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Cheryl Atkison
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Hi everybody, Cheryl Atkison here. I hope you enjoy this special from the Archives edition A Full Measure After Hours. Hi everybody, Cheryl Ekison here. Welcome to another edition of Full Measure After Hours. Today, a look at legalized sports betting, possibly already in your state or coming soon. This coming Sunday. That's November 21st. I take on the topic of legal sports betting. Much like legalized marijuana, which we've also looked at, there is a major concerted lobbying effort going on, state to state, to try to make this formerly illegal thing or activity legal, and the effort is quite successful. As always, there are differences of opinions on the benefits and harms. A lot to consider. I'll be reporting from one of the country's most robust and fairly new sports betting markets, the state of Colorado. Sports betting became legal in Colorado on May 1, 2020. As it happens, just about the time the COVID shutdowns arrived, which was not great news for that industry, the casinos shut their doors. The casinos are where the sports betting has to take place under the law in Colorado and most sports stopped. Well, I said it has to take place in the casinos, unless you're doing mobile sports betting on mobile apps, and there are a lot of those making it easy for almost anybody in Colorado to place bets using their phones. Interestingly, I asked some of the experts who I interviewed, how do you know someone's really in Colorado when they're making their bets on the phone? Because they may be in another state where it's not legal and they have a geofencing way to figure out if people really are in the state boundaries. One of the regulators told me they can even tell if someone's flying in a plane over Colorado trying to place a bet. They're not allowed to do that, but they said they can tell. In any event, with the casinos closed and a lot of sports shut down too, what was there to bet on for these people who got so excited because now sports betting had become legal? Well, there was tons of betting on ping pong, table tennis, I guess they call it officially, particularly Russian ping pong, which was going strong. So there may not have been as much football, baseball and basketball going on, but there was a lot of ping pong and it generated about 63 1/2 million dollars in sports bets in Colorado during 2020. Once sports betting became legal in May, what are the benefits? What do they do with the money? Well, there's a 10% tax on sports gambling revenue, and in Colorado, it largely goes to benefit Colorado's water department. You'll hear in an interview in a minute why that is, why that was sort of the chosen beneficiary in Colorado. But this is all happening in many states ever since the Supreme Court basically threw out a federal ban on sports betting that was in 2017. So now a couple dozen states have some form of legal sports betting and it's approved and coming soon and more. A concern that was raised while we were covering the story is how many gamblers find this irresistibly addictive to their own detriment. And so they have put some tools into place to try to help better set their own limits. But of course, if you're a gambling addict, you probably can't set your own limits. So you'll also hear from the first certified gambling counselor in Colorado who has a private practice, but she works at prisons and a psychiatric hospital and she treats these gambling addicts, which she said, boy, they started coming to her pretty quickly after gambling was legalized, particularly during COVID where she said people didn't have much to do and they were staying home and discovered these mobile apps that they could learn about gambling and take part in sports gambling even when everything else was shut down. So the first person you're going to hear from today is a man named Dan Hartman, who I spoke to. He is the director of the Colorado Division of Gaming.
Dan Hartman
I've been with the Department of revenue for 29 years in the racing division. So regulator over horse and dog racing. And that was up until recently, two years ago, came to the Division of Gaming. But I also in 2010, brought up medical marijuana, the licensed medical marijuana program here in Colorado, and did a short stint as a liquor director. So had quite a few of those kind of businesses here.
Interviewer
What's the idea philosophically behind you being involved in bringing those ventures to Colorado?
Dan Hartman
You know, I think that, I think, you know, we, as the Department of Revenue, in our specialized business group, we, we get those kind of programs to come up just because they collect a lot of revenue. There's a, there's a certain amount of regulation that goes along with them, new rules, those kind of things. So having done that, worked with stakeholders, done all those things, like you Know, it became. They've chosen me and brought me into these kind of things.
Interviewer
Okay. When it comes to sports betting, can you give me the abridged version of how this got started? What is the history here in Colorado and what's going on?
Dan Hartman
Sure. So when the. The United States Supreme Court overturned PASPA and it allowed states to make up their own decisions about sports betting, what.
Interviewer
Year was that, do you remember, offhand?
Dan Hartman
2017, I believe. And so they did that. We actually took an active role in the Department of Revenue and started putting together some information about what it might look like if it came to Colorado. So the legislators, legislators started looking at it. Who would regulate it? Would it be its own section? Would it come to Division of Gaming, Division of Racing, or the lottery? I mean, it's been put in all kinds of different places around the state, around the country, in different departments. So we put that together and we had that ready to go. So we were starting early to at least look at it. So we were educated when we were asked to look at legislation to do.
