Legalized sports betting is good news for NASCAR, but how much of an impact it will have is unclear
Don’t expect the recent Supreme Court ruling to be a gold mine for NASCAR, racetracks and teams in the coming months.
But it certainly could be, well, let’s say, an interesting roll of the dice.
The court’s decision to strike down the Professional and Amateur Sports Protection Act, a 1992 federal law that barred state-authorized sports gambling, has opened the door for states beyond Nevada to legalize sports betting.
Wagering on NASCAR races already is legal in Nevada, and the ruling is expected to increase the number of states where it’s legal in the coming months.
But NASCAR isn’t exactly the most profitable of sports. According to the Nevada state gaming control board, sportsbooks in Nevada made $87 million in profits off of football bets in 2017, $76.9 million on basketball, $42.4 on pari-mutuel horse racing and $36.8 million on baseball.
The statewide gaming reports would lump NASCAR into an “other” category that includes boxing, mixed martial arts, soccer, tennis and golf that had a combined 2017 profit of $32.3 million — and NASCAR likely wasn’t a huge part of that.
“Interest can be generated for NASCAR and a lot of different sports just because people will now have a betting interest in the outcome,” said Denis McGlynn, who is CEO of both Dover International Speedway and Dover Downs Gaming & Entertainment. “I’m not sure from an operator standpoint that [sports gambling] is going to be super material because it’s such a low-margin business. … From a NASCAR standpoint, I think it’s a positive. I’m just not sure it moves the needle [for a casino].”
The likely amount of profit for NASCAR bets when they are bets on who wins the race likely would be 30-40 percent of the total amount wagered, according to Micah Roberts, a former Vegas sportsbook director who writes columns, including those about NASCAR betting, for Sportsline and VegasInsider.
He said prop bets would generate approximately 12 percent profit, while driver matchup bets (betting one driver would beat another) likely would turn a 1-2 percent profit.
If at-track betting could have had a significant financial impact, it’s likely Las Vegas Motor Speedway already would have done it. Track general manager Chris Powell said the track did look at putting in slot machines, but non-casinos can’t have more than 15 and he didn’t feel that was worth getting a license and operating the machines. The thought of running a sports book from the property was never deeply explored, he said.
“To do it once or twice a year I think is cost-prohibitive to set up a satellite sports book, and I don’t see that changing,” Powell said. “What I do see changing is the opportunity for fans to use their mobile devices to place wagers.”
If tracks are in states that move forward with betting (Delaware, New York and Pennsylvania have NASCAR Cup races and are among states that potentially could have sports betting soon), they likely will have to apply for a license. Most experts believe a track would work with a casino or sportsbook — such as William Hill, which already has apps for people to wager on sports — to operate betting.
Even a place such as Dover couldn’t just put kiosks on the racetrack property immediately. McGlynn said because the motorsports venue is not part of the gaming company’s premises, they would have to work with the Dover lottery (which licenses the casino) to get approvals.
He said if mobile betting is not immediately available, there is an opportunity for tracks to have areas for fans to bet at the track.
“Until they get mobile with the opportunities, I think the answer to that is yes,” McGlynn said. “However, once they go mobile, you’ll be able to bet from anywhere. … Live audience [benefits are] if a fan can whip out their phone during the race and bet on the next stage and bet on in-race kind of betting for outcomes during the race, it could be really a [part of] to NASCAR’s whole business model.”
The question is how NASCAR could try to get a piece of the action (and would it have any responsibility to pass profits on to the teams). Major League Baseball, for instance, is asking for 0.25 percent on all bets placed on its sport as part of state legislation, according to The Wall Street Journal.
“A lot still has to unfold with how this is all going to be administered,” McGlynn said. “I’m not sure at this point if the federal government is going to try to control it or if they’re going to leave it all up to the states to do their own thing. You could have different laws in different states.”
Powell said he believes there could be opportunities for NASCAR, the tracks and teams to get a piece of those revenue streams.
“There are so many different wagering opportunities, and what I think will be interesting to see [is] what sanctioning bodies, what league offices are supportive of these new opportunities for fans to make wagers and will they become part of the gaming industry?” Powell said.
NASCAR at the moment isn’t tipping its hand.
“[We] will continue to monitor what the ruling will mean for individual states and our sport,” NASCAR said in a statement when asked about its interest on sports gambling.
And it is likely no one knows exactly what it means. Let’s look at it this way: Let’s say a race generates $1 million in bets. That likely would be $300,000-$400,000 in profit. If the track split the proceeds with a sportsbook that operates automated kiosks, then the track’s take would be $150,000-$200,000. And then there would be any costs for licenses. And taxes. And if split among NASCAR (and 40 teams?), the question would be whether it would be a significant piece of revenue.
Roberts said when he ran a sportsbook, the betting on the Vegas races would do about the same amount as a wild-card NFL football game.
“Now more than any time ever they should embrace it, because it keeps people involved,” Roberts said. “It’s great for the sport. It’s a great opportunity.”
Roberts envisions tracks encouraging people to download an app (run by a third-party sportsbook) to bet during the race, and that could be a way for tracks to generate revenue by getting a commission on fans who download the app in addition to any cut of bets placed while on track property.
If tracks work with a third-party sports book, that could help relieve any worries of anyone about the integrity of the game. International Speedway tracks, if they operated betting kiosks, could come under scrutiny because those tracks are owned primarily by the France family, which also owns NASCAR (and is responsible for the officiating of the event).
Roberts said he didn’t feel NASCAR officials or competitors would be targets to throw races. He said the profits off of bets that could be matchups between two drivers wouldn’t be enough to pay an official and the crew member.
“What could an official do, what could a crew member do? You are talking about winning a race out of 38 drivers — that’s impossible to fix,” Roberts said.
What about penalties NASCAR issues later in the week? Roberts said because NASCAR typically doesn’t change the finishing order that it wouldn’t be an issue with sportsbooks whether the winner is penalized after the race.
The one other concern would be whether NASCAR fans, many already spending hard-earned money for a vacation to go to a race, would end up ruining a vacation by losing money wagering on the race.
“People need to be careful of betting habits and such, but I’m all for it,” said 2015 NASCAR Cup champion Kyle Busch, who grew up in Las Vegas. “It’s fine. It brings and adds more attention to our sport. People will kind of take interest it and find ways to make money around it.
“That’s all good. That’s going to have people paying attention and eyes on television. I don’t know why we’re not like horse tracks — bet on us right there at the racetrack. … They do it for horse racing, so why not ours?”