The third anniversary of the U.S. Supreme Court decision overturning the Professional and Amateur Sports Protection Act (PASPA) was celebrated in May. The American Gaming Association then took the lead in a campaign to legalize sports betting in jurisdictions across the U.S. Sara Slane took the lead in that effort, and was hugely successful. Today, 30 states and territories have active or legal sports betting. Slane now heads up her own consulting company advising jurisdictions and companies about how to enter the U.S. sports betting market. She spoke with GGB Publisher Roger Gros about the rapid deployment from her home office in Maryland in April.
GGB: It seems like an eternity, but it has only been three years since the reversal of PASPA. How surprised are you that so many states have legalized sports betting in that time?
Sara Slane: I’m shocked that so many states have legalized sports betting in such a short time. At the end of the day, we thought that we’d have around 43 states that would legalize sports betting, but we didn’t expect it to go so quickly.
One of the major states, New York, just legalized mobile sports betting. What’s your assessment of that law?
I’m pretty passionate about this piece of legislation because I think it’s terrible for the industry. On one hand, I’m glad New York finally got the full legalized sports betting. On the other hand, it’s a “be careful what you wish for” situation. This has set up a race to the bottom on tax rates. It wasn’t a thoughtful process. It doesn’t look at the holistic picture for the industry. If New York had done some interesting things it would have moved their entire gaming industry forward and would have been a much larger economic driver for the state.
We’ve seen some hiccups with the state lotteries running sports betting, certainly in Washington, D.C. and in Tennessee. Is it a bad idea to have the lottery in charge?
I wouldn’t want to paint a broad brush stroke against the lottery. I don’t think that’s the issue. Let’s not forget sports betting is a new industry and states aren’t used to it. Adopting best practices and looking at what other states have done is the best way to go. You don’t have to recreate the wheel. There are some very good examples of how states have handled this, so you just need to rinse and repeat. I’m not sure why Tennessee has stumbled out of the gates, but I don’t think you can blame it on the lottery or any individual.
Is it because the lotteries are used to huge profits? Several lotteries have required that they make a 10 percent profit, when in the real world a 5 percent profit is a banner year.
I think when you set a monetary goal of the most amount of money possible in very black-and-white terms, it’s going to lead to very bad policies.
When will states realize that the taxes they can make from online gaming will dwarf sports betting taxes?
I wish I had the special sauce to answer that question. I’ve spent 10 years explaining the numbers and it’s tough. There is still belief, although there is no proof, that cannibalization is going to occur. There’s still the perception that having a mobile casino will mean people will be less interested in going into the bricks-and-mortar operation. It’s a tough sell. The ease of access is also a hurdle to overcome. The flip side is that it’s happening around the world, and we’re making progress with online sports betting. And done the right way, it really completes the package on an omnichannel delivery system.