SAFE Bet Act: Federal Push to Regulate Betting Faces Opposition

Two U.S. lawmakers, Sen. Richard Blumenthal of Connecticut and Rep. Paul Tonko of New York, have introduced the SAFE (Supporting Affordability and Fairness with Every) Bet Act, aiming to impose federal regulations on the state-governed sports betting industry. The bill proposes banning sports betting nationwide, forcing the 38 states with legalized betting to reapply under more restrictive federal regulations.

The legislators cite rising concerns over problem gambling since the U.S. Supreme Court's 2018 decision to overturn the Professional and Amateur Sports Protection Act (PASPA), which had previously banned sports betting. They argue that current state regulations are insufficient and propose federal standards on advertising, affordability, and the use of artificial intelligence.

Key Challenges Facing the Bill

The SAFE Bet Act faces significant obstacles. First, passing any federal legislation is notoriously difficult. Second, it comes late in an election year, where passing controversial bills is even more unlikely. Third, the bill challenges the principle of states’ rights, which many legislators, especially in areas like gaming, strongly defend.

iDEA Growth founder Jeff Ifrah dismissed the proposal as unconstitutional, noting that even if it passed, it would likely be struck down by the courts. He views the bill as more of a political gesture than a viable policy change.

State regulators and legislators have expressed frustration with the proposal. David Rebuck, former Director of the New Jersey Division of Gaming Enforcement, called the bill a “knee-jerk reaction” by individuals upset with PASPA’s repeal. Rebuck noted that states have already invested considerable time and resources in creating frameworks to address gambling issues and work with federal authorities to combat illegal offshore gambling.

Rep. Dina Titus of Nevada criticized the act’s broad restrictions on advertising and betting methods as misguided. She argued that federal oversight would undermine the efforts of state regulators to adapt to the evolving gaming landscape. Many in the gaming industry believe that state-level regulation, which has allowed states to tailor frameworks to local needs, is preferable to a one-size-fits-all federal approach.

Though the SAFE Bet Act is unlikely to pass, its introduction could have a ripple effect at the state level. Federal hearings on the act could draw significant media attention, possibly pressuring state legislators and regulators to adopt similar restrictions. Provisions in the bill, such as restricting advertisements and deposits, may influence future state regulations, even if the federal law itself does not move forward.

Critics like Cory Fox, VP of Government Affairs at FanDuel, argue that such restrictions would drive bettors away from legal, regulated markets, making them more vulnerable to illegal operators. The bill’s advertising restrictions, in particular, could hinder consumer protections.

“Introducing heavy-handed federal prohibitions is a slap in the face to state legislatures and gaming regulators who have dedicated countless time and resources to developing thoughtful frameworks.”

Conclusion

The SAFE Bet Act, while unlikely to pass, highlights ongoing concerns about problem gambling and federal involvement in the state-regulated gaming industry. While the bill has sparked debate, most experts agree that states are better equipped to regulate sports betting effectively. However, the discussions it raises could shape future state legislation, particularly regarding online gambling and advertising practices.