters to the market. They will generate revenues.”
There are some concerns, said Humphreys, about the legality of betting on phone apps; the five state casinos are allowed under state law to accept bets made on their software as long as the phone’s user is in West Virginia. Humphreys said two federal laws which ban internet gambling and betting through the use of wire services could be used to challenge if this form of betting can be allowed.
“Both of those laws look to me like that could potentially apply to betting on mobile devices,” he said.
Humphreys said one effect he is positive about regarding sports betting is the impact on sports viewership; he said watching a sporting event and betting are complementary actions.
“The ability to bet on games will lead some people to watch games on television who wouldn’t normally watch it and that will increase revenues for leagues,” he said. “I do think it will expand the base for a lot of sports.”
One sport that Humphreys noted was NASCAR, which has seen a decline in attendance and television ratings over the last decade.
“I think it could potentially reverse the trend of NASCAR’s decline,” he added.