PASPA Overturned!

PASPA Overturned!

With today’s momentous Supreme Court ruling, PASPA’s overturn (7-2, Sotomayor and Bader-Ginsberg dissenting) opens the door to legal sports betting across America. An activity that was once monopolized by Nevada thanks to the Professional and Amateur Sports Protection Act (1992) is now open to residents in all states that wish to support such.

Of course, this doesn’t mean that it will be immediately possible to drive to your local casino and place a sports wager. The real outcome of today’s decision to eliminate PASPA is simply that states are now able to make their own sports betting laws and enforce them as they see fit. Instead of being regulated (and largely banned) by the federal government, sports betting will now be a state’s rights issue. Many states have already passed legislation to allow the activity upon PASPA’s elimination, and many more currently have bills passing through their congresses that address the issue.

Of course, before sports betting takes off in any state that allows it, the requisite infrastructures will have to be established, from where and when bets can be placed to how much such bets will be taxed to the methods of verification (both personal and financial) that wagering outlets will have to employ re their customers.

Generally speaking, it seems likely that most of the states where commercial casinos currently operate will institute sports betting schemes reasonably quickly, while other states will struggle to establish any betting industry within their borders. A conservative estimate is that about a dozen states will be ready to offer sports betting within their borders by the time the NFL season gets underway this fall.

States without casinos but with other forms of legalized betting – like horse racing betting – will likely use their existing track-based venues to allow the activity. That should, at least at the outset, cover most states in the country (roughly 40 or so). That said, this will not be a particularly rapid nationwide rollout, but sports betting will almost certainly be available somewhere in your state within a year’s time. (The exceptions to this are Utah and Hawaii, both of which outlaw all forms of gambling and have yet to address legalized sports betting, even though they are two of the top five most depressed states economically and could desperately use the financial boon).

One last hurdle to consider is that there will almost certainly be fierce debate in states where tribal casinos operate (especially where they operate exclusively). The argument from the Class II and III tribal casinos is simply that sports betting – if available anywhere in the state – must also be made available to their operations, with the existing tax benefits established in their various tribal compacts. Some of these casinos have exclusive rights to all betting in their states, which could be even more problematic. Tribal rights could become a protracted argument, and it wouldn’t be surprising to see such a case come before the Supreme Court in the years to come. Hopefully, calmer heads will prevail and the states with tribal compacts will respect them.

Overall, today, May 14, 2018, is a watershed moment in the history of American economics and industry. But nothing will be immediate, and you should definitely expect baby steps. Sports betting is an estimated $400 billion industry, after all, and there will be competing interests in every single state where the activity is legalized. If sports betting comes to your area, it will probably take some time.

So in the meantime, you can continue to wager on sports at USA online sportsbooks as you always have, via legal online sportsbooks (Bovada, SportsBetting, et al.). Because until you can hop on the Internet and place your bets legally inside your own state, there’s no reason to put too many eggs in the “PASPA is Dead” basket. Yes, it’s dead. But other laws are coming.