As expected on Wednesday, Gov. Mike DeWine has signed a bill legalizing sports betting in Ohio. Now the task begins of implementing a wagering framework that will span major league sports stadiums to local bars and restaurants.

DeWine’s signature marked an end to the three-year struggle to bring sports betting to the Buckeye State, one that at times was paralyzed by disagreements as numerous neighboring states legalized the practice and saw millions of sports betting dollars flow across their borders. The final compromise bill hammered out by the General Assembly and signed by DeWine on Wednesday ensures that sports betting will launch in Ohio no later than Jan. 1, 2023.

It marks a momentous day for the state, with New York sports betting expected to be the next to launch, potentially as soon as this month.

Ohio’s sports betting infrastructure will be overseen by the state’s Casino Control Commission, which will attempt to launch both retail and mobile wagering in tandem, and will offer three separate tiers of gaming licenses. Lawmakers expect 90 percent of sports betting in Ohio to be conducted online or over mobile phones, consistent with what other states have experienced.

End of a three-year quest

Getting to this point was no easy task for Ohio, which saw the neighboring states of Michigan, Indiana, Pennsylvania and West Virginia all legalize sports betting to some degree. The three-year quest to bring legal sports betting to the Buckeye State seemed to find a breakthrough in June when the state Senate passed a sports betting bill, only to see the House hold out.

It took a joint conference committee to iron out details and craft a bill that passed both houses of the General Assembly by wide margins on Dec. 8 — only a week before the end of the current legislative session. Under terms of the law, “A” licenses allow entities like sports teams and casinos to partner with online bookmakers, “B” licenses allow them to operate retail sportsbooks, and “C” licenses allow betting kiosks in bars and restaurants with liquor licenses.

Sports betting revenue in Ohio will be taxed at 10%. The bill allows pro sports teams and casinos up to two “skins” — industry parlance for an online bookmaker’s website and sports betting app — with the first costing $3 million and the second $10 million. “C” licenses for bars and restaurants allow up to two betting kiosks in each establishment for the placement of moneyline bets, prop bets and parlay bets involving up to four teams.

$5 million tax windfall ahead?

How much money can Ohio generate from sports betting? Michigan, which launched mobile sports betting on Jan. 22, 2021 and has a population slightly lower than that of Ohio, has reported $2.696 billion in handle and $4.928 million paid in state taxes on just mobile gaming so far this year. The Michigan tax rate of 8.4% is also lower than Ohio’s 10%.

Pennsylvania, whose population is slightly larger than that of Ohio, reported $5.59 billion in sports betting handle for the fiscal year that ended in June of 2021, with $5.135 billion of that coming via online betting. Those totals generated $16.369 million in state taxes, although Pennsylvania’s sports betting tax rate of 34% is the highest in the nation.