A US senator will introduce new measures to regulate sports betting in the US after the lifting of a former ban.
Powerful anti-gambling United States Senator Orrin Hatch, the president pro tempore of the Senate, quickly promises federal sports-betting legislation in the wake of the US Supreme Court’s striking down of the quarter-century-old “PASPA” law banning the activity.
Less than 24 hours after the Supreme Court of the United States (SCOTUS) reversed a lower-court decision involving the 1992 Professional and Amateur Sports Protection Act (PASPA), effectively ruling the PASPA ban on sports betting in the US unconstitutional, US Senator Orrin Hatch has announced plans to introduce new sports-wagering legislation on the federal level.
Sen. Hatch, the president pro tempore of the US Senate and third in line in the chain of succession to become the country’s president, is the long-serving senior senator from the US’s most anti-gambling state, Utah. He was one of the four original sponsors of the PASPA bill and has been an avid backer of numerous anti-gambling bills through his entire career.
According to the senator, the same justifications for federal oversight remain, regardless of PASPA’s demise: “The problems posed by sports betting are much the same as they were 25 years ago. But the rapid rise of the Internet means that sports betting across state lines is now just a click away. We cannot allow this practice to proliferate amid uneven enforcement and a patchwork race to the regulatory bottom. At stake here is the very integrity of sports. That’s why I plan to introduce legislation in the coming weeks to help protect honesty and principle in the athletic arena. I invite stakeholders and my colleagues on both sides of the aisle to join me in addressing this important issue.”
Straw-man arguments surface
Senator Hatch’s disparaging of state-level regulatory schemes and misleading claims regarding interstate online gambling suggest greater intent. Hatch was a primary co-sponsor of the prominent “RAWA” (Restoration of America’s Wire Act) anti-online gambling bills introduced in Congress in recent years. Among the claims of the bills’ sponsors was that residents of one US state could easily gamble on another state’s regulated online sites.
Such claims as Hatch’s that “sports betting across state lines is now just a click away” are demonstrably false, if not outright lies designed to pander to Utah’s Mormon majority, anti-gambling base. The geolocation protocols mandated in every US state authorizing online gambling to date have blocked all such interstate activity. It is inconceivable that any US state would join the ranks of online-authorizing states without rigorous geolocation and ID-verification systems in place.
A supporting quote from Hatch’s Senate Office reemphasized the false claim:
“It will be up to each state to decide whether to legalize and sports gambling and how to regulate it. But given that sports betting activity can now be conducted across state lines via the Internet, Senator 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.”
Today, no regulated online sites offer gambling services in any form to Utahns; only a small number of unregulated offshore offerings allow gamblers from the state to participate. Similarly, Hatch’s focus on internet wagering amid debate over a sports-betting issue is itself similarly misleading. Utah is the only state in the continental US west of the Mississippi River to not have any land-based casinos, though sports wagering is available just an hour and a half’s drive from Salt Lake City at multiple large casinos in West Wendover, Nevada.
New federal-v-states battle looms
Hatch’s history and beliefs suggest that his new efforts will be as close to a replacement for the federal ban as law and current US social standards allow. Hatch cited the summarizing quote from SCOTUS Justice Samuel J. Alito’s majority opinion as the rationale for his effort. According to Justice Alito, PASPA was ruled unconstitutional because the law forbade state-level legislators from addressing the sports-betting issue in its entirety.
However, there’s nothing that stops the federal government from placing severe restrictions on such activity while leaving it up to the states themselves to consider a blanket ban. Justice Alito wrote this in summarizing SCOTUS’s ending of PASPA:
“Congress can regulate sports gambling directly, but if it elects not to do so, each State is free to act on its own. Our job is to interpret the law Congress has enacted and decide whether it is consistent with the Constitution. PASPA is not. PASPA “regulate[s] state governments’ regulation” of their citizens…. The Constitution gives Congress no such power.”
Legalized sports betting is thus set to enter a growing category of topics actively pitting state and federal interests against each other. Among the most prominent of those is the marijuana legalization topic, which was featured prominently in the New Jersey Thoroughbred Horseman’s writ of certiorari plea to the US Supreme Court.
Several US states have legalized the sale and use of marijuana in recent years, in direct contradiction of the US federal government’s ban on such activity. Marijuana remains listed among the federal government’s collection of controlled substances, meaning that thousands of pot growers, processors and retail sellers in these legalized US states remain under the potential threat of federal arrests, fines, and lengthy imprisonment. Such a territorial battle has yet to erupt, but it remains a possibility.
“Integrity fee” chances increase
The reopening of a federal-v-states battle over sports wagering has another aspect not hinted at in Hatch’s statement, but present nonetheless. That involves the “integrity fee” lobbied for by the US’s prominent sports associations, to be paid to those groups, as part of any legalization effort.
The original PASPA law was introduced as the Bradley Act in 1991 by former NBA basketball star and then New Jersey US Senator Bill Bradley. The effort to expand and strengthen the US’s existing ban on sports betting (already covered in part by the 1961 Wire Act) was designed to strip the ability to offer sportsbook-style wagering from a new wave of casinos opening across the US, particularly in Atlantic City but also at hundreds of new tribal casinos across the country.
The original PASPA effort was heavily financed by the US’s wealthy and powerful sports organizations, especially the National Football League (NFL). Along with the NBA, MLB, NHL, and college’s NCAA. These are the same groups that sued to block New Jersey’s plans to introduce legalized sports wagering when New Jersey voters approved it a decade ago.
However, public attitudes on the topic have changed. In the face of PASPA’s unpopularity and predicted demise, these associations have instead pushed forward the concept of an “integrity fee”.
Though framed in noble terms—and Sen. Hatch’s statement uses some of the same phrasing—the real intent is to extract some form of data or rights usage from the sports-betting industry and general public.
The extent to which these sports leagues are entitled to such a fee is unclear at best. The leagues have lost previous cases involving the public use of sports information and results as might be used for wagering purposes, and the leagues have little interest in pursuing the flip side of the equation.
For instance, in the US, all television services are now broadcast via cable or satellite, and all such services include ESPN in their basic service packages. ESPN charges by far the highest single channel fee of all such channels, and a portion of what that channel and other sports-based networks charge goes directly to the NFL and other major sports groups in licensing fees. In other words, if one watches TV in the US and subscribes to any cable or satellite service, that person is paying money to the NFL and other sports leagues, whether watching sports or not.
Such mandatory tithing is the basis for the integrity-fee push, and the US sports associations have already successfully inserted such integrity-fee provisions into sports-wagering bills under consideration in several states. The leagues’ lobbying power in Washington, DC foretells similar integrity- or usage-fee provisions being present in any federal bill, whether as a superseding provision or a revenue-based double dip.
The leagues will be active on the federal front. “Today’s decision by the Supreme Court opens the door for states to pass laws legalizing sports betting,” NBA Commissioner Adam Silver said in a statement. “We remain in favor of a federal framework that would provide a uniform approach to sports gambling in states that choose to permit it, but we will remain active in ongoing discussions with state legislatures. Regardless of the particulars of any future sports betting law, the integrity of our game remains our highest priority.”