By: Kevin R. Albaum, Esq.
Clark, Campbell, Lancaster & Munson, P.A.
On May 14, 2018, the United States Supreme Court (USSC) struck down the Professional and Amateur Sports Protection Act of 1992 (the “Act”) by ruling that the entire Act was unconstitutional. Since the Act was enacted in 1992, it implemented a federal ban on all sports betting throughout the United States (with only a few exemptions from the Act such as the gaming industry in Nevada). The USSC’s ruling was based on the belief that the Act violated the Tenth Amendment of the United States Constitution which states that “The Powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people”. USSC’s ruling is saying that Congress had unconstitutionally abused their power by passing the Act and that each state should be responsible for deciding for themselves how their state should regulate sports betting. It is likely that the same line of reasoning (violation of Tenth Amendment) will be argued by the pro-marijuana side if the USSC decides to review a case in the near future regarding the legality of the federal ban on Marijuana.
Now that the USSC has handed down a decision, each state is able to regulate their own sports betting laws. Some states are acting fast as Delaware implemented legal sports betting on June 5, 2018, and Delaware Governor, John Carney, placed the first bet ($10.00 on the Philadelphia Phillies to win that day’s game) and on June 7, 2018, New Jersey had a bill pass allowing for legal sports betting. Other states (Connecticut, Mississippi, and West Virginia) are all expected to legalize sports betting by this fall in time for football season. California, Illinois, Michigan and New York all currently have bills or constitutional amendments pending that may pass before the end of 2018 as well. The legalization of sports betting is supposed to help cut down on a black-market industry where it is believed that Americans illegally wager over $150 Billion per year either through local bookies and offshore sports books. New Jersey will tax all gambling at a 9.75% tax rate with hopes to stimulate their revenue and to revive the dying tourist industry in Atlantic City. As many as twenty (20) other states are either considering or expected to consider legalization of sports betting by 2019 with more states likely to follow (especially if they see their neighboring states generating substantial revenue due to legalizing sports betting).
In Florida, sports betting remains illegal and that seems unlikely to change in the near future. This is due to a proposed constitutional amendment and an existing agreement with the Seminole Indian Tribe that both currently stand in the way of clarity to the legalization of sports betting in Florida. Amendment 3 will be on all Florida ballots this November and if passed will require that all casino gambling decisions in Florida would require an amendment to Florida’s Constitution in order to become law in Florida. If Amendment 3 passes, Florida’s legislature would no longer have the authority to create legislation related to casino gambling. The presence of Amendment 3 and the fact that this year’s session has already concluded makes is very unlikely for sports betting to become legal in Florida this year. Native American tribe agreements with the state of Florida will not be impacted by Amendment 3 (nor will pari-mutuel wagering on horse racing and dog racing).
About one-half of the states in U.S. have gaming agreements known as “Compacts” with Native American tribes which gives tribes the ability to conduct legal gambling operations. Currently, the Seminole Indian Tribe has a Compact with Florida and they pays the state more than $300 million a year for exclusive right to many card games and slot machine operations in the state in all counties besides Miami Dade and Broward. A renegotiation between the Seminole Tribe and the State of Florida is likely also needed before legal sports betting makes its way to Florida.
Kevin Albaum is an attorney in the Elder Law Practice at Clark, Campbell, Lancaster & Munson, P.A. Questions can be submitted online to firstname.lastname@example.org.