Interviewer
Those kinds of things was the big pitch, in essence, tax revenue.
Dan Hartman
So I think tax revenue is one of those things, and it's also taking off of taking the black market, black market, bookies, offshore betting, and bringing it into a regulated market where the consumer is safe. They have a regulated market, and they have somebody overlooking and overseeing the operators that are doing it.
Interviewer
Can you explain how big the offshore black market for betting was for people maybe here in America that were finding a way to gamble anyway on sports?
Dan Hartman
It's been. It's been. It's been really estimated at well into the hundreds of billions of dollars here in. Here in Colorado, maybe two and a half billion dollars, maybe more. There's no. There's no really way to track it, but that's. Those. Those were the numbers, and they. And they seem to be panning out. If we've moved. If we've done our job well and moved people into the. Into the. Into the legal market, away from those, Away from the illegal market. We're now up into those numbers, into the 250.
Interviewer
So when did it become legal here and how was this all implemented?
Dan Hartman
Sure. The legislature in 2020 started their. Or, sorry, 2019, passed legislation that would allow sports betting to take place in Colorado when anything. When any new tax is brought up. So taxation on sports betting would be a new tax that has to go in front of the vote of the people. So statewide vote of the people. And so when they put the enabling legislation in, it came before the vote. So as long as the vote passed in November, they were able to then they were able then go ahead in 2020 have that vote and then we'd be able to or 2019, have that vote in November. And then we were able to. We were able to start the program six months later in May. But the vote went in front of the people for the tax, that 10% tax here in Colorado, and it narrowly passed, but it passed.
Interviewer
And so was it worded in such a way in the referendum when people voted, it was only to be allowed places where there were already established casinos. The three places in Colorado.
Dan Hartman
It did have all of the. It did have all, all of the places that it would be. How the legislation was put in, it didn't get into the real nitty gritty, but it was going to be connected to the gaming industry.
Interviewer
And what have you noticed so far?
Dan Hartman
We've noticed that this form of entertainment in Colorado is being well received. We've got a lot of, you know, we have 33 casinos here in Colorado. Each one of those can have a master license to have a operator. And right now we're at about 17 operators and probably soon to be quite a few more. And up to that, maybe up to that 33 by, you know, within another year or so. But it's been. That gives a lot of, a lot of competition here in the state, a lot of different operators that are. That are doing it. But it really has been a, you know, far exceeded our expectations of numbers coming out. We thought it might start slow, come out and then get started. We opened in May of 2020, which the casinos were closed at that time due to the pandemic and no sports. But we opened with four operators and really pushed forward.
Interviewer
So you operated during the pandemic?
Dan Hartman
We did.
Interviewer
Were people coming in here to bet or they were betting.
Dan Hartman
It was all on a mobile app. So in Colorado, you can come into a retail book like we're sitting in, or you can sign up and you can bet online from your mobile app on your telephone.
Interviewer
Do you have any early numbers? Do you have any idea how much the casinos are making or the companies that do the sports betting and how much in tax revenue is coming in?
Chris Kramer
Sure.
Dan Hartman
So the first year, the first year, through the first year, we did about week hand or wagered. The state of Colorado wagered over to over $2.3 billion. So that was starting in May, coming around to May. I think that when we make our first distribution from the sports vetting fund, it may be upwards of 6 to 7 million dollars going towards the beneficiary of the water program here in the state of Colorado.
Interviewer
Six to seven million.
Dan Hartman
Six to seven million.
Cheryl Atkison
Okay.
Interviewer
Where does the rest of the money go? Is it earmarked?
Dan Hartman
Yeah, no, that's, that's where the, that's where the taxes go after, after expenses. Some of the other, some other little things that, you know, for responsible gaming and some other things that come out of that fund. But the majority that goes to the water fund here in Colorado.
Interviewer
So when you gave me the 2 billion dollar number, that's the net revenue that's coming in.
Dan Hartman
That's the total bet. So when you, when you, when you, when you have that total bet of 2.3 million, $2.3 billion, about 95% of that's returned, maybe 90, 94% is returned back to the betters. So then you have, you have some proceeds there that are the gross gambling revenue proceeds. Those are, then they have some deductions where they can take off some of their free bets, they can take off their excise tax paid to the federal government, and then we get to a net sports betting revenue where they're then taxed 10%.
Interviewer
Why did the water division get to be chosen as the beneficiary? Why was that necessary?
