First Year Of Michigan Online Horse Racing Betting Attracts $35.8 Million In Wagers

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In 2020, residents of Michigan embraced the regulation of advance deposit wagering, contributing a staggering $35.8 million in online horse racing bets during the first partial year.

Over the course of the year, the increase in horse racing betting generated a remarkable $839,123 in state tax revenue, almost surpassing the taxes collected from simulcast betting at Northville Downs, the only remaining racetrack in the state.

With the Kentucky Derby approaching on Saturday, industry officials are optimistic about a more stable year for both forms of betting in 2021. The annual horse racing report from the Michigan Gaming Control Board highlighted the unpredictable nature of the previous year.

For horse racing enthusiasts, it is crucial to be aware that online sports betting operators will not be accepting pari-mutuel bets for Saturday’s Kentucky Derby. Instead, you must utilize one of the ADW options provided (refer to the first link above for further information).

The amount of money bet online, which reached $35.8 million, had already surpassed the $28.3 million wagered at Northville Downs through simulcast and live betting.

TwinSpires boasts market share lead over TVG

Last year, out of the $35.8 million spent on online horse racing bets in Michigan, TwinSpires, a subsidiary of Churchill Downs and one of the two operators available in the state, accounted for 62.1% of the total amount.

FanDuel’s TVG captured $13.6 million in wagers, accounting for 36.9% of the total.

TVG was introduced in June of the previous year, right after the Belmont Stakes commenced a modified Triple Crown series that was disrupted by the COVID-19 outbreak.

In perfect timing for the Kentucky Derby, TwinSpires obtained its license in September.

Xpress Bet has recently entered the scene, becoming the third approved operator in March of this year. The Ontario-based company has joined the fray.

Pre-license tax payment brings total closer to $1 million

Before its license was approved, TwinSpires had been operating in Michigan and had paid $480,598 in taxes on pre-license ADW wagers.

The aforementioned payment resulted in an overall sum of $839,123 in fresh revenue for ADW state taxes.

ADW additions were part of expanded gambling laws

In December 2019, Governor Gretchen Whitmer signed a set of gambling bills which included the inclusion of an array of betting options for horse racing.

While internet gaming and sports betting took the spotlight, the horse racing industry also experienced a surge.

Advanced deposit wagering enables Michiganders to legally place regulated horse racing bets from the comfort of their own homes, with the laws providing the necessary framework for this.

In order to adhere to regulations, the ADW operators must negotiate an agreement with Northville Downs, and the state would receive a 1% share of the total horse racing betting handle.

In addition to the 3.5% of simulcasting handle generated at the track, this figure contributes to the total amount.

Simulcasting, live racing at pandemic’s mercy all year

Simulcast betting, which allows Northville Downs visitors to bet on races happening worldwide, is restricted to the track’s operating hours.

Several months passed in 2020 without any bets being made.

The closure of Northville Downs took place almost five months after the initial March 18 pandemic shutdown, just a few days prior to the commencement of the live racing season.

The track initially opened on August 14th but temporarily closed again on November 18th, remaining shut for the remainder of the year. However, Northville Downs resumed operations on December 21st.

In addition, the amount of money bet on simulcast wagering decreased significantly by 55.0% in 2020, reaching $27.3 million compared to the $60.5 million wagered in 2019.

The state generated a tax revenue of $954,540 from simulcasting.

The ADW tax revenue increase of $839,123 compensated for the $1.2 million decrease in simulcasting tax revenue.

Only 27 racing days were held (52 were planned)

The Michigan Gaming Control Board had planned a total of 52 racing days for the year 2020.

Originally scheduled for March 20, the first event was rescheduled and eventually commenced in August.

The track successfully utilized 17 out of 18 approved days, and later received an additional 18 days. They managed to complete 10 of these days before the second closure occurred.

A total of 27 racing days took place in 2020, resulting in $1.0 million in betting. This amount represented a 53.2% decrease compared to 2019, where $2.1 million was wagered across 51 race dates.

During the year 2020, the amount wagered per race day was $37,116, which is lower than the $41,988 recorded in 2019. When the track reopened, certain restrictions were imposed on customers, including the mandatory use of masks and a limit of 15% capacity.

This year’s live racing schedule for 2021 commenced on April 2nd, with a total of 55 dates planned.