NBA is the only league being honest about its ‘concerns’ with legalized gambling
The NBA might “relent” and drop its legal battle against the regulation of gambling on its games in exchange for a cut of the action. That’s exactly what all the other leagues want too, but they are still maintaining a facade of having other concerns.
The NBA seems to be not only the only major professional sports league in the United States to be proactive on the issue of legalized sports gambling, but honest as well.
United States citizens are currently awaiting a Supreme Court ruling on Christie v. NCAA or the fate of legislation proposed by New Jersey representative Frank Pallone (D-6th), either of which could result in the repeal of the federal legislation which makes betting money on sporting events illegal in most of the country. Some state legislatures are anticipating such a development and working to get laws on the books that will regulate and tax the activity once it becomes legal. New York is one such state, and the conversation in that state’s legislature has revealed the NBA’s priorities.
According to ESPN’s Brian Windhorst, the NBA has submitted to the New York legislature a framework that it would accept for legalized gambling on its games. In summation, the NBA wants to be a partner.
The NBA’s suggestion contained no tenants about making sure that the legislation contains resources for treatment for problem gamblers. It makes no mention of establishing a framework to ensure that the integrity of its games aren’t compromised. The NBA simply wants one percent of the handle in New York (see here for the difference between handle and revenue) in the state, and wants access to wagering to be as expansive as possible. Previous similar pieces of legislation in states like New Jersey and Pennsylvania have limited betting sites to established casinos and race tracks.
While the New York legislature has no obligation to acquiesce to the NBA’s request, the NBA does hold some leverage. If the NBA’s demands aren’t met, it could challenge any legislation in court. The NBA is part of the reason why New Jersey’s sports betting law has been held up in litigation for years. A similar challenge could put New York’s law in the same boat.
Whether legislators in New York will agree to the NBA’s demands remains to be seen, but what’s clear is that the NBA is taking a different approach to the issue of legalized gambling. The NFL, for example, has most recently gone on record via Commissioner Roger Goodell with other concerns.
"“I think we still strongly oppose legalized sports gambling,” Goodell told reporters at a news conference after owners meetings in Phoenix. “The integrity of our game is number one. We will not compromise on that."
While those may be Goodell’s words, the actions of the NFL cast a different light. The NFL has yet to formally request that the Nevada Gaming Commission remove its games played in the state from the rolls. The league has plenty of time to do so yet, as the soon-to-be Las Vegas Raiders won’t begin play in the state until the 2020 season at the earliest, but Goodell has also stated that it’s not currently the league’s position to undertake such an action. If the integrity of the game is number one, the NFL should be taking every action possible to limit wagering on its games. So far that isn’t the case, which suggests that the NFL has other priorities.
Perhaps the greatest indication that all that leagues like the NBA are looking for in return for dropping their “opposition” to legalized gambling is a cut of the money becomes obvious when the effects of paying one percent of handle to leagues like the NBA are considered. To project that, numbers from gambling in Nevada can be considered. The Nevada Gaming Control Board estimated the handle for 2017 to be just under $5 billion. Under the NBA’s proposal, it would get at least a part of $50 million.
That would be a great windfall for the NBA, but would present significant problems elsewhere. Such a cut off the top would drastically reduce profits for sports books, who will already have to pay taxes out of their revenue. The gross revenue for most books is about four to six percent, so paying one percent to leagues like the NBA would reduce profit automatically by as much as 25 percent.
That could prompt more people interested in betting on sports to operate outside of the legal channels, thus nullifying one of the very reasons for the legalization of sports betting. The idea is to bring sports gambling out of the shadows and transform it into a well-regulated industry.
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Stated concerns like integrity and protection of individuals are great for public relations for leagues like the NFL. Whether for better or for worse, the NBA has abandoned that angle and boldly stated that it’s only interested in the money. That stance is worthy of some criticism, but at least the NBA is being honest about it.