US States Spent $145m of the $188m Set Aside for Problem Gambling Services in FY2025

US states spent about $145 million of the $188 million they allocated to problem gambling services in FY2025, and 48% of funded states spent at least 5% less than their budgets, according to the national association of state administrators. The share has barely moved since FY2023, which makes it a capacity problem rather than a one-off.

• US states allocated approximately $188 million to problem gambling services in FY2025 and spent approximately $145 million, according to the budget update published in July 2026 by the National Association of Administrators for Disordered Gambling Services (NAADGS)
• 48% of the states with funded programmes spent at least 5% less than their allocation, 50% came within 5% and 2% overspent; the report does not name the states that underspent
• The report blames procurement delays, staffing and contractor shortages and budget increases that arrive late in the fiscal year rather than falling demand, and its FY2023 edition found almost the same split
• National Council on Problem Gambling (NCPG) board president Derek Longmeier called the gap a warning sign on 12 October, as the council prepares for its executive director's departure and faces exits over its Kalshi arrangement
• Allocations reach about $204 million in FY2026, while state-regulated sportsbooks paid $3.71 billion in taxes in 2025, up 32.4%, according to the American Gaming Association (AGA)

Nearly a Quarter of the Money States Allocated for Problem Gambling Went Unspent

The NAADGS budget update, prepared by Problem Gambling Solutions, Inc., found that 43 states funded problem gambling programmes in FY2025, generally the year to 30 June 2025, with combined allocations of approximately $188 million. Known expenditure was approximately $145 million, a gap of about $43 million, or 23% of the money allocated. Seven states and the District of Columbia had no dedicated funding.

Data were collected between March and June 2026 from state administrators and checked against budget documents, with official documents preferred where the two conflicted, the report says. All 43 funded states reported FY2025 spending, but the report does not publish it by state. The only state it names in its spending analysis is Oregon, which overspent because unspent funds from prior years were no longer carried forward.

The common causes were procurement delays, staffing challenges, contractor shortages and budget increases received well into the fiscal year, according to the report, which says the gap "does not necessarily indicate a lack of demand". It warns that underspent budgets can threaten future allocations: the District of Columbia's was eliminated in FY2024 to address a budget deficit after going unspent for several years.

Allocations are still rising, from approximately $94 million in FY2021 to $204 million in FY2026. The five best-funded states hold about half the total, and per-capita allocations in FY2026 ranged from $7.40 in Massachusetts to $0.02 in South Carolina.

The NCPG Makes the Case for a Federal Partner

Longmeier, who also runs the Problem Gambling Network of Ohio, wrote on 12 October that the gap represented prevention campaigns that did not run and treatment places that went unfilled, and that unspent money "becomes misleading evidence for legislators" that it was not needed. He called for gambling disorder to be treated alongside substance use, noting that no federal agency funds or oversees its services. He cites the report's estimate of roughly $75 of public funding per person affected by gambling disorder, against $919 for substance use disorders.

The Underspend Is a Fixture, Not a Blip

The NAADGS FY2023 update found that about half of funded states spent less than 95% of their allocations, for the same procurement, staffing and late-budget reasons. Two years and $54 million of extra allocations later, the split is almost unchanged. That supports the NCPG's reading that money is arriving faster than state systems can absorb it. The counterpoint is in the report too: a state handed a sports betting windfall is not neglecting anyone by taking a year to contract services. Without spending by state, nobody outside can tell which states are building capacity and which are sitting on money.

The $75 Figure Needs Its Footnotes

The comparison sets $188 million of state money against about 2.5 million people, a figure the report sources to the NCPG's own website, and against a $44.5 billion federal drug control budget that includes enforcement. The report argues the real gap is wider, because state and local substance use spending is left out. The direction is not in doubt; the 11-to-1 ratio is built from unlike numbers. The NCPG piece also says the report identifies workforce as the biggest driver of underspending; the report lists it among several factors without ranking them.

The Messenger Is Under Pressure, the Numbers Are Not

The argument comes from a council under strain. The NCPG announced a $2 million, two-year investment from Kalshi in May, and the Ohio and Michigan regulators and the Nevada and Washington state councils have since left it. Families and Friends of Gamblers, is recruiting its affiliates, and Nevada's regulator has moved to strike the NCPG from its helpline rule. None of that touches the NAADGS data. The fiscal backdrop matters more: state-regulated gaming generated $18.09 billion in taxes in 2025, according to the AGA, and the $188 million allocated is roughly 1% of that, a loose comparison of fiscal and calendar years.

Money for problem gambling is growing faster than the systems built to spend it. If the gap persists, the District of Columbia shows how budget writers may choose to close it.