Economics

Research Brief: State Legislative Update on U.S. Sports Betting & Online Gaming – April 2021

The more things change, the more they stay the same

A year after the start of the Great Shutdown, the gaming and sports worlds are returning. The NCAA Division I Men’s basketball tournament ran its course with no major problems. The Masters is in full bloom in Augusta, and MLB threw its first pitch at the start of this month. This is all occurring while fans are returning to games and events as stadium capacity increases.

Legislative sessions are also in full bloom, with most of these sessions hitting their stride as some deadlines have passed while others are fast approaching. Several states are trying to get sports betting across the finish line before their session expires. Many of these are running into challenges, not just from a timing standpoint but also due to the legislative process. As seen in Georgia, sports betting died because of the voter law and the difference between parties. This is just one example of how legislation can either be changed dramatically, get killed, or die under its own death through the sheer weight of the process of legislation. While the issues may change over time, the same factors can make or break the process and cause well-intentioned groups and caucuses come apart because of other issues.

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Research Brief: State Legislative Update on U.S. Sports Betting & Online Gaming – March 2021

March Madness is Upon Us

For the first time in two years, sports fans will be able to wager on the NCAA Division I Men’s basketball tournament.  While the tournament went dark last year because of the Great Shutdown, legal sports betting has expanded significantly across the country since last March.  However, this does not preclude though the office pools that will still take place, especially in jurisdictions that still do not have legal sports wagering.  The NCAA tournament is one of the largest wagering opportunities in the year, in addition to the Super Bowl that took place just over one month ago.

One of the challenges that will be faced those in legal states is the ability to wager on the ‘home team’, as several of these states have banned wagers placed on local teams and contests including college sports taking place in that jurisdiction.  States across the country are looking to provide these same athletes with the ability to profit from their name, image, and likeness (“NIL”) but provide them “cover” when it comes to wagers being placed legal on them.  However, keeping student-athletes off the legal books only allows an illegal market to continue, exposing these athletes to more harms than protections.  For the integrity of the tournament and student-athletes, the best place for any sports wager is in the legal market without restrictions.

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The Return of the Roaring ’20s: As the world recovers from Covid-19, the stage is set for a comeback; will Vegas lead the charge?

The 100-year anniversary of the roaring ’20s is upon us as the world finally begins to look toward new beginnings in a post-pandemic world.  Many have pointed out that the Spanish flu (which preceded the Roaring ’20s) is analogous to Covid-19, presenting a similar potential opportunity for the world to emerge from a pandemic with a new era of historic economic prosperity, which would include a boon to the hospitality, F&B and tourism sectors.

As eager as the world may be to return to “normal” life, it is vitally important that safety and health practices do not give way to pent-up demand and impatience.  Luckily, customers see a light at the end of the tunnel with vaccines being distributed and certain destinations gradually lifting restrictions.  While reintroducing global travel and entertainment will take time, deestination markets around the world will look to regain their share of the soon-to-be-rejuvenated global tourism market.

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Windy City Gaming: Chicago will finally plant its flag for a casino development

Casinos in urban environments, not always the norm, have offered challenges in certain jurisdictions.

Major markets such as Philadelphia have had casinos near downtown for years. Pittsburgh and Detroit also feature casino gaming in downtown settings. The Washington, D.C. market, with MGM National Harbor, has also made an impact. But in recent years, more developers have embraced urban environments to meld properties into the fabric of the greater communities they serve. Two of the more recent examples were in Massachusetts, with MGM Springfield and Encore Boston Harbor.

Some of the greatest opportunities for gaming expansion in the United States remain in urban settings. For years, New York, Atlanta, Miami, Dallas and Houston have been seen as potential expansion sites. But the most immediate opportunity exists in Chicago, which will locate a gaming development within the city itself.

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Research Brief: State Legislative Update on U.S. Sports Betting & Online Gaming February 2021

The buzz from this year’s Super Bowl continues to catch fire with the legal sports betting market as it continues to expand across the country. Almost every media outlet has talked about not only the matchup between the Tampa Bay Buccaneers and the Kansas City Chiefs (or Brady vs. Mahomes), but also a story about wagering, handle, the line, and some of the major brand names across the states that are conducting legal sports betting. This has been the case for several years, but sports betting has become much more mainstream.

This year’s Super Bowl did not offer the match up that everyone had expected between two premier teams featuring what many viewed as the ‘GOAT’ vs. the rising star “Kid.” Tampa Bay’s dominance in all facets of the game threw many sportsbooks off that had the line hovering around three to four points leading up to kickoff. The American Gaming Association prior to the game estimated that $4.3 Billion would be wagered.