Dan Hartman
So out here in the west, and I think every, you know, every place that you put where sports betting goes in or any kind of gaming, all these programs, they usually find something that's important to the state. In Colorado, in western states, water is king. You know, it's getting those programs going to collect it, to divert it. Well, to really manage the water here in Colorado. So it's useful to the people in the state of Colorado. So we had a, we had a, in the former governor's tenure, we had a water plan set up that's a yearly plan for all kinds of different things. And to get that going. But this is, this money will go into a fund. Well, they'll be able to put out grants to smaller projects all over the state really, to manage water.
Interviewer
What trends have you noticed? During the pandemic, a lot of sports weren't being played. I suppose people can bet on sports outside of the United States too. What were some interesting trends?
Dan Hartman
I think that, I think the most, I mean, they were able to bet outside of this, outside of the country and in different places, as different places opened up or had their sports going on. One of the things that we saw here was that they really were successful in watching ping pong or table tennis. Table tennis has got a Lot of content, there's a lot of action going on really almost all around the clock. Short games every day, short games, they can play almost every point. Tennis was another one that they had some leagues that were put in foreign countries that as long as they have governing body, they have the officials, we know that they've got some integrity programs in place. We can approve those kinds of, those kind of sports.
Interviewer
So there was a lot of betting on Russian ping pong.
Dan Hartman
There was, there was and there continues to be. And I think people are really excited about, I mean they're, they've found that part of the entertainment to be, to be ongoing. And I think maybe it's, we had opened up with the big four or five sports, they wouldn't have seen how far reaching our sports catalog goes. We can bet on many, many leagues, many, many types of different sports. And I think having it started in that they found those things and they know they're there. Now.
Interviewer
If you're betting on a sports app, is it through a casino? In other words, do they have to get on an app and come to the casino or is it done differently like directly with DraftKings they can go.
Dan Hartman
Right to the operator themselves. So we, when we, when we were getting ready to launch, when we were looking at our rules and regulations, we went from the get go to say look, we're going to have retail, we're going to have mobile, that's what the law allowed. And we set both of them up at the same time. So we were. When the pandemic hit and they closed the casinos, they don't have to come here to set up their account. They can actually do it online. They can look at their odds online. As long as they're in the state of Colorado, geofenced to the state, inside the state of Colorado, they can then make a bet.
Interviewer
What is the downside or what are the negative repercussions from sports betting? If you don't see any, maybe you do, maybe you don't. But what are the arguments against it?
Dan Hartman
Well, I think the arguments are that, you know, that it's, it's, it's more gambling and may feed into those kinds of responsive gaming or problem gaming types of situations. We think that, we think that having a legal regulated market where we look after, you know, we look after the rules, the regs, how the money is there, we can look into complaints and all of those things, you don't have to go offshore to try to get your money back. If you know all of those kinds of things that's the positive, the negative, anything that has to do with more gaming, some people don't like. I think that you'll find that the operators, they run very responsible, responsible operations. We have it in our rules mostly, or all the operators have places where they can. You as a better when you go in and sign up, you set your own road, your own roadmap, you set roadblocks to say, look, I don't want to spend more than a hundred dollars a week. I don't want to, you know, I don't want to be able to, to deposit more than, more than this amount of money. Those kinds of things, you can push a button and pause for a while or you can even stop altogether. And in those cases, you know, if you're having a weekend and you start to find yourself being drawn in too much, you can hit pause and really stop for a while and the operator won't bring you back up until that time limit is running or until you, you know, until you've gone past it and want to come back.
Interviewer
Well, the only problem is if you're an addict, you're probably not necessarily going to take yourself off.
Dan Hartman
Well, and they may, and they may go, and they may go to other places, but I know that the sports books, the operators actively, they actively look at their patrons and where they're at. And if they, they seem to be moving in the wrong direction, they may have one of their people call or give them a message to talk about where they're going.
Interviewer
Do you know anything about what the national trends are in terms of states looking at the same thing or ones that have done so recently after the Supreme Court decision? Where are we? What can you tell people about the national landscape?
Dan Hartman
I think the national landscape, I think legislatures and governments are looking at it as another form of entertainment, another formal way to raise money. Certainly in anybody, any state's budget, it seems to be a good way to go and at least bring some money in. So I think we're up to 19 states now that have legalized it. There might have been a few more this spring during the legislative sessions. When I talk to other states and other people, there's a lot of other people looking at it, a lot of other states that are looking at it, whether it's right for them or whether it's not right for those states. It's really up to them and how they put the program in. Some may already have legalized gaming, some may just put it into a lottery. There's been a lot of different ways that the states and legislators have gotten creative and where they put the program itself.
