Lobbying fight heats up over sports gambling

LOS ANGELES — A major lobbying fight over the future of gambling on professional sports is poised to break out as powerful interests line up to influence Congress and states plotting to grab a piece of the billion-dollar pie.

In the wake of a U.S. Supreme Court decision in May that handed states the freedom to legalize and regulate sports gambling, dozens of states are preparing legislation that would give their citizens the right to wager on professional baseball, basketball and football games.

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That court decision upheld a New Jersey law that ruled against the 1992 Professional and Amateur Sports Protection Act, which banned sports betting in all but a handful of states.

Now, other states want in on the action, by levying taxes many legislators see as a potentially promising source of future revenue. They are being egged on by casinos and gaming interests that stand to make billions of dollars on their own.

“That’s where the money is,” said Ariana Kelly, a Democratic member of Maryland’s House of Delegates.

But the nation’s major professional sports leagues are hoping to slow down the process. They say they deserve to profit off wagers laid down on the games their teams play, and the athletes who play them.

League officials told legislators they were seeking a quarter of a percent of the money spent on games they run, a fraction they called an “integrity fee.”

“What we’re asking for, MLB and the other leagues, is a very small fraction” of money, Bryan Seeley, a senior vice president of Major League Baseball, told legislators at a forum on sports betting at the National Conference of State Legislatures (NCSL) annual meeting here. “We’re not looking to take money away from state tax revenues.”

Some state legislators are worried Congress may act to circumscribe their ability to regulate sports gambling.

NCSL, which frequently lobbies Congress to give states wider latitude to adopt their own policies, passed a resolution on Wednesday allowing its Washington office to begin lobbying Congress to stay away.

“They’ll go to the mat for this,” said one of the lobbyists who backs sports gambling in states. “NCSL will look at this as a preemption issue.”

Sports betting has been legal for years in Nevada, the only state that allowed bettors to wager on specific games. Since New Jersey’s victory, Delaware and Mississippi have joined in legalizing forms of sports wagering.

Bills have passed in New York, Pennsylvania, Rhode Island and West Virginia, though those measures have yet to be enacted. Legislation to legalize sports betting in some form has been introduced in 14 other states, and observers expect similar versions to be introduced in almost every state when legislative sessions begin next year.

“I think it’s more likely than not that we’ll have sports betting,” said Brian Egolf, the Democratic speaker of the New Mexico House of Representatives. “The question is, who’s operating it?”

States are debating the contours of their new measures, including which operators are allowed to run sports betting and how those measures are taxed.

In some states, like Wisconsin, Native American tribes operating the only legal casinos are likely to defend their monopolies, making it unlikely that sports betting would expand beyond existing gaming sites.

Jerry Sonnenberg, the Republican president of the Colorado state Senate, said his members are trying to understand how sports betting would fit in to the current gaming structure.

“Are these guys really a new player? Do they pull from the casinos?” he said. “Casinos obviously are somewhat protective of what they’ve accomplished.”

And opposition will exist, especially in states where social conservatives hold sway.

“There’s going to be some people who just generally think expansion of gambling is a bad idea,” said Elijah Haahr, a member of Republican leadership in the Missouri state House. Still, he said, he expects his state to adopt a regulatory structure allowing sports betting.

But the long-standing stigma about sports gaming has clearly dissolved. Where table games and slot machines were once the sole purview of a metropolis that embraced the Sin City label, gambling has now extended far beyond Las Vegas.

Forty states have some type of legalized gambling, including both the most liberal and most conservative states in the country. Twenty-four states have commercial casinos, and 28 states have casinos operated by Native American tribes.