06/20/2013 3:30PM

Dave Tuley: New Jersey carrying on the fight for legal sports books

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LAS VEGAS – Nevada has it. New Jersey wants it. But what we all should be focusing on is the fact that millions of Americans want it as well. “It” is legalized sports betting.

For those who don’t know, Nevada has pretty much had a monopoly on sports betting in this country since 1992, when the Professional and Amateur Sports Protection Act passed and shut the door on states that hadn’t previously offered sports betting. Montana, Oregon, and Delaware were grandfathered in, but New Jersey let the deadline pass.

Montana hasn’t resumed sports betting, and Oregon has just offered parlays through its lottery system. In 2009, Delaware tried to get full-fledged sports betting like Nevada but was limited to the parlay cards that it had offered before the PASPA.

New Jersey, a state struggling like everyone else in the current economy, has been trying to get back in the game and legalized sports betting in the state in 2012, but the professional sports leagues and the NCAA (as well as the Department of Justice) brought a lawsuit against the Garden State and won the case when federal district judge Michael Shipp granted a permanent injunction Feb. 28.

New Jersey’s argument is that the PASPA is unconstitutional. The reasoning is that since sports betting isn’t regulated on a national level, it is a states’-rights issue. New Jersey also argues that it’s unfair that some states are able to have it but not all.

The sports leagues and the NCAA say sports betting hurts the integrity of the games and opens them up to fixing. One of their other points is that New Jersey was hypocritical when it included a provision to not accept bets on games within its state. But their biggest argument is that the PASPA makes it illegal for Delaware to offer sports betting, and the law is the law (they want to treat it like a penalty that’s not reviewable by instant replay).

New Jersey appealed the ruling, as expected, and its case will be heard Wednesday at the Circuit Court of Appeals in Philadelphia. Both sides have filed briefs, and each side will have 30 minutes to present its case. The whole sports-betting world will be watching since a lot is at stake.

While the sports books here have the so-called monopoly, everyone believes the expansion of gaming helps everyone in the industry both from a credibility standpoint as well as financially. When Atlantic City, N.J., opened casinos in 1979, people said those on the East Coast wouldn’t travel to Vegas anymore, but instead, it increased the market for everyone. The same thing happened with Native American casinos as well as the poker boom earlier this century.

This reminds me in so many ways of Nevada’s fight in 2001 as Congress sought to ban college-sports betting here. The first thing I would suggest is to drop the partly admirable stance to not accept wagers on New Jersey’s teams and instead stick to the argument that regulated sports betting is the way to go.

That’s what Nevada did in 2001, when the NCAA called the state’s books hypocritical for taking bets on college students in other states but not on Nevada’s. The Gaming Commission chairman at the time, Brian Sandoval (who is now Nevada’s governor, which just goes to show how powerful the gaming industry is here, as it launched him to the top post in the state), said, “You know what? They’re right.” Within a few months, that gaming regulation was abolished, and Nevada has been able to bet on state schools ever since.

Nevada is the gold standard, the model for legalized sports betting in this country. For years, offshore books have printed “Vegas rules” when it comes to resolving disputes or have just copied the house rules of Vegas sports books without attribution. There’s no doubt that Jersey is trying to copy Vegas’s model, and it’s also clear that if it’s successful, Nevada casino companies will have a piece of the pie (Note: William Hill has already signed a deal with Monmouth Park to host its sports book if/when it is legalized, and more alliances are sure to come).

Now, this isn’t to say that Nevada always gets it right, and even though I’m a big fan of the state and the industry I cover, there have been decisions that I’m against.

It took way too long for the state to allow cellular phones to be used in the books here. “Two-way communication” devices (such as cellular phones and beepers) were banned inside the books in 1998 because they were used by illegal runners to get the lines from sports books and give them to their bosses. That was understandable when cell phones weren’t that popular, but then the world changed, with seemingly everyone having these devices.

The people whom the rule was aimed at could just access the same information on the Internet (or get the line and just walk outside the book to make a call). Meanwhile, Joe Tourist would get a call from his wife about dinner plans, and he’d get reprimanded by security. It took until 2008 for the state to get with the times.

We could be seeing a similar situation with horse-racing rebates, which also were outlawed in 1998 (due to California tracks pulling their signal from Nevada because they felt the state’s books should be paying more for the tracks’ signals if they were able to afford rebates to players), but now there’s a push to reinstate those since the world has changed in that way, too, with offshores and advance-deposit-wagering companies giving rebates to players.

But on the downside, the state legislature recently took two actions that prevented the sports books from maximizing their profits. Kiosk wagering at local bars – which as “restricted licensees” have traditionally only been able to offer slots and video poker, as opposed to “non-restricted” big casinos that offer all the table games, etc. – was ruled illegal even though Leroy’s and now William Hill had been allowed to do it for years.

It obviously hurts William Hill, but it’s a bigger blow to bettors who have loved the added convenience of not having to go to the Strip or a local casino to place a bet (though smartphone apps remain legal, thankfully).

Another bill to legalize syndicate betting also was shot down last month, mostly over concerns about how to regulate it, though I’m skeptical about how much handle that would bring to the state. Groups already are betting now, and if new groups want to pool their money and shop for lines in Nevada, they’re going to do it whether syndicate betting is officially sanctioned or not.

It all comes down to the fact that people want to gamble, and the powers that be should recognize that and work together to make it as easy as possible while regulating the activity (and reaping the tax dollars).

It really is a win-win situation if they can get it done, and the time clearly is now to enter a new era of open and legalized sports betting and to get all these issues resolved both here and everywhere.

Good luck, New Jersey.

DavidMichaels14 More than 1 year ago
I think the trend has finally turned against prohibition in the US, whether it be for drugs or sports betting. It seems that the people want legalized sports gambling, some politicians want it, businesses are open to it, but a few powerful politicians with inordinate power are keeping it from happening, or at least slowing its progress.
Neil Granowitz More than 1 year ago
I have watched this issue since 1992. Personally I want, wish and desire Sports wagering. The current culprit is Judge Michael Shipp. The previous culprits were Senator Bill Bradley who in my opinion because of his opposition committed economic treason to the citizens of NJ. But that was ok I fixed his political wagon by getting all my gambling friends to support and aid for Al Gore instead of Billy in 2000 when Billy ran for President. The other culprit was a man named Chuck Hytaiyan who was the Speaker of the NJ Assembly and ran for Governor in the 1990's. NJ had a chance to get " Grandfathered in" but he reused to Post the bill in the NJ Assembly. I fixed his wagon too as I spoke to and lobbied all my gambling friends to vote against him when he ran in the General Election. BTW HE LOST BIG TIME!!! This isssue is paramount to me as it will increase my economic wealth. So if you are a politician and do not support this measure, you will reap my electoral wrath at the ballot box