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Although support for a bill to create a federal oversight structure for state-authorized sports betting may garner some support among members of Congress, Nevada Representative Dina Titus does not see it as an immediate threat to the industry.
Representative Paul Tonko, a Democrat from New York, last week introduced HR 9590, or the Supporting Affordability and Fairness with Every (SAFE) Bet Act, aimed at reducing gambling addiction and establishing minimum federal standards for sports-betting advertising and the use of artificial intelligence (AI), among other topics.
Titus, a Democrat whose southern Nevada district includes the Las Vegas Strip, described Tonko’s legislation as “a messaging bill”.
“I don’t see it passing, certainly not this session. Probably nothing is going to pass this session,” Titus said Thursday (September 19) at the Betting on the Future of U.S. Gaming seminar hosted by the American Gaming Association (AGA) and Semafor in Washington, D.C.
Democratic U.S. Senator Richard Blumenthal of Connecticut last week also introduced S. 5057, a companion bill in the Senate. Blumenthal’s bill has been referred to the Senate Committee on Judiciary.
“For many years gaming just kind of kept its head down and played defense,” said Titus of the industry's relationship with Congress. “We didn’t want the federal government looking at what were doing. Better to have state regulation.”
Titus expressed concern that if the federal government were to get involved in regulating any aspect of the gaming industry that could roll into another “layer of rules and possibly put in some taxes”.
“We want to avoid all of that,” Titus told attendees.
Currently, there are 38 states and the District of Columbia that have legalized sports betting, with either commercial or tribal gaming in every U.S. state except Hawaii and Utah.
U.S. commercial gaming revenue for the second quarter reached $17.63bn, up 8.9 percent from $16.07bn in the same period last year. Sports-betting gross gaming revenue (GGR) was $3.16bn, while traditional casino GGR was $12.49bn, and iGaming GGR was $1.97bn, according to the AGA.
The National Indian Gaming Commission (NIGC) reported revenue for the tribal gaming industry reached an all-time high of $41.9bn last year.
“We can no longer hide,” Titus said. “So, if you look at legislation that has been introduced [in Congress] right now, there are [several] bills that are on the agenda, and we are playing offense and defense.”
One of those bills that has been stuck in the House Committee on Energy and Commerce subcommittee on Health since early January is the Gambling Addiction, Recovery, Investment and Treatment (GRIT) Act. The bill would set aside 50 percent of the 0.25 percent federal excise tax on sports betting for gambling addiction treatment and research. Titus has sponsored a bill in the House to repeal the excise tax altogether, with a companion measure also filed in the Senate earlier this year.
Elsewhere, the Internal Revenue Service’s (IRS) Advisory Council in February announced support for raising the federal income tax reporting threshold for slot machine jackpots from the current $1,200 to $5,000. Titus has been asking the IRS to raise the tax reporting threshold since 2015.
The $1,200 slot tax threshold was established in 1977, when Nevada was the only state with legalized gambling. There are now 44 states with either commercial or tribal casinos, but the IRS has yet to increase the threshold.
“You think the federal government is not involved; think about the IRS, the U.S. Department of the Treasury, and the Bureau of Indian Affairs. There is lots of different layers,” Titus said of the gaming industry and the different branches of the federal government involved in oversight of taxes, anti-money laundering programs and tribal gaming.
Tonko initially received the attention of the gaming industry when he introduced an earlier bill in February 2023 that would have banned all online and electronic advertising of sports betting.
The newly proposed SAFE Bet Act also includes restrictions on advertising, requiring state regulations to ensure that all sports-betting advertising is prohibited between the hours of 8am and 10pm, as well as during live sporting events. Tonko and Blumenthal also included affordability provisions, as well as prohibiting the use of AI to track a player’s gambling habits, create customized promotions, or suggest specific wagers.
The bill also proposes an annual nationwide survey of online sports betting to provide “quantitative data regarding the scope of problem gambling and gambling-related harm experience by individuals using online sports betting”.
Titus questioned the requirement of an annual study and affordability checks.
“It calls for a study, and you know when they call for a study that’s always dangerous because you don’t know where that is going to go,” Titus said. “But also, restrictions on when you can gamble, how much you can gamble, when you have to stop gambling. I don’t think that’s the way to approach it.”
As for Tonko supporting a ban on sports-betting advertisements, Titus suggested that was because he and others believe these ads entice people to gamble.
“I look at it as a glass half full, half empty,” she said. “Advertising is a good thing in the way that it lets people know what are the legal, legitimate sports-betting sites because a lot of people may not know that they are betting on some illegal site. Just go on the internet and a thousand pop up.”
“So, when we look at regulation, let's keep that in mind,” Titus added.
Titus disclosed that she has already expressed her concerns about the SAFE Bet Act directly to Tonko.
“He feels very strongly about this,” Titus said. “I just think he is misdirected because he really doesn’t have a sense about how the system really works. This is another good example of how there is still a stigma against gaming, even though it has spread so far and is so legitimate now.”
