Momentum growing to legalize sports gambling

By Kulwant Saluja

The notion that American sports fans could legally gamble on sporting events would have been deemed absurd even a year ago.

But once a taboo subject, NBA Commissioner Adam Silver’s shocking pro-gambling comments in a Nov. 13 op-ed piece in the New York Times, has stimulated discussion on the subject, prompting other pro leagues and state legislatures to re-consider their stance on legalized sports betting.

Silver wrote that “In light of domestic and global trends, the laws on sports betting should be changed. … sports betting should be brought out of the underground and into the sunlight where it can be appropriately monitored and regulated.”

The NBA, as well as the NFL, NHL and Major League Baseball, have opposed the legalization of sports betting since the passage of the Professional and Amateur Sports Protection Act in 1992.

“There are other reasons including the rise of daily fantasy sports, but the Silver article was the pivot point,” said David Purdum who interviewed Silver for the cover story of ESPN The Magazine earlier this month.

“Up until Silver’s talk, you couldn’t even get the leagues to say anything about gambling. But Silver spent some time overseas in places like China, the UK – places where sports betting is legalized, regulated and monitored. His perception has started to change.”

Major League Baseball commissioner Rob Manfred, promoted to the post last summer, said baseball should examine its stance on sports betting in a February interview with ESPN’s Outside The Lines.

New Jersey has been at the forefront of the movement to legalize sports betting, signing it into law in 2012. But a U.S. District Judge issued a permanent injunction preventing the state’s casinos and racetracks from offering sports betting after a lawsuit by the NFL, NBA, MLB, NHL, and NCAA two years later.

The leagues said legalization of sports betting would violate the integrity of the game. The New Jersey case is scheduled to be heard by a federal appeals court next month.

“By fighting this issue aggressively, New Jersey is allowing the issue to be exposed long enough where people are starting to see holes in the argument of those who oppose gambling,” Purdum said.

Currently, Americans can bet legally, typically by betting at Nevada sports books, or illegally via offshore casinos and local bookmakers. Bettors are choosing the latter. The American Gaming Association predicted that as much as $3.8 billion would be bet illegally on the Super Bowl between the New England Patriots and the Seattle Seahawks, compared to the approximately $119 million bet legally on last year’s Super Bowl.

Though exact numbers cannot be verified,  illegal wagers dwarfed legal betting on this year's Super Bowl. (American Gaming Association, Kulwant Saluja/Medill)
Though exact numbers cannot be verified, illegal wagers dwarfed legal betting on this year’s Super Bowl. (American Gaming Association, Kulwant Saluja/Medill)

“There is obviously a market,” said Rep. Phyllis Kahn of Minnesota, who introduced legislation to legalize sports betting in her state in 2013, and proposed the same bill last week. “Since it is happening anyway, states should regulate it, which could generate revenue. I believe people would much rather do things legally than illegally.”

While acknowledging it’s still an uphill battle, Kahn said she felt there is a better chance to get the bill passed than in 2013.

Illinois is one state that doesn’t appear to have joined the pack, according to Tom Swoik, executive director of the Illinois Casino Gaming Association, a nonprofit organization that represents eight of the 10 gaming operations in the state.

“The state of Illinois has not taken any position on the issue and I have not heard any mention of the topic recently,” Swoik said.

Purdum predicted sports betting will become a reality but thinks what happens in the New Jersey case will dictate when.

“All of the legal experts think New Jersey has its best chance in their three-year battle,” Purdum said. “They are still the underdog, but if New Jersey is able to pull off the mild upset, this issue will escalate and escalate quickly.”

Purdum said if states really want to generate revenue, they will have to make betting legal online.

“If they don’t make sports betting [legal] online, there is just not going to be enough revenue to make it worth everyone’s while,” he said. “People aren’t just going to give up their [current gambling outlets] and the convenience of online, to place their bets at a brick-and-mortar place.”

Photo at top: When it comes to betting on sports legally, Nevada is one of few places to do so. But with states and professional sports leagues re-examining their stances, there may soon may be new options. (Antony Pranata/Creative Commons)