[toc]The Pennsylvania House Gaming Oversight Committee held a hearing on Tuesday to talk about the possible future of sports betting in concert with a resolution introduced late last year urging the U.S. Congress to repeal a ban on sports betting.
The PA sports betting resolution
The bill calling for a repeal to the Professional and Amateur Sports Protection Act — HB 619 — was introduced in December of last year. Tuesday was the first time the committee had taken up the resolution, although it was not voted on, and thus remains in committee.
The resolution, if passed, would urge “the Congress of the United States to lift the Federal ban on sports betting and to allow states that authorize, license and regulate casino gaming, including the Commonwealth of Pennsylvania, to legalize sports betting through its licensed facilities.”
The resolution notes that sports betting is going on throughout the state and the U.S. in an unregulated environment already, and that the law is ineffective.
More from the resolution:
WHEREAS, Even amid strong Federal laws banning sports betting in the United States, reports highlight that illegal sports betting is widespread and is considered the number one form of gambling among American residents; and
WHEREAS, According to a 2008 report conducted for the National Basketball Association’s Board of Governors, some estimates have the total volume of sports betting in the United States at $325 to $400 billion, with less than 1% of betting taking place in legal form; and
Democratic chair of the committee Nick Kotik, one of the co-sponsors of the resolution along with Rep. Rob Matzie, spoke about the state being ready for the possibility of sports betting in Tuesday’s hearing.
“I think Pennsylvania has to be ahead or the curve, we have to be proactive. We don’t know if this is going to happen,” Kotik said on the possibility that sports betting could open up in the U.S. “We were ahead of the curve when we established the casino law .. and we’ve been proactive, and that’s what I think (committee chair) John (Payne) and I are trying to do in the committee.”
Why is the resolution needed?
It is likely that PASPA would need to come off the books at the federal level for Pennsylvania — or just about any other state — to offer sports betting.
Currently, only four states can offer sports betting of any kind — Nevada, Delaware, Oregon and Montana. Those four states have forms of sports betting that were grandfathered into the law, which was passed in 1992. Nevada is the only state authorized to offer single-sport betting.
New Jersey has already passed a bill allowing sports betting in the state. But it cannot offer sports wagering while in the middle of a protracted legal battle with the major North American sports leagues and the NCAA, which are attempting to stop the state from offering sports betting. A rehearing in the case is set for February in the Third Circuit Court of Appeals.
If New Jersey wins its court battle, that could open up the possibility of Pennsylvania and other states trying to offer sports betting without a PASPA repeal; the NJ case hinges entirely on the language in PASPA.
PASPA and fantasy sports
The resolution also seems to be the latest indication that some forms of regulation of the daily fantasy sports industry that are being considered could run into PASPA issues.
Again, from the resolution, a few paragraphs are dedicated to fantasy sports:
WHEREAS, The proliferation of fantasy sports betting, primarily daily fantasy sports contests played through Internet websites, has become a household occurrence, with the Fantasy Sports Trade Association estimating that 56.8 million people play fantasy sports and bet an average of $465 a year on fantasy games in the United States; and
WHEREAS, Fantasy sports betting, primarily through Internet websites, blurs the lines with regard to sports betting in general, and the Federal Government has left the determination of the legality and regulation of fantasy sports to states;
Attorney Daniel Wallach recently did an analysis of DFS regulatory schemes and possible PASPA issues they bring up. A bill in New York state also acknowledges that PASPA could be a concern.
Pennsylvania is interested in regulating the DFS industry — a hearing on the subject was held in November — but what form that regulation might take remains to be seen. Some legislators, in public comments, have seemed to indicate they favor a heavy-handed online gaming or casino-style regulatory scheme. A bill introduced in the spring would have allowed the state’s gaming facilities to offer fantasy contests.
It’s not clear if anyone would actually try to block DFS regulation, however. The major sports leagues all are in favor of DFS or invested in DraftKings or FanDuel, leaving the NCAA as the only real possible plaintiff for an alleged PASPA violation against a state.
PA and gaming expansion
If sports betting became a possibility with PASPA concerns alleviated, it seems highly likely that Pennsylvania would move to legalize sports betting quickly, given talks that have already happened in the state in the past year.