Don’t Get “Hooked” on Sports Betting

On May 14th, 2018, the national landscape of sports betting underwent a significant transformation as the Supreme Court struck down the Professional and Amateur Sports Protection Act (PASPA) in NCAA v. Murphy as unconstitutional, ruling it in violation of the Tenth Amendment’s anti-commandeering principle. No longer were states prohibited from passing new legislation allowing gambling on professional and amateur sports.

This decision was music to the ears of many Native American tribes, who have long held permissions to conduct gambling activities. Primarily governed by the Indian Gaming Regulatory Act (IGRA) of 1988, the legislation codified three classes of games with a different regulatory scheme for each. Class 1 gaming includes traditional Indian gaming and social gaming for minimal prizes. Class 2 gaming encompasses bingo, while Class 3 functions as a “catch-all” and covers various forms of gaming, including sports betting. Before a Tribe may lawfully conduct Class III gaming, it must be permitted in the state, a compact with the state must be negotiated and approved, and the Tribe must adopt a gaming ordinance approved by the local state’s Chairman of the Gaming Commission.

In Florida, for instance, the Seminole tribe, owners of the famous Hard Rock Hotel & Casino, inked a compact with the state in 2021 worth at least $2.5 billion, allowing the tribe to run statewide gaming, sports betting included, in return for the funds. The judicial branch has stood behind the state’s executive branch and supported the Seminoles in their gaming business and compacts, fending off legal battles aimed at removing the monopoly created by the compact.

As recently as November 2023, the Florida Supreme Court rejected a request by two pari-mutuel companies to halt online sports betting offered by the Seminole Tribe. The focus of the legal fight is at the part of the deal aimed at allowing gamblers to place mobile sports wagers anywhere in the state, with bets handled by computer servers on tribal property. The private companies contend that allowing people physically located outside of tribal property to place sports bets would violate the state’s 2018 constitutional amendment requiring voter approval of any expansion of gambling to be approved by Florida voters. The state, on the other hand, argues that the language of the amendment does not include sports betting under its definition of casino gambling.

Irrespective of legal disputes, after the approval of online sports betting, the market has thus exploded. A demographic particularly enthusiastic about joining the game is young American college students. According to an April 2023 survey of 3,527 Americans between ages 18 and 22, nearly 60% have bet on sports, while 6% reported losing more than $500 in a single day. This demographic engages in betting through various means, with 28% favoring the mobile app approach for their wagers.

Albeit the thrill of online sports betting runs rampant among college students, it is crucial to delve into the darker side of this burgeoning trend: sports betting addiction. While the excitement of placing bets on favorite teams or players can be enticing, it is essential to recognize the potential risks and consequences associated with compulsive gambling behaviors.

Although gambling addiction affects people of all backgrounds and ages, adolescents of college age are uniquely likely to engage in impulsive or risky behaviors due to developmental factors and the college lifestyle. Like other addictive behaviors, gambling can stimulate the reward centers of the brain, making it difficult to stop, even with accumulating losses.

Colleges are not oblivious to this knowledge, actively engaging in multi-million-dollar advertising deals, such as the seven-figure agreement reached in 2021 between Louisiana State University and Caesars Entertainment to advertise sports betting across the campus.

In response to concerns about partnerships between sportsbooks and universities, the American Gaming Association (AGA) took decisive action in March 2023 by implementing stringent code changes. AGA member sportsbooks are now explicitly barred from future collaborations with universities for sports gambling promotion, except for engagements with alumni networks or content on responsible gaming.

The revised code eliminates terms like “free” or “risk-free” in promotional bets and standardizes the “legal age of wagering” to 21 or over, despite state variations allowing those 18 or older to participate. Notably, these changes do not apply retroactively to existing partnerships, allowing them to continue as mutually agreed upon. However, they exclusively pertain to AGA member companies, leaving entities like Caesars Sportsbook unaffected (LSU ended its agreement with Caesars shortly after the AGA’s update to its responsible marketing code).

Moving beyond the realm of college students, the vulnerability to sports gambling addiction extends beyond campuses. Estimates put the problem-gambling rate among Native Americans at more than double the rate among all U.S. adults. Considering the history of tribal gaming (see IGRA), it’s no surprise Native Americans suffer at a statistically significant rate of gambling addiction.

Consequently, various tribes have enacted programs to assist problem-gambling and support responsible gaming. The Washington Indian Gaming Association, for example, contributes more than $3 million per year to promote education on responsible gambling, as well as the development, prevention, treatment, and well-being programs. These include implementing diverse treatment programs for tribal and non-tribal members, funding problem gambling initiatives, promoting prevention and education, training staff to recognize and address problem gambling, designing culturally appropriate treatment approaches, facilitating the Intertribal Providers Coalition for monthly meetings, and offering self-exclusion programs for guests with problem gambling behaviors.

As “Exhibit A” of tackling gambling addiction among college students, lawmakers and regulators alike can look at the initiative’s tribes have enacted. This is not to say betting on sports is wrong or “needs to be fixed.” Rather, for the sake of vulnerable populations, we must regulate this vice, just like any other in this beautiful country, to ensure the least amount of victimization as possible.

Ultimately, college students have every right to gamble on sports, just like any other American of majority in a state where it is legal. The profits extrapolated from these wagers go to important resource allocations, such as state taxes, and help fund pivotal tribal infrastructure, including community programs, charities, emergency services, and cultural preservation, among others.

The key is to work within this protected niche to provide a win-win for all parties involved, whether that be having fun, procuring funds for important means, or, simply, for the thrill of the game.

References:

https://time.com/6342504/gambling-addiction-sports-betting-college-students/

https://www.ncaa.org/news/2023/5/24/media-center-ncaa-releases-sports-wagering-survey-data.aspx

https://theconversation.com/colleges-face-gambling-addiction-among-students-as-sports-betting-spreads-204434

https://www.ncpgambling.org/responsible-gambling/safer-sports-betting/

https://www.stlpr.org/fixed-odds/for-native-americans-tribal-casinos-help-and-hurt

https://www.washingtonindiangaming.org/issues/supporting-responsible-gaming/

https://www.tampabay.com/news/florida-politics/2023/11/17/sports-betting-seminole-tribe-supreme-court-block-app-gambling/

https://www.usnews.com/education/best-colleges/articles/sports-betting-on-college-campuses-what-to-know

https://lailluminator.com/2023/06/02/lsu-to-fold-on-its-controversial-sports-betting-deal-with-caesars/

https://www.clickorlando.com/news/local/2023/12/04/2018-gaming-amendment-never-included-sports-betting-florida-attorneys-tell-supreme-court/

Aaron Polonsky is a 3L at the Boyd School of Law @ UNLV. He can be found at https://www.linkedin.com/in/aaron-polonsky/.