“AGA strongly believes no additional federal engagement is needed at this time based on the significant, effective regulatory oversight already in place.”
The above sentence represents the underlying tone of a letter the American Gaming Association (AGA) sent to Sen. Chuck Schumer on Sept. 13. The message was in response to Schumer’s framework for federal sports betting legislation.
AGA to Schumer: We’ve got this! Thanks, anyway
The six-page letter signed by Sara Slane, senior vice president of public affairs for the AGA, argues the AGA’s position on Schumer’s proposed plan. Slane claims the US Supreme Court’s decision to render the Professional and Amateur Sports Protection Act (PASPA) unconstitutional was the “essential first step” to tackling the illegal sports betting market.
“Bringing sports betting activity into a transparent legal market, under state and tribal regulatory oversight, empowers law enforcement to tackle illegal gambling, provides essential consumer protection and better ensures bet and game integrity. It will also create new American jobs and generate additional local, state and federal tax revenue.”
The letter outlined five “principles that will ensure a safe, successful, legal sports betting market.”
The AGA asserts proper management of the legal sports betting market will do several things. It will create jobs, generate generous tax revenues, and attract consumers to legal sports betting operators. To ensure those outcomes, the following key areas should remain in focus:
- Promote responsible gaming and responsible advertising
- Protect game integrity
- Discourage enacting legislative preferences for specific business interest
- Empower state and tribal regulation
- Place consumers first
The bottom line, Shane writes, is:
“Replacing an already proven regulatory regime with a non-existent and untested federal oversight apparatus would be out of step with 7 in 10 Americans who think this decision should be left to each state and tribe.”
Who thought Hatch and Schumer were two peas in a pod
The major sports leagues failed to convince states to entertain the idea of integrity fees in sports betting legislation. As a result, they started focusing their lobbying efforts at the national level.
The leagues are not only seeking integrity fees but also seeking a mandate to require payment for the use of the leagues’ data.
It all began when Sen. Orrin Hatch started spouting the idea of federal sports betting legislation back in May. At the end of August, he took to the Senate floor and promised to introduce legislation in the coming weeks.
“Parts of the legislation I will be proposing are improvements in monitoring and enforcement that will benefit all stakeholders, sportsbooks, regulators, governing bodies and consumers,” Hatch said.
Federal sports betting and the leagues
Schumer, on the other hand, seems to be playing right into the sports leagues’ hands.
He suggests that sportsbooks use official league data to determine outcomes. He also wants to give significant power to the leagues by suggesting they decide what bets should be accepted.
While Schumer stops at suggesting an integrity fee, integrity is on his mind.
Schumer said in a statement:
“As a New York sports fan — especially my Yankees and Giants — and a senator, my priority in the wake of the Murphy v. NCAA decision is making sure the integrity of the games we love is preserved, that young people and those suffering from gambling addiction are not taken advantage of, and that consumers that choose to engage in sports betting are appropriately protected.
“With the Supreme Court’s ruling, it’s incumbent on the federal government to take a leadership role and provide the necessary guidance to prevent uncertainty and confusion for the leagues, state governments, consumers and fans alike.”
Federal legislation is unlikely in the near term
It is improbable that federal legislation will happen any time soon.
Even if a federal mandate finds support outside of a few senators and the sports leagues, one simply has to reflect on the political landscape to realize how implausible it is.
The country is entering into a heated and combative midterm election season. It seems like the fight for control of Congress will be the main focus of both parties through November.
Secondly, the US sports betting market is not going to wait for federal legislation. Four states have already joined Nevada and launched legal sports betting post-PASPA:
- New Jersey
- West Virginia
NJ sports betting, in particular, is on a hot streak, with eight retail sportsbooks at casinos and racetracks and eight online sportsbooks.
Additionally, Pennsylvania has passed legislation and has plans to launch sports betting potentially within the next month, as does Rhode Island. Several other states, including Schumer’s home state of New York, will potentially take up sports betting when their legislatures get back to work.
The process is working as it should with states regulating the activity within their borders.
In case there is any doubt, Shane reaffirms the AGA’s position: “Additional federal engagement is not warranted at this time.”