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Research Brief: U.S. Court of Appeals First Circuit Wire Act Ruling

While most of the attention in the United States was focused on the Inauguration on January 20, 2021, the United States Court of Appeals for the First Circuit released its ruling on a case between the New Hampshire Lottery Commission and Neopollard, a lottery vendor, against the U.S. Department of Justice (“DOJ”) regarding the Interstate Wire Act of 1961. The suit was brought by New Hampshire in response to the memorandum issued by the DOJ’s Office of Legal Counsel (“OLC”) on November 2, 2018 (the “2018 Memo”), which stated that the Wire Act applied to all forms of gaming and not just sports betting. The 2018 Memo reversed a previous interpretation of the original Wire Act issued in 2011 (the “2011 Memo”).

The 49-page ruling confirmed the district court’s ruling that the Wire Act only applies to a “sporting event or contest.” In light of today’s other activities, which largely surrounded the onboarding of a new administration that will push to reinstitute many Obama Era policies, this further accentuates the problems with the 2018 Memo and the stance issued by the Department of Justice in 2018.

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Research Brief: State Legislative Outlook 2021

As 2020 comes to a close and 2021 begins, there is hope for new beginnings. While this happens among many as new year’s resolutions and new starts happen in any year, this is the case now more than ever as the world continues to grapple with the Great Shutdown and SARS-CoV-2. A little over a year ago, the world began the journey that none have experienced in over 100 years since the last pandemic. No one could have predicted that the year would have gone the way that it did, with brick-and-mortar gaming being brought to a complete halt, in some cases more than once. The world also came to realize that online gaming and mobile sports betting can be a strong source of revenue to supplement, not supplant, existing gaming revenue. While the world hopes for a quick turn of the calendar as turning over a new leaf, it will take some time before the world returns to normal and excels beyond, having learned from the past year’s experiences.

One thing that can be noted at the close of 2020 is that revenues for sports betting and online gaming continue to grow. Numerous states have launched their product in the middle of the pandemic, including Colorado, the District of Columbia, Tennessee, and others. Others continued to modify their setup, with Illinois in flux as it hands down executive orders to allow in-person registration without enacting strong, permanent regulations. While many states are still trying to move forward as they launch their market, revenue will continue to increase, with many markets now reaching a stabilized year for growth with a favorable sports calendar that included almost every major sport this past fall. This includes modified schedules in football, baseball, basketball, hockey, golf, and others.

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Research Brief: State Legislative Update on U.S. Sports Betting & Online Gaming December 2020

Some may believe that the counting of votes is related to the continuation of the November Election. As the November Election continues to take up the airwaves, states are certifying their results, leading up to the Electoral College vote that occurred on December 14th. While court challenges remain, the counting of votes in sports betting showed a wide passage of legislation to legalize the activities. November proved that voters took a strong stance showing that sports betting is supported by a plurality in these jurisdictions.

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Revving the Engine: How Southeast Asia is using gaming as an economic generator

It seems like an eternity since we heard discussions about the robust nature of gaming in Southeast Asia. Recent discussions have surrounded the continued development of brick-and-mortar facilities in areas like Vietnam, Laos and others. Most of the concerns about gaming were related to the crackdown on online gaming that had been influenced by China and the geopolitical pressures they propagate to exercise their policy views on various parts of the world.

However, SARS-CoV-2 came and shuttered the gaming world as part of the Great Shutdown. Since then, many existing land-based gaming properties have struggled to reopen or, if open, are operating at less than full capacity.

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Research Brief: State Legislative Update on U.S. Sports Betting & Online Gaming November 2020

While the national scene continues to sort through its trials and tabulations at the presidential level, the 2020 Election saw a great deal of success for gaming at the ballot box. Gaming was featured on the ballot in six states, with five of those having direct implications to sports betting. As will be highlighted later on in this brief, this continues to show that taking measures to the ballot is a method that operators, legislators, and regulators should not shy away from. The key is having the proper education campaign on the positive impacts of sports betting, as well as being prepared to provide answers to the naysayers.

While this applied well to sports betting and to a lesser extent brick and mortar operations, the future for iGaming may not have the same success unless an effective education campaign is run. iGaming brings in a different element to the ballot and legislative conversation, and it is one that will be tested in the coming months as every state legislature meets in 2021. Passage of sports betting measures is often easier when voters can often turn on their television, radio, or social media apps and discuss the line, just as one would discuss how well or how poorly a quarterback is playing in any given football game. iGaming is a more challenging sell, as this is viewed more similarly to a traditional slot machine or a table game directly in the hands of consumers, and legislators need to know that the right measures would in place for financial and consumer protections.

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