Just when it seems he has seen it all, Jimmy Vaccaro sees something new. His 40 years as a Las Vegas bookmaker have been a wild ride.
Even so, Vaccaro is eagerly awaiting the next twists and turns on the rollercoaster, starting with what appears to be the inevitable fall of the federal ban on sports betting. On Monday, the U.S. Supreme Court will hear a case that could dramatically change the future of the business and expand it exponentially beyond Nevada state lines.
“You can’t even imagine what it’s going to be like,” Vaccaro said from his office in the South Point sports book. “I would like to see it.”
The sports betting business in Nevada, which drew a handle of $2.4 billion in 2006, never has been stronger than it is now. The state’s handle topped $3 billion for the first time in 2012, escalated to $4.2 billion in 2015 and is approaching $5 billion in 2017.
According to the American Gaming Association, more than $150 billion a year is wagered illegally on sports in the United States, creating a thriving black market that pushes revenues underground and overseas. New Jersey and other cash-strapped states want in on the action.
Several politicians who were anti-sports gambling are shifting their stances. And while a majority of commissioners from major professional sports leagues continue to speak out about the benefits of a legalized sports betting market, the result could be a revolutionized industry.
Amid the excitement, this all raises another question: Will the rise of sports betting and the fall of Nevada’s monopoly on the legal side of it hurt business in Las Vegas?
As with everything else in life, there are pros and cons. Many football fans who now flock to Las Vegas to gamble on Super Bowl weekend might stay home in the future, and the same goes for college basketball fans in March. The surging handle in Nevada might suffer a setback.
Vaccaro said he sees that argument, but he’s raising the stakes.
“There are some people who say it’s a negative effect,” Vaccaro said. “I have a different take on it. I think it just creates more customers. I don’t think it hurts. We’ve seen these numbers grow for years and years.
“I remember in 1978 when Atlantic City opened up their casinos, that was going to be the doomsday of Las Vegas. Well, it was just the opposite.”
The high-profile case pitting New Jersey Gov. Chris Christie against the NCAA and the four major pro leagues is focused on the Professional and Amateur Sports Protection Act (PASPA), which in 1992 placed a federal ban on sports betting.
Numerous respected legal experts are predicting the Supreme Court could take down PASPA and free states to decide whether to offer legal sports wagering.
NBA commissioner Adam Silver has become an outspoken proponent of legal betting, but his league still joins the plaintiffs in the case against New Jersey because Silver prefers a federal regulation of the industry instead of individual state regulation.
The NFL has strongly opposed sports betting, but commissioner Roger Goodell recently changed his tune on the subject by saying Nevada regulations do help protect the integrity of the games. A high hurdle was cleared with the unlikely alliance of Nevada and the NFL, which this year voted to approve the Oakland Raiders’ relocation to Las Vegas.
MLB commissioner Rob Manfred has spoken in support of legalized sports betting and Las Vegas, and the NHL opted against requesting a betting ban on games involving the Vegas Golden Knights expansion franchise.
“The answer to the question of whether it will be good for Vegas is difficult without understanding how legal sports betting will be implemented,” said Robert Walker, an executive with US Fantasy Sports and the former MGM Resorts sports book director.
“The obvious answer is Nevada enjoys a legal monopoly on sports wagering right now, so legalizing it would have to hurt Vegas to some extent. However, if left up to the individual states, and if the Wire Act is not updated, I believe it will have a very small impact on both Vegas and the illegal bookmakers. I think we have some history for this with the land-based casinos proliferating throughout the country. So, the long answer is it is just too early to tell.”
The Wire Act of 1961 was intended to assist states in enforcing their respective laws on gambling and bookmaking and to suppress organized gambling activities. That act would need to be amended if Nevada were to play a role in bookmaking operations in other states. Nevada companies such as MGM Resorts and William Hill could experience potential gains by expanding operations, but how the industry would be regulated on a national level remains a murky and tangled issue.
“In order for Nevada to benefit meaningfully from legalized sports betting in other states, the current Wire Act would have to be amended or be clarified. This would help clearly define Nevada bookmakers’ ability to manage their own as well as third-party sports betting transactions from a Las Vegas hub,” said Michael “Roxy” Roxborough, the former founder and owner of the Las Vegas Sports Consultants oddsmaking firm.
“But it is still unclear to me that Las Vegas will be that hub. We are three hours behind the East Coast, and it is hard to believe that bookmakers will wait until Las Vegas wakes up to post daily odds. There may be a benefit to Nevada companies but not to Nevada. Some Nevada companies may do well with sports betting in other states, but it will most likely mean a lower handle in Nevada and less employment.
“If we look back to the first expansion of Tribal gaming, many Indian casinos sought out their own or independent management companies staffed by employees with Nevada experience. This might also be the case with the future of U.S. legal sports wagering expansion. In any event, the winners will be talented employees currently working in the industry with the flexibility to move. A key point often never mentioned is that sports gambling is small revenue in the world of casino gambling. A niche business at best.”
The transparent motivation for legalizing sports gambling — for states, politicians and professional leagues — is money. States are desperate for tax revenue. The pro leagues want a piece of the gambling pie, in addition to the fact that when more people bet the games, more people watch the games.
The Supreme Court’s decision, expected to be announced in May or June, could clear the path for sports betting in states outside of Nevada by the fall of 2018. How it would help or hurt the industry in the desert is up for debate, but Vaccaro is making Vegas the favorite.