A panel of current and former gaming stakeholders reaffirmed opposition to a sweeping federal sports betting regulation bill Thursday, reiterating their stance against what would be the most expansive regulatory legislation since the Supreme Court struck down the federal wagering ban six years ago.
Speaking during an industry webinar Thursday, former long-time New Jersey Division of Gaming Enforcement director David Rebuck denounced the bill as well as the federal government’s role in gambling overall. Citing what he called the successful state-by-state regulatory frameworks in the 38 states with legal sports betting, Rebuck said the new federal proposal steps on decades of experience in Nevada and now the growing number of legal sports betting jurisdictions.
“It's mind-boggling to me in the arrogance of saying ‘we know more than you do’ without working on things together that we have already reached out to them to work on to make things better for our citizens in all the states that legalize sports wagering,” Rebuck said during a webinar organized by industry advocacy group iDEA Growth Thursday.
Federal bill draws swift opposition
The Supporting Affordability and Fairness with Every Bet Act (SAFE) introduced in the House and Senate earlier this month would restrict sportsbook advertising, limit deposits, regulate artificial intelligence, and create unprecedented federal oversight. Virtually all aspects of the bill are opposed by most industry stakeholders.
If the bill passes in its current form, all sportsbooks would need approval from the federal Justice Department, instead of (or in addition to) state-level regulators. Rebuck, and other industry stakeholders, have said this is an unduly burdensome impediment for books that have spent years working with individual state governments and tailoring requirements that best fit each jurisdiction.
Among the groups opposed to a recently introduced federal sports betting regulatory bill:
— Ryan Butler (@ButlerBets) September 19, 2024
- Former/current state-level regulators
- State lawmakers who wrote and passed sports betting bills
- Major gaming advocacy groups
- And, of course, sportsbooks
No sportsbook would be able to accept more than five deposits from any individual customer over a 24-hour period. Customers would also be forbidden from funding sportsbooks using credit cards and would be subject to affordability checks if wagers exceeded certain thresholds.
Sportsbooks would no longer be able to advertise between 8 a.m. to 10 p.m. or during live sporting events. This is a non-starter for sportsbooks that have spent hundreds of millions attracting new customers to the legal market, said Cory Fox, FanDuel's government affairs vice president, during Thursday’s webinar.
“It really would cut down on our ability to acquire users into the regulated and taxed market away from the illegal market,” Fox said.
In criticizing the new regulations, stakeholders have also pushed back against what they consider the federal government’s inaction within the current gambling environment.
The American Gaming Association has led efforts to push the Justice Department to crack down on hundreds of offshore sites taking billions of dollars in estimated bets each year. Though state regulators have had some success forcing out some major offshore sites, licensed sportsbooks and state regulatory bodies have joined the AGA in calling for the feds to take action that, by national law, only they can take against sportsbooks operating outside the U.S.
“We don't have a really good record on this right now,” Rebuck said about federal crackdowns on offshore operators. “There are some actions that have been taken in the past, some good ones, but anybody who looks at this and considers it being a very successful performance, I think has to take a step back to say ‘we need to do more in this.’”
Passage remains unlikely
The widespread industry opposition reaffirms the difficulty a sweeping gambling bill faces passing Congress.
The threats gambling companies fear from federal regulatory approvals and sweeping advertising restrictions will lead them to lobby hard against such a bill. These companies have spent billions launching their products since the 2018 Supreme Court ruling and will undoubtedly invest more in protecting their products.
The bill is already opposed by influential members of Congress including Nevada Rep. Dina Titus, whose district includes the Las Vegas Strip.
Congress’ difficulty passing any legislation could be a more arduous hurdle.
Titus has worked for years to remove the federal excise tax placed on each sports bet. Despite bipartisan, bicameral co-sponsors to remove the tax – and questions from Titus, Rebuck, and others about how the tax revenues are allocated – the bill has not received a vote in either chamber. Election year politics through the remainder of 2024 further complicate what appears to be an uphill legislative journey.
This is good news to state lawmakers who have worked for years crafting individual state-specific regulatory frameworks.
“If the federal government sees that legislatures individually are not acting in the safety of the, you know, the general public, then obviously there needs to be someone to step in,” said Massachusetts state Rep. David Muradian, who backed his state’s 2022 sports betting legislation. “But I think ultimately leaving it to the individual states to decide is probably the best bet.”
