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Volume 25 No. 29
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Sports Betting Fallout: Orrin Hatch To Introduce Federal Legislation

Hatch didn’t detail what his bill would do, but his office said it would set a standard for sports betting
Photo: GETTY IMAGES

Sen. Orrin Hatch (R-Utah) said that he "would unveil legislation soon on sports betting after the U.S. Supreme Court struck down a federal law that had prohibited it outside Nevada," according to Thomas Burr of the SALT LAKE TRIBUNE. Hatch "didn’t detail what his bill would do but his office said it would set a standard for sports betting that would 'uphold the integrity of the game,' protect consumers, safeguard against underage and problem gambling, and ensure that states that do not want sports betting won’t have to accept it." Hatch said that he "would introduce his legislation in the coming weeks after speaking to his colleagues and those involved in the gambling business and sports associations" (SALT LAKE TRIBUNE, 5/15). Hatch's Dir of Communications Matt Whitlock said, “It will be up to each state to decide whether to legalize sports gambling and how to regulate it." He added Hatch "believes we need to ensure there are some federal standards in place to ensure that state regulatory frameworks aren’t a race to the bottom." THE HILL's Wheeler & Carney noted Hatch is "one of several original" co-sponsors of the Professional & Amateur Sports Protection Act of '92 (PASPA) that was struck down yesterday. Any legislation enacting new regulations "could have to pass through the Senate Judiciary Committee, where Chairman Chuck Grassley (R-Iowa) is one of five senators who originally opposed PASPA." Grassley has not commented on yesterday's ruling, but his support "could be crucial to getting new legislation onto the floor of the Senate." U.S. Rep. Frank Pallone Jr. (D-N.J.) is "calling on Congress to consider his legislation allowing states to legalize sports and online gambling." Under the Gaming Accountability & Modernization Enhancement Act, or GAME Act, states "would have to meet certain baseline consumer protections such as licensing facilities, following age restrictions, collecting taxes and protecting against crime and compulsive play in allowing sports wagers" (THEHILL.com, 5/14).

START FROM THE TOP: Mavericks Owner Mark Cuban hopes there is a federal approach to sports betting as "opposed to everybody having to deal with each stage individually." He said if that is "difficult in the short term, it’d be really smart for the commissions from as many states as possible to work together to standardize things." That would "enable the most creativity." Cuban: "When each state has its own set of rules and requirements, that jacks up the expense for everybody which minimizes the entrepreneurial opportunities and unique technology opportunities." He said legal sports betting "doubles the value of professional sports franchises in a second." He added it will "increase interest" and "add to what happens in our arena and in stadiums, it will increase the viewership for our biggest customers online and on TV." Cuban said it also "helps traditional television, because traditional television is much lower latency where online, because they cash, it’d be a much longer latency” (ESPN.com, 5/14).

PLACE YOUR BETS: The NFL in a statement said that it was "hopeful Washington would act, saying its 'long-standing and unwavering commitment to protecting the integrity of our game remains absolute.'" However, POLITICO's Hutchins & Gerstein reported supporters of sports betting were "skeptical lawmakers could achieve such a goal" (POLITICO.com, 5/14). In Atlanta, Jamie Dupree wrote the major pro sports leagues "don’t want different rules in fifty different states dealing with sports gambling." But can Congress "really come up with something like that?" (AJC.com, 5/14). In Charlotte, Scott Fowler writes there "will be much to hash out," including whether people should be "allowed to gamble on college teams based in their own state." Another question is whether sports betting will "only be legal in the casinos that are scattered across America, or will there be small betting shops all over the place, as you can now find in London?" Fowler: "Will you be able to place bets on your phone while the game is going on, trying to predict who will score the game's next touchdown? It will require a lot of thought to do this right" (CHARLOTTE OBSERVER, 5/15).

NEW SOURCE OF INCOME: The AJC's Dupree wrote the ruling brings a "new source of revenue for state governments." In a time of "tight budgetary resources, the ability to allow for sports gambling would also give states the opportunity to tax not only the gaming operations, but also the winnings" and all the "associated activities related to sports gaming" (AJC.com, 5/14). West Virginia has proposed a state tax rate of 10% on "general gross revenues from sports betting." Gaming research firm Eilers & Krejcik predicts that resulting in an additional $13.4M in annual tax revenue "coming to the state in the first year of sports betting, with the amount rising" to $28.7M by year five (Wheeling INTELLINGENCER, 5/15). However, USA TODAY's Paul Davidson cites sources as saying that while the ruling "may provide some pocket change" for state governments, it likely will not be enough to "help head off looming budget crises in a few years." Rockefeller Institute of Government analyst Lucy Dadayan: “I don’t think that for any state it’s going to make a huge difference" (USA TODAY, 5/15). Meanwhile, in Boston, Battenfeld & Chabot note the ruling "could sprout a whole new bureaucracy to cover sports betting, similar to how the Massachusetts Gaming and Cannabis Control commissions were created to control casino gambling and legalized pot sales" (BOSTON HERALD, 5/15). 

OPEN TO OUTSIDE INFLUENCES? In Chicago, David Haugh writes legalized sports gambling "sounds as prosperous as it could be perilous." What is the "over/under on the number of NFL players, coaches or support personnel who just became bigger targets for injury information by ne’er-do-wells?" This "increases the revenue but also the sleaze factor, every sports organization’s biggest fear." It is "naive to think this won’t tempt hard-core gamblers from trying to infiltrate sports teams for any edge to place legal bets" (CHICAGO TRIBUNE, 5/15). But in Chicago, Barry Rozner writes wealthy pro athletes are "very unlikely to throw games," as it is "not 1919" (Chicago DAILY HERALD, 5/15). In Ft. Lauderdale, Dave Hyde writes the "chance of sitting beside some lunatic fan going crazy after a meaningless free throw in the final second of a nine-point game will rise off the charts." Hyde: "That’s my only concern" (South Florida SUN SENTINEL, 5/15).

FROM THE EDITORIAL BOARD: A WALL STREET JOURNAL editorial states everyone who "favors individual liberty should agree" with the ruling. Cultural mores regarding gambling have "changed over the past century, and one of the last remaining taboos is against gambling on sports contests due to the opportunity for corrupting the competition." The Court’s "full-throated defense of federalism should be welcome on both the political right and left" (WALL STREET JOURNAL, 5/15). A CHARLOTTE OBSERVER editorial states sports gambling "just became mainstream." It went from "being pot to being cigarettes -- not quite embraced, but not so illicit." Betting just became "less of a dirty word" (CHARLOTTE OBSERVER, 5/15). A USA TODAY editorial notes states have been "given the green light to enter the sports betting racket," but just because they "can doesn't mean they should." State involvement in gambling "comes with significant costs," as its proceeds "often flow to out-of-state corporations that manage casinos." Sports betting "comes with a second problem: the potential for corruption." Congress should "get into the act of regulating sports betting" (USA TODAY, 5/15). A N.Y. DAILY NEWS editorial states, "We can and must hold the line here, however, by preventing sports bets outside of the full-fledged upstate casinos where other forms of gambling are already allowed, and where sports betting was prospectively authorized, pending federal action, in 2013." There are "profound social and economic consequences of making it fully frictionless" for fans to "put the week's paycheck down on the Eagles plus five-and-a-half" (N.Y. DAILY NEWS, 5/15).