Supreme Court Decision on PASPA Could Lead to Mississippi Sports Betting by June

Following the United States Supreme Court’s ruling declaring the Professional and Amateur Sports Protection Act unconstitutional, the Mississippi Gaming Commission’s Executive Director has stated a goal of having legal sports betting in Mississippi casinos by the end of June.

Draft regulations have circulated for weeks, and it is only a matter of time before final regulations are published, approved and implemented. If the MGC goal is correct, draft regulations could be published for public comment this Thursday and final regulations promulgated in June.

What does this mean for licensed casinos? Mississippi casinos affiliated with Las Vegas casinos that have sports books could find themselves with a short term advantage over those casinos in Mississippi without such affiliations. The latter group will have to wait a while longer for sports betting suppliers to be licensed and approved for gaming in Mississippi while the former may transfer their experienced race and sports book employees to their sister Mississippi properties right away.

But even those licensees with sports books affiliates in Las Vegas will require some lead time to amend internal controls and obtain work permits for race and sports book employees, among other regulatory approvals that will appear in the final regulations.

Regardless of the time by which most casinos in the Magnolia State will have legal sports betting on their properties, Mississippi most likely will gain a significant head start on its surrounding states. This may yield an increase in tourism to the state and a resulting increase in gaming and other revenues.

How Important Would Sports Betting Be to the State of Mississippi?

Enacted in 1992, the Professional and Amateur Sports Protection Act (“PASPA”) effectively prohibits sports betting in the U.S. at both a federal and state level other than for a few exceptions that benefit four states (Nevada, Oregon, Delaware, and Montana). In recent years, some state governments and professional sports leagues have completely altered or at least moderated their stances against legal sports betting in the United States, most notably in response to the proliferation of Daily Fantasy Sports. In light of what has happened in regulated markets in the U.S. and overseas, additional states have pushed for revisiting regulated sports gambling.

Interest in sports betting increased even more with the news that the Supreme Court of the United States (“SCOTUS”) agreed to hear New Jersey’s appeal from the Third Circuit decision upholding PASPA in Christie v. National Collegiate Athletic Association. Depending on how the Supreme Court rules in Christie, it may be possible for states to legalize and regulate sports betting. Many states are anticipating a friendly ruling from the Supreme Court and taking steps now to ease their entry into the sports betting space when able.

Mississippi is one of only a handful of states that have already taken necessary action. In the 2017 session of the Mississippi Legislature, a Daily Fantasy Sports bill made minor changes to the Mississippi Gaming Control Act, and notably removed language that provided that no wagering could take place on an athletic event that did not take place on licensed casino premises. The amended law simply left in place the requirement that the wager be made on the casino premises.

With this change in the law, Mississippi is arguably ready to be one of the first states to implement sports wagering in the event of a favorable ruling by the Supreme Court with respect to PASPA. Of course, regulations would have to be put in place by the Mississippi Gaming Commission in order to protect the integrity of the betting procedures, provide for internal controls and other necessary items.

Many argue that sports betting alone will not provide much, if any, additional gaming revenue to the Mississippi casino industry or additional gaming tax dollars to the Mississippi treasury. But, other industry professionals dispute that. When one Tunica County casino operator recently was asked what sports betting could mean for Tunica, he replied “it would save us”.

While it is true that sports betting itself may not produce a significant amount of additional gross gaming revenue, additional traffic to Mississippi casinos could mean millions of dollars to the state gaming industry in food and hotel room sales and additional gaming revenue due to visitation from surrounding jurisdictions.

Why would additional patrons come from adjoining jurisdictions? Because sports betting is not yet legal in those jurisdictions and may not be for some period of time, if ever. Thus, Mississippi might get the “jump” on its surrounding states and reap the benefits.

Below is a summary of the current status of sports betting in neighboring jurisdictions. Continue Reading