Colorado Sports Betting Diagnosed As ‘Really Healthy’ Heading Into 2022

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There is a natural instinct to take stock as the calendar approaches Jan. 1. So, in the spirit of the season, how do those charged with regulating sports betting in Colorado view the industry in the state, 20 months in?

The prevailing sentiment is that things are going quite well.

“Overall, the environment is really healthy in Colorado,” said Colorado Speaker of the House Alec Garnett, who sponsored the 2019 measure that legalized sports betting in Colorado. “We were one of the first states to move forward, primarily with an open marketplace online, to draw people out of the black market, overseas, and offshore. Overall, it’s working.”

Getting rid of the ‘black market’

Progress toward eliminating illegal sports betting in Colorado is high on the list of accomplishments regulators in the state point to, with the rationale that it protects consumers. Both Garnett and Dan Hartman, the director of the Colorado Division of Gaming, feel those efforts have succeeded faster than expected.

“There are two ways of looking at it — from the regulatory perspective and the customer perspective,” Garnett said. “We went into this thinking about the customer and thinking about the safest environment — try to put yourself in the shoes of someone who is already doing this and getting paid by an offshore company in VISA gift cards that don’t show up for a year. … In the long run, the most important thing to remember is it can be done legally and safely. There’s always going to be things to learn along the way.”

In a discussion about elevated advertising from gambling operators in Colorado, Hartman acknowledged that, even though the flood of ads might be irritating to the general public, the positive effect has been a massive migration from illegal to legal wagering.

“Would we have been as successful moving people out of the black market without this kind of thing?” Hartman mused of the ads. “We’ve moved an awful lot of people, faster than we thought, out of the black market and into the legal market, and that’s a good thing.”

Focus on responsible gaming

But that doesn’t mean there won’t be adjustments to sports betting in Colorado, and Garnett made a comparison to legalized marijuana. Sports betting and marijuana offer different challenges in the state, but after nearly 10 years of legalized weed in Colorado, Garnett made the point that state legislators are still discussing laws and policy.

“It’s a different model, but there are more dispensaries in my district than Starbucks,” Garnett said. “Years later, there are still 10-15 bills each year about marijuana.”

If there is anything to be tweaked in the coming years, it likely will be in the sphere of problem gaming. Hartman said current policies in place work well, but they don’t entirely eliminate the challenges of outreach and funding.

“The big tweak comes either this year or next year,” Hartman said. “What is the solution or funding mechanism for responsible gaming and how do we go through that? I think that’s the big thing with us.

“The legislature tried to put something in, that met where the responsible gaming people were comfortable. But I think, after we see everything we’ve got, and as big as the market is, and as many people as are involved, we need to have a different [revenue]  stream and probably a more active role from the [Division of Gaming]. Not in therapy and that … but more on the exclusionists, who are making sure that, when people want help, they get help.”

More sharing among operators could help

That might mean some sort of mechanism that works across platforms and even across operators. When someone gets flagged for problem gaming at a sportsbook, should they get flagged by other operators, or at a casino, or at a racetrack?

“We have operators who have responsible gaming on their mobile app and have the ability to reach out or push pause, but what we need to do is, if they do that, we need to take that and get them excluded or paused from all of it,” Hartman said. “Even though you’re bringing people on, you have to know some of the people you bring on are not going to be able to do it, just like casino gaming and all the different things that are out there.

“It has to be part of the equation, part of the business plan, and most of [the operators]do a pretty good job of that. It’s just how do we get the funding to make it work?”

But monitoring behavior doesn’t only extend to the customer. From the regulators’ perspective, how operators behave in a very competitive environment, with new industry players appearing frequently in a battle for market share and the landscape evolving, is key.

“The most important thing to take away from Colorado is that we can regulate it and it can be safe for consumers, but with any market, there’s tinkering,” Garnett said. “I believe the operators want to do it right on problem gaming. The big guys want to do it right, but there may be a period of time where the smaller guys feel the pressures of competing. One thing to keep an eye out for is if it encourages bad behavior.”

Photo: Shutterstock

Jeremy Balan has been a journalist, editor, and sports writer since 2007. After years covering prep, college, and pro sports for online and print media, he focused on turf writing at BloodHorse from 2015-2019 and won an Eclipse Award for his coverage of the devastating fire at San Luis Rey Training Center. Contact Jeremy on Twitter (@jeremybalan) or through email at jbalan@bettercollective.com.

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