How Did Colorado End Up With So Little For Problem Gambling Programs?

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April 30 marked the official end of the first year of live sports betting in Colorado … but seven weeks later, problem gambling programs are still waiting for money to flow from the Department of Revenue into their accounts. And advocates say that the $130,000 earmarked for problem gambling initiatives in Colorado isn’t nearly enough.

Given Colorado’s population of about 5.7 million, that $130,000 works out to less than 3 cents per capita to handle problem gambling issues. Of course, not every resident will gamble, and most gamblers won’t encounter trouble, but since the introduction of sports betting on May 1, 2020, the National Council on Problem Gambling reports that the number of calls made to the national problem gambling hotline spiked by 35%. Between May-December of 2019, there were 3,563 calls as compared to 4,834 during the same period in 2020.

“Colorado has never had a strong commitment to problem gambling as it were,” said Brianne Doura-Schawohl, Vice President U.S. Policy and Strategic Development for EPIC Risk Management. “Those kinds of states don’t usually put a lot of money forth.”

According to the  2016 Survey of Problem Gambling Services in the United States, the average per capita allocation for problem gambling services in 2015 was 37 cents. That year, Nevada collected $1.4 million from all gaming revenue for problem gambling initiatives. The population is about 3 million people, and 576 new people enrolled in treatment in 2015, which translates into approximately 47 cents per capita or $2,430 available per person in treatment.

In Colorado, that same survey showed that officials funneled $269,000 of casino gaming tax dollars to problem gaming, which worked out to 3 cents per capita. The survey did not indicate how many Coloradans sought treatment or guidance. While the additional $130,000 that will be added from sports betting revenue will increase Colorado’s commitment, it will still be well below the national average.

Funding a tough sell from the start

Doura-Schawohl, who was formerly the director of government relations for the NCPG, oversaw her group’s efforts to get more money earmarked for problem gaming initiatives when the Colorado legislature was in the process of legalizing sports betting. She said her position is always that when a new type of gambling comes online in any state, more money should be tagged for problem gambling. But given Colorado’s history in this area and that legalization came via a ballot initiative, it was a tough sell.

“I started to get some momentum, but it was going to be difficult with the way the ballot measure was written,” she said.

So here we are, a little more than a year into legal sports betting in Colorado, and no money has yet been distributed to problem gaming initiatives. According to the Dept. of Revenue, monies from sports betting won’t be distributed until the fall due to in-house auditing requirements. That’s not specific to funds for problem gambling, but to any sports betting funds that must be distributed. The lion’s share of sports betting tax revenue is set aside for the state’s water initiatives.

The Colorado law sends $130,000 per year to problem gambling initiatives — $30,000 for a national gambling helpline and $100,000 for treatment programs. Given that the state has about 30 retail and digital sportsbooks and a population approaching six million, advocates say that number is terribly low.

“It’s not enough to provide the services that people are going to need for counseling over the long term,” Patrick Willard, director of policy and advocacy for the NCPG told CoBets. “It forces the groups that want to provide the assistance to have to fund raise outside the system.”

How far will problem gambling dollars go?

For more of a sense of just how little Colorado lawmakers set aside to handle problem gambling issues — which one advocate said is “just the cost of doing business” — consider that in Wyoming, with a population of about 550,000, lawmakers set aside $300,000 per year, or that Nebraska lawmakers earmarked 2.5% of sports betting tax revenue for problem gambling programs. That could work out to more than $1 million per year in a state with a population of just under 2 million — or 50 cents per capita vs. Colorado’s 3 cents.

Many states, usually those that have a long history in gaming, Willard said, set aside higher amounts to help those who become addicted.

“The states that have had the longest relationship with gambling are the states that have the most invested in problem gambling,” Willard said, pointing to Massachusetts, Nevada, New Jersey, and New York as examples. “In New York this year, where they were looking at going with mobile (sports betting), as part of that, they increased the funding to what looks like will be $6 million a year on top of a couple million they were doing before (via retail casino gaming). In Connecticut, they’re adding an extra $1.5 million, which should put them at about $3 million (per year) for problem gambling. So you’ve got those are states that had casinos for a number of years and dealt with the issue.”

Colorado won’t have the luxury of oodles of money to help those in need in the near future. But both Willard and Doura-Schawohl said advocates will watch as bills are filed in the state legislature for a way in. Advocates could push for a stand-alone amendment to the law or new bill to increase funding, or could try to have funds for program gambling added to any gambling bill in the legislature.

In the meantime, the people crafting problem gambling safety nets will have to figure out the best use of the available funds. The $130,000 is clearly not enough to help many with long-term care, and it’s not even clear if the idea that $30,000 will go to helplines and $100,000 to treatment is really the right breakdown.

“How far does that go? Really hard to assess if that’s the proper delineation of funds,” Doura-Schawohl said. “This is with the idea that a lot of people know that help exists. One question is whether there enough clinicians to treat people.”

Jill has covered everything from steeplechase to the NFL and then some during a more than 30-year career in sports journalism. The highlight of her career was covering Oakland Raiders during the Charles Woodson/Jon Gruden era, including the infamous “Snow Bowl” and the Raiders’ 2003 trip to Super Bowl XXXVII. Her specialty these days is covering sports betting legislation across the country.

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