Tired of standing on the sidelines of yet another lush Super Bowl weekend for Nevada’s sports books, New Jersey is appealing the legality of the Silver State’s monopoly on bookmaking in America to the U.S. Supreme Court.
After losses in U.S. District Court and the Court of Appeals the state had until 15 February to loft a Hail Mary pass in the direction of the high court in hopes of overturning a federal law known as the Professional and Amateur Sports Protection Act, which for the last 20 years has prohibited New Jersey and 45 other states from licensing any kind of gambling on sports.
It’s not known whether the court will agree to review the case. Its decision isn’t likely to come before May, according to reports.
New Jersey petitioned for a hearing before the seven justices on 12 February and is asking them to consider whether PASPA usurps state authority in violation of the 10th Amendment to the Constitution, and whether, by granting permission to only four states to conduct sports betting, it also violates the equal sovereignty of the states?
Ironically, it was New Jersey’s own Bill Bradley, a Princeton University basketball star who would play on NBA championship teams with the New York Knicks and go on to serve three terms in the U.S. Senate, who sponsored PASPA with the aim of protecting sports in America from betting-related corruption.
In New Jersey the ban had never been an issue until the recession hit at the end of the last decade and casino revenues in Atlantic City went spiraling downward—they’re still spiraling—as states across the populous Northeast began legalizing their own markets and siphoning off gamblers.
State Sen. Raymond Lesniak, a northern New Jersey Democrat and one of the Legislature’s most outspoken pro-gambling voices, went to the federal courts unsuccessfully in 2009 seeking to challenge the Act’s exemptions as discriminatory. But unable to show harm he was rebuffed. So New Jersey’s citizens were asked to amend the state constitution to allow sports betting, which they did in a referendum that passed in November 2011.
Vowing at the time that they’d be taking bets on the Boardwalk before the year was out, the governor said, “If someone wants to stop us, then let them try to stop us.”
They did. In August 2012, the great powers of the American sports world—the National Collegiate Athletic Association, the National Basketball Association, the National Football League, the National Hockey League and Major League Baseball—went to court, arguing “irreparable harm” if New Jersey was allowed to flout PASPA. The following February, U.S. District Judge Michael Shipp found for the NCAA and the leagues. He acknowledged the problematic nature of the exemptions the Act had carved out but concluded that it was a matter for Congress to address.
Bill Pascrell, a prominent pro-gambling lobbyist based in the state capital of Trenton, spoke last September at the Global Gaming Expo in Las Vegas to Team Christie’s confidence in a victory on appeal based on its belief that PASPA clearly undermined states’ rights under the 10th Amendment, and that in the face of such an overarching issue the NCAA and the leagues had had no legal standing to challenge the New Jersey law in the first place.
“I’m very excited about what New Jersey represents in this space,” Pascrell said. “With the issue of sports betting, it’s not a question of if, but when.”
But it was very much a question of “if,” as it turned out, for not a week later, a three-judge panel of the Circuit Court, sitting in Philadelphia, voted 2-1 to reject the appeal, and a dejected Lesniak said, “This is the first time that I’ve started to lose my certainty about whether we’re going to win or not.”
In November, the 10 judges of the 3rd U.S. Circuit voted unanimously to refuse New Jersey’s petition for a rehearing, setting the stage for the possibility of some first-rate national theater in the Supreme Court on an issue certain to stir passions on all sides. The U.S. Justice Department has joined on the side of the NCAA and leagues. Missouri and Rhode Island have joined New Jersey in calling for PASPA’s repeal, and West Virginia, Georgia, Kansas and Virginia filed briefs in support of the state’s case before the Circuit Court.
In a particularly bitter twist, Super Bowl XLVIII was played on 2 February in New Jersey, where Atlantic City’s combined gaming revenues have plunged over the last several years to levels not seen since the 1980s.
For Nevada’s casinos, it was their richest Super Bowl ever.
Considering the sizable chunk the game contributes to their total annual win it also has set the books on the path to what likely will be another year of robust growth, Last year’s statewide gross of $202.8 million across 186 books was more than 19 percent better than 2012’s. On a percentage basis, even baccarat, the one consistent growth story Las Vegas’ casinos have had to tell since the recession, didn’t perform that well.
February may not be Las Vegas’ best month for visitation or hotel occupancy or conventions, but for gambling revenues it stands apart. Last year’s confluence of the Super Bowl and Chinese New Year saw the city and its surrounding communities—home to 90 percent of Nevada’s sports books and 80 percent of its sports betting revenues—enjoy their highest-grossing month of the year at $956.5 million. The Strip, which offers 37 books comprising 44 percent of statewide betting revenues, booked $696.1 million.
The rest of the town makes out handily too. The Las Vegas Convention and Visitors Authority estimates Super Bowl weekend draws more than 300,000 visitors and produces well more than $100 million in non-gaming economic impact.
“Las Vegas is jammed for Super Bowl week and for the NCAA’s Final Four weekend,” Lesniak has complained, “while Atlanta City is a ghost town.”