Sharp Drop in Sports Betting in Iowa in April

The seasonal legal sports betting slowdown has begun with Iowa representing the best example yet of what we can expect from the nation's best sportsbooks in April and beyond.

The Iowa Racing and Gaming Commission released its April revenue report Wednesday, and they revealed sharp month-over-month drops in handle, revenue, hold rate and tax contributions from the betting sites to needy state coffers.

Iowa's legal sports betting scene hit the news wires for another reason this week. It has to do with cheating allegations surrounding apparent suspicious activity and the Iowa Hawkeyes baseball team. Iowa's potential baseball scandal follows a similar story out of Alabama last week in which the state's university team violated stringent gambling rules.

Eye-opening financials

The Iowa Racing and Gaming Commission is fully aware of the looming slowdown for sports betting in Iowa. But the state's legal sports wagering decline this year was swift, and it was drastic for Iowa's best betting sites.

Iowa sportsbooks reported $172.5 million in bets for April, which represents a concerning 25.8% drop from the $232.6 million wagered in the Hawkeye State in March. April 2023's betting totals in the state were about $5 million less than the $177.4 million from April 2022.

Drop in revenues

Iowa legal sports betting revenues followed the state's handle into a hole in April. Gross gaming revenues came in at $14.1 million in April, a whopping 28.8% less than the $19.9 million from March. The hold rate for Iowa sports betting providers came in at 8.2% in April, down from 8.5% the month before.

Year-over-year, April revenues from the state's wagering sector were actually higher. $12.4 million in sportsbook profits was reported in April 2022, compared to the $14.1 million last month.

As far as taxes paid by sportsbooks to Iowa state and local coffers, they dropped too - from $1.29 million in March to $958,605 in April. In April 2022, just $836,881 in tax contributions came from the state's betting sites.

Scandal anyone?

On the heels of the Alabama NCAA baseball betting scandal comes a similar problem with the Iowa Buckeyes baseball program.

Earlier this week, the Iowa Racing and Gaming Commission reported that four players were sent home due to a “due to a potential violation," which is widely expected to be in connection to stringent gambling policies that players are expected to abide by.

There is more to come on this story. No states or participating U.S. sportsbooks have yet to remove Iowa Hawkeyes baseball from their betting boards. 

Let's hope that the Iowa situation doesn't follow a similar path as the Alabama NCAA baseball in which the coach has now been dismissed, and there are unseemly connections between him and bettors in his state.