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Is Sports a Safe Political Bet?

By Rick Horrow and Karla Swatek

October 25, 2012

As America prepares to head to the polls on November 6, it strikes us how closely partisan politics mimic our other most popular autumn pastime: rooting for your favorite sports team amidst the falling leaves and first frost.
Whether you’re Crimson Tide red or Duke blue, support the buttoned-down Boston Celtics or the free-wheeling San Francisco Giants, the behaviors of sports and politics are closely intertwined.
Often, their issues are as well.
What do sports have to do with the upcoming elections? Like virtually every business in America, the multi-billion dollar sports industry has played a part in supporting candidates and legislation, and has a stake in the outcome of races local to national.
In El Paso, Proposition 3 authorizes a 2% hotel tax to finance a $50 million baseball stadium. The San Diego Padres will move their AAA Tucson farm team to El Paso once funding is approved. El Paso will also vote on nearly $500 million in downtown improvement bonds via a "quality of life" ballot measure. (Full disclosure: Horrow Sports Ventures has been at the center of crafting and advancing these initiatives.)
One of the major stops on the global pro tennis tour, the Sony Ericsson Open, has been played at Miami’s Crandon Park Tennis Center since 1994. Voters in Miami-Dade County will say yea or nay to a referendum that authorizes facilities improvements and an extension of the tournament’s lease agreement. The measure needs a 2/3 vote to pass.
The NHL Phoenix Coyotes are trying to finalize a sale that would lift the club out of bankruptcy and keep it in Glendale, Arizona. Voters there could put a wrench in the works by approving a proposition that would "repeal" a sales tax increase funding an arena management fee to be paid to the new owners.
And since "all politics is local," even a national issue can hit voters where they live. Recently, the U.S. Conference of Mayors took a stand on the NHL lockout, calling on owners to save the hockey season because of collateral damage to local economies.
The year’s biggest sports and politics issue, however, isn’t even on the November ballot, as New Jersey and its colorful governor Chris Christie fight for the right to legalize betting on sports, a move that could bring billions of dollars into the New Jersey economy.
Earlier this year, Governor Christie signed into law a bill legalizing sports betting in New Jersey, planning to put it into effect this fall. The bill attempted to create a clear distinction between pro and amateur sports by exempting from betting all collegiate sporting events held in the state. Nonetheless, it has since been challenged in Federal Court.
The NCAA’s recent relocation of six sports championships slotted for New Jersey in 2013 places an additional level of urgency on the case. So, too, do legal briefs filed by the NFL, MLB, NBA, NHL, and the NCAA claiming the "contrary positions" of the new state law are hypocritical and undermine the arguments the state is using to try to dismiss the Federal lawsuit-namely, that regulated sports wagering will cause no harm. The New Jersey lawmakers have also made the point-as have others before them-that billions of dollars are gambled illegally on sports each year, and states should be able to cash in.
Right now, there is a geographical "wall" between pro sports and legalized betting. None of the four states that allow sports betting (Nevada, Oregon, Montana, and Delaware) have professional teams. What happens if and when that wall tumbles down?
And what might a ruling in New Jersey’s favor mean for college and professional sports, especially with the expansion of casino gambling into many states that house teams and host events? Commercial casinos now operate in 22 states. Additional measures on November ballots would authorize table games in Maryland, Oregon, and Rhode Island, and approve a new casino just outside Washington, D.C.
The Washington Redskins have endorsed this initiative. Are the leagues out of step with their constituents?
Millions of dollars are spent in America each year on fantasy sports and March Madness basketball brackets. The leagues, and the media companies they do business with, certainly benefit from this trend, and it’s pretty clear that legal sports books and casinos would siphon off some of this revenue stream, too.
But they would also help to reduce the large illegal market-often run by organized crime-that is now the only channel most Americans have to bet on sports.
And that would seem to be a safer bet for all.

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Beyond the Scoreboard
Rick Horrow, America’s leading expert in sport business, and coauthor Karla Swatek give fans an inside look at the multibillion-dollar world of professional sport.
Beyond the Scoreboard eBook
Rick Horrow, America’s leading expert in sport business, and coauthor Karla Swatek give fans an inside look at the multibillion-dollar world of professional sport.
Beyond the Scoreboard: Chapter 1. The Mega-Master Super Series XLXL eBook chapter

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