Ahead of a subcommittee meeting surrounding federal involvement in legalized sports betting, two members of Congress have penned a letter advocating against such inclusion.
And they did not mince words in doing so.
Tom MacArthur, a representative from New Jersey, and Dina Titus, from Nevada, sent the letter Tuesday to leaders of the House Subcommittee on Crime, Terrorism, Homeland Security, and Investigation. The committee will be hosting a hearing Thursday.
The hearing will include discussions on legal sports betting throughout the country and will no doubt feature debate on whether the federal government should get involved.
In opening their letter, MacArthur and Titus, whose home states both boast regulated sports betting, essentially provided a warning to the House subcommittee. (Read the full letter here.)
“As members from states that have already legalized, regulated, and opened the doors to sports betting, we have seen success of regulation at the state level and feel proposals for a federal framework should be approached with caution.”
State regulation works
Since state-sanctioned sports betting became a possibility in May, four states have rolled out regulated wagering operations. They join Nevada as the only states to have such offerings.
Among them is New Jersey, whose NJ sports betting industry has boomed since its June launch. It has further expanded with the addition of mobile wagering platforms within the past few weeks.
Two more states, Pennsylvania and Rhode Island, are expected to join the fold within the next couple months, while another handful of states could do so in 2019.
This all stems from the US Supreme Court electing to repeal what essentially amounted to a federal ban on sports betting. There is no need now, MacArthur and Titus declared, for the federal government to get involved once again.
From the letter:
“Precedent for federal policy toward gambling has been to assist states in the enforcement of their own laws, prohibiting gaming activities only where it is illegal under state law, rather than to preempt state law.”
MacArthur and Titus emphasize the regulatory framework used by Nevada since legalizing sports betting in 1949. The system in place in the Silver State, one used as a template for other state-sanctioned industries, has been the gold standard. Laws prohibit patrons younger than 21 from wagering while requiring the state to have self-exclusion programs for those with gambling addiction.
Additionally, the letter said: “Operators, working with data companies, are required to monitor bets for instances of possible match-fixing, and share evidence with the Nevada Gaming Control Board, which then investigates and determines the proper course of action.”
These laws take hold in each state to protect the integrity of sports that politicians used as a tool to schedule the Thursday hearing.
Federal intervention will ‘suppress’ legal market
The authors of the letter note that the illegal sports betting market, not the legal industry, “lacks consumer protections and threatens the integrity of sports we know and love.”
Regulated wagering markets such as those in New Jersey benefit their respective states. Having the federal government involved will only hurt the states rather than protect them, MacArthur and Titus argue. This is especially true if the federal government requires states and their sports betting operators to give a cut of the action to the leagues.
From the letter:
“Call for integrity fees paid to leagues would chip away at state revenues and already slim revenue margins for legal sportsbooks, hurting their ability to compete with offshore books and move more consumers into the regulated market.”
State-sanctioned sports betting also allows for other business ventures, such as a team partnering with a sportsbook (e.g. the Vegas Golden Knights and William Hill US) to create an environment of “fair and honest competitions and wagers,” according to the letter.
Federal involvement in legalized sports betting, MacArthur and Titus say, will cause the regulated industry to lose face.
“A heavy-handed federal framework could repress innovation and competition, sending more people back to the illegal market.”
Sports betting hearing set for Thursday
The House subcommittee is scheduled to begin its meeting (titled “Post-PASPA: An Examination of Sports Betting in America”) Thursday at 10 a.m.
Certainly, no action is expected to be taken on creating federal oversight of legalized sports betting, though Sen. Orrin Hatch and Sen. Chuck Schumer have come out in recent weeks imploring for federal guidelines.
Expected to testify at the meeting is American Gaming Association senior vice president of public affairs Sara Slane. The AGA’s take on the matter notes that “states and sovereign tribal nations — not the federal government — are best positioned to regulate and oversee legal sports betting markets.”
Others set to appear as witnesses:
- Jocelyn Moore, Executive Vice President, Communications and Public Affairs, National Football League
- John Warren Kindt, Professor, University of Illinois
- Jon Bruning, Counselor, Coalition to Stop Online Gambling
- Becky Harris, Chair, Nevada Gaming Control Board