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Have you ever put money on your bracket in the office March Madness pool? Maybe made a friendly wager on the outcome of the Super Bowl or World Series? What about that lucrative Fantasy Football league you participate in? Millions of Americans spend billions of dollars each year on sports betting, but most don’t know—apart from licensed bookies in Nevada—betting on the outcome of a single game or event is illegal.
The Professional and Amateur Sports Protection Act (PASPA)of 1992 is a federal law that bars all but a handful of states from enacting laws to legalize sports betting. This means, even though a majority of voters in a particular state favors legalizing sports betting, there’s no way for the state to legalize it.
CEI has a long-standing interest in protecting consumers’ rights to make their own decisions. We believe PASPA’s de facto federal ban is actually unconstitutional, and on December 4, it’ll have its day in court. In the Supreme Court case, Christie v. NCAA, CEI filed an amicus brief supporting New Jersey’s right to repeal its state law banning sports gambling, as its citizens voted to do in 2011.
The Tenth Amendment puts important restraints on the federal government when it comes to laws governing individual states. According to recent lower court rulings, PASPA not only prevents states from legalizing sports betting but also prevents them from repealing current state laws that make it illegal.
PASPA undermines federalism, threatens states sovereignty, makes government less accountable to voters, and interferes with the ability for citizens to have a voice in their own state laws. The federal government should not be allowed to hijack states’ law-making authority.
How many Americans gamble on sports, and where do they do it?
Nearly one-third of Americans gamble on sports, according to a recent study by Oxford Economics. While many simply place wagers among friends, many also utilize the services of illegal bookies, online and offline. Often, these bookies have connections to international criminal outfits and the proceeds fund other illegal activities.
How much money per year do Americans spend on sports betting?
Researchers estimate that Americans spend upwards of $400 billion a year gambling illegally on sports. Individual sports gamblers spend an estimated $1,500 per year on sports betting.
When is sports gambling legal, when is it illegal, and what does the federal government have to do with it?
The Professional and Amateur Sports Protection Act of 1992, prevents any state, territory, or tribal authority from legalizing any sports gambling activity not already authorized prior to 1992 (not including pari-mutuel betting on animal racing or jai-alai, a sport similar to racquetball). PASPA leaves just three states – Nevada, Oregon, and Delaware – with any form of legal sports betting, and only Nevada may offer legalized single-game wagering, bets placed on individual football games or other sporting events.
But in reality, the federal government doesn’t enforce its own prohibition. Instead, opponents of sports betting – like the National Football League (NFL), the National Collegiate Athletic Association (NCAA), and other national sports associations – have sued states that sought to circumvent PASPA. For example, the NCAA sued New Jersey after its legislature attempted to decriminalize sports betting by eliminating state laws that prohibit the activity.
Can states decide for themselves whether to legalize sports gambling?
No. Only the three states that had already legalized sports betting by 1992 can regulate the activity. For all the other states, federal law prohibits them from authorizing sports betting in any way or even decriminalizing the activity.
Do American sports fans want sports betting legalized?
A recent survey found that 3 out of 4 sports fans want states to be able to decide whether or not to legalize sports betting. While gambling was viewed as a moral issue a few decades ago, most states now recognize the value of providing consumers with legal avenues to enjoy such activities. Every state but one, Hawaii, currently has some form of legal gambling.
Who is harmed if sports gambling remains illegal, and who stands to gain if it’s legalized?
Organized criminals win the most from the current black market on sports betting, while consumers and states lose. Consumers who want to gamble on sports have no other choice than to go to illegal bookies, which turns ordinary citizens into unwitting criminals. The ban also prevents states from instituting consumer protections and from collecting millions of dollars in tax revenue. Worse, it makes it more difficult for authorities to identify and spot crime or match-fixing. Even the sports leagues recognize the benefits that sports betting has on their own profits, as evidenced by their direct support of daily fantasy gambling.
There is a sports gambling case before the U.S. Supreme Court this year. What does that mean?
The state of New Jersey and the New Jersey Thoroughbred Horsemen’s Association have asked the Supreme Court in Christie v. NCAA to consider whether or not PASPA violates the Tenth Amendment of the Constitution. The Tenth Amendment holds that powers not delegated to the federal government by the Constitution are reserved for the states and individuals.
The Supreme Court will weigh in on whether states truly do have a Constitutionally-guaranteed right to decide how to regulate commerce within their own borders or if, instead, the federal government may force its will on state legislatures and residents. The Court’s decision will impact states’ abilities to regulate other pursuits, like marijuana, gun control, and education policy, without the undue influence of Congress.
What else should people know about this issue?
PASPA is a failure and a threat to our system of government. It is long past time we let states and individuals decide for themselves when and on what they should bet.
The purpose of the Professional and Amateur Sports Protection Act was to protect our nation’s sports leagues. Fearing the spread of legal sports gambling would cause spectators to question the outcomes of games, leagues convinced Congress to take the decision out of states’ hands. It is not Congress’ or the American people’s job to protect the reputation of profit-generating businesses, especially when doing so damages our nation’s founding principles.
Even if one believes Congress should protect American sports from the threat of match-fixing, PASPA has been shown ineffective and even counterproductive. While leagues in Europe, where sports betting is widely legal, rely on the gambling industry as its early warning system for corruption in sports, U.S. bookies can’t report evidence of match-fixing even if they wanted to for fear of prosecution.
- Brief of Amicus Curiae: Christie v. NCAA (2017)
CEI along with Pacific Legal Foundation, and the Cato Institute submitted an Amicus brief supporting New Jersey in their challenge to a federal prohibition on the state’s ability to repeal their own gambling ban.
- Legalizing Sports Betting in the United States (2018)
A playbook for state libralization and regulation
- Let States Regulate Sports Gambling Within their Borders (2017)
What are the constitutional principles at stake in the Supreme Court Case Christie v. NCAA?
- Time to End the Madness Around March Madness (2017)
How will legalizing sports wagering increase consumer safety? And how does the current ban threaten state sovereignty?
- Supreme Court Agrees to Hear Sports Betting Case (2017)
Will the Supreme Court end the madness?
- Law Enforcement Joins Coalition to End Sports Gambling Ban (2017)
The launch of this new coalition can capitalize on the unprecedented support and, perhaps, finally convince Congress to repeal this counterproductive, unfair, and unconstitutional prohibition
- End the Madness: Let Adults Bet on Sports (2017)
Your March Madness bracket isn’t just a fun pastime — it’s a violation of federal law.
- Take a Gamble on Sports Betting (2017)
On Super Bowl Sunday, millions of Americans will violate the law.