Why No Federal Oversight of Sports Betting?

Unlike many other industries with a significant national presence, sports betting has lacked unified federal oversight since the U.S. Supreme Court’s repeal of the Professional and Amateur Sports Protection Act (PASPA) in May 2018. The ruling granted states the autonomy to decide their own sports betting laws. Now, six years into a world with widespread state-led regulated sports betting, the decentralized approach has led to a struggle in navigating the complex terrain of increased cases of gambling addiction and the pervasiveness of illegal offshore sportsbooks.

While federal autonomy over sports betting has been deemed unconstitutional, states’ autonomy raises questions about the consistency of regulations, the effectiveness of Problem Gambling efforts and the potential for federal involvement.

This article explores the history of sports betting legalization, the reasons behind the absence of federal oversight, efforts to introduce a connection between federal and state regulations, the challenges of measuring gambling addiction and the resources available for those seeking help.

History of Sports Betting legalization: States vs. Federal governments

The landscape of sports betting in the United States has undergone significant changes over the years, shaped by a tug-of-war between state and federal powers. PASPA, signed into law by President George H. Bush in 1992, marked a critical point in this history, banning states from regulating and taxing sports betting, thus effectively banning sports betting nationwide, with a few exceptions like Nevada. PASPA was intended to preserve the integrity of sports by preventing the spread of gambling. However, the law faced criticism for infringing on states' rights and failing to curb illegal sports betting. In fact, the American Gaming Association (AGA) estimated at the time that $150 billion a year was gambled on sports, 97% of which was bet illegally.

The turning point came in 2018 when the U.S. Supreme Court struck down PASPA, deeming it unconstitutional. The decision was a landmark moment, not just because it overturned a federal ban but because it reinforced the principle of states' rights. The Court argued that PASPA violated the Tenth Amendment by commandeering states to enforce federal law. This ruling opened the door for individual states to legalize and regulate sports betting as they saw fit.

By allowing states to determine their own sports betting laws, the Court acknowledged the diverse perspectives and needs of different regions. Some states, like Nevada, had long histories of regulated gambling, while others preferred to maintain prohibitions.

Efforts to increase federal oversight, research & resources

Despite the shift towards state regulation, there have been ongoing efforts to introduce federal oversight in the realm of sports betting. One notable initiative is the first-ever federal funding stream with the Gambling Addiction and Responsible Gaming Integrity Transparency (GRIT) Act. This proposed legislation aims to enhance federal involvement in gambling regulation, focusing on responsible gaming practices and transparency.

With illegal, offshore sportsbooks continuing to operate illegally and allow access to U.S. citizens, plus an NCPG-reported 30% increase in the risk of Gambling Addiction rates from 2018-2021, the GRIT Act seeks to establish a federal framework for addressing gambling addiction, including funding for research and resources to support affected individuals.

First introduced on January 12, 2024, the GRIT Act is still in the legislative process, reflecting the complex and often contentious nature of federal gambling oversight. Here is some more background information about the GRIT Act.

Rates of Gambling Addiction in the U.S.

One of the challenges in assessing the impact of sports betting in the U.S. is the difficulty in measuring rates of Gambling Addiction. Nationwide research on this issue is limited, with data often dependent on individual states and various research institutions and universities. This fragmented approach has made it challenging to develop a comprehensive understanding of gambling addiction trends across the country.

From what we can glean, according to data compiled by Birches Health, Gambling Disorder rates vary significantly by demographic factors such as age, gender and socioeconomic status. Sports bettors tend to be young, male and wealthy. Nearly half of Americans have gambled in the last year, and 1-2% of the population has a Gambling Problem, with another 3-5% showing some signs of a problem.

Resources for problem gambling & addiction treatment

Addressing Problem Gambling and addiction requires a multifaceted approach, with resources available at both the state and federal levels. Birches Health is at the forefront of providing comprehensive virtual support for individuals struggling with Gambling Addiction.

There are multiple options for taking the first step with Birches Health:

Book an Appointment with a Therapist
- Professional therapy can provide individuals with the tools and support needed to address gambling issues.
Speak with a Care Specialist
- BH care specialists are trained to properly guide individuals through the process of seeking help.
Refer Someone Else
- Concerned friends or family members can refer someone they know who may be struggling with gambling addiction.
Free Self-Assessment
- A self-assessment can help individuals understand their gambling behaviors and determine if they need professional help.