Vermont’s Online Betting Expansion Attracts Top Operators Amid Regulatory Reform

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Vermont, the Green Mountain State, is taking significant steps in its sports betting expansion, and five potential operators are eyeing the opportunity with vim. Notably, Vermont has no physical casinos, and this sole focus on promoting online betting sets a unique tempo in the sector. The state’s first significant gaming expansion since the inception of the Vermont Lottery in 1977 is currently underway following Governor Phil Scott’s endorsement of House Bill 127 in June.

The state’s newfound legislation permits the granting of up to six digital sportsbook wagering licenses to suitably qualified operators. In the spirit of kickstarting online sports betting, HB 127 mandates the award of at least two licenses. Vermont recently announced the submission of five bids in response to its Request for Proposal. Prospective market entries include DraftKings, FanDuel, BetMGM, Fanatics, and ESPN Bet.

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The unfolded development has led to a new responsibility for the Vermont Department of Liquor and Lottery. Charged with overseeing the state’s sports betting liberalization, the department is set to sift through the five sports betting submissions, evaluate the fitness of each company and their respective key executives and shareholders, and assess the regulatory conditions introduced by each mobile sportsbook platform in their RFP.

Set within the broader context of Vermont’s sports betting regulations, all operators must adhere to a minimum gross sports betting revenue tax rate of 20%. Each license commands a fee of $550,000 and is valid for a minimum of three years. Importantly, online sports betting enthusiasts must be 21 years or older.

More interestingly, the RFP places increased weight on the element of competition among operators. They are tasked to present compelling offers to clinch one of the licenses. Officials from the Vermont Lottery and Liquor Department will score each bid within a 0-1,000 point range. An operator stands the chance of earning more points through a willingness to share a higher percentage rate of gross income with the state. Other factors contributing to the point tally are predictions of gross and adjusted sports wagering income.

Moreover, the applicant’s track record in other states with legal sports betting will significantly influence their overall score. A commitment to responsible gaming will also yield considerable marks. Points will also be allocated based on the operator’s demonstrated proficiency regarding technical abilities and regulatory safeguards. These include geolocation protocols, deposit and withdrawal functionality, and other customer protection measures.

Looking forward to the later stages of this process, the Vermont Lottery and Liquor Department is anticipated to grant the first online sports wagering licenses this fall. Prospective bettors can expect the new platforms’ launch at the onset of 2024.

While it is expected that at least four of the bidding operators will clear suitability reviews smoothly due to their established presence in related markets, ESPN Bet may encounter more scrutiny. Though backed by a partnership between Disney’s sports media giant and Penn Entertainment, complications arose following Penn’s recent disassociation with Barstool Sports and Barstool Sportsbook. This was in response to the regulatory issues that arose due to their connection with Barstool’s contentious owner, Dave Portnoy.

In considering the state’s aggrandized sports betting venture, it is pivotal to situate these developments in population demographics. With Vermont ranking as the 49th out of 50 states in terms of population size at just 650,000 residents, the viability of supporting four or five online sportsbooks in the market remains a question.