Interviewer
If people don't know much about it and are wondering what's sort of your takeaway message for them, if they're saying, I don't know what this is all about and I don't know if it's coming to my town, but what would you say?
Dan Hartman
Well, I think, I think it's, you know, I think it's been, it's been, it's been good for Colorado. I think we, you know, we see, we see money that's going to go towards, towards the water program. A beneficiary, whatever that, whatever that beneficiary is for their state. I think that it's, I think that most people think that just sports betting is going on anyway, so it's going on illegally in states, going on offshore and doing those kinds of things wherever they can get from the Internet. And I think bringing it into a regulated market really gives people a little bit safer environment to do it in.
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Cheryl Atkison
We're back talking about legal sports betting, something that's becoming legal in more and more states. And now we're going to hear from Nancy Lance. She's an international certified gambling counselor and by the way, was the first gambling counselor in Colorado.
Nancy Lance
I think you said you were the first gambling counselor in Colorado.
Way back in the 90s, when casinos first hit, there was nobody else. I counseled domestic violence and addictions, and I ended up with people who started having a gambling problem. And so there was nobody in towns. So I started going to the national conferences to become certified. And it just happened that I was the first one here in Colorado to notice that there was a gambling problem.
Now all these years later, sports betting has become legal in Colorado. How has that impacted the climate in your view, when we're talking about addiction?
You know, it's just like when casinos first hit, we weren't ready for it. Then all of a sudden, here we open up betting, and we didn't have enough prevention. We didn't have counselors. We didn't have the resources to take care of the people that had the downside of it. So we ended up having to play catch up. And so with the sports betting, it's the same thing as back when the casinos first opened. Now we're playing catch up. The only difference is we had Covid hit at the same time that we opened up the sports betting. And when we opened up the sports betting, everything was closed down, so people couldn't do any recreation. And so the ones that were going to have the downside anyway started gravitating over to sports betting.
And what have you noticed? Are you treating patients now who have sports betting addictions?
You know, it's. It has increased considerably. The people that would not have gambled before it has made it to where they're. They're venturing into it. So we have. And they make it so easy with all the promotions and everything else that they're doing. They're enticing people to. To gamble, and yet we're not hearing the downside of it. So people innocently are learning how to sports bet, and they're making it easy for them to sports bet without information around it. So they're at home, they have nothing else to do. They can do it in. They don't have to get in their car and drive. All they have to do is log on to the computer and they can start doing betting. So there's a population that would have never started gaining gambling if they had to drive and go do it. The other thing is that we're having some of the women also venture into the gambling where we've never seen that before because it was just uncomfortable for them.
Cheryl Atkison
But now getting on the computer and doing it or getting on the phone.
Nancy Lance
And doing it is so easy.
So, yeah, nobody has to look at them. They don't have to be embarrassed about what they're doing. And so they ventured into it without the knowledge that it's going to create problems.
Interviewer
What are some typical stories that you've.
Nancy Lance
Seen when it comes to sports gambling addiction?
You know, I have one gentleman who ended up just. He was working from home and for relaxation, he would. Or on his breaks, he would log in and do some sports betting. And he's ended up with over $200,000 in debt. Well, his wife didn't know he was gambling and they were getting ready to buy a house. It was so frightening for him that she would find out and find out that they didn't have the money for the down payment to the house, that he became suicidal. It just happened that he got caught before he could ever follow through with his thought about killing himself and was referred to me.
Can you say what an outcome is? Is he still in treatment? Did he stop sports betting?
He has stopped sports betting and we have figured out how for him to repay some of the debt that he is. It's going to take him a long time, but he was even using the stimulus checks that the state was giving out or that the government was giving out to try to catch up because he didn't want anybody to know that he had the gambling problem. You know, a lot of people voted for the sports gambling without information about the downside. I don't think there was anybody that was advertising or gave information about what the downside would be. I don't think any of the mental health counselors really knew how bad it was going to be. And then again, it was a perfect storm with COVID hitting.
Can you characterize with sports betting what you saw? I mean, I don't know if there's statewide numbers of how many people have called for help, but when you say it was like a storm that hit, can you characterize that at all?
At first there wasn't a lot of calls because everything was closed down. However, we left the essential workers. Where we left the liquor stores and the marijuana. Pot stores were considered an essential part of the like, just like stores or like the hospitals. So people were staying home using the marijuana and alcohol. And then many of them ended up with COVID So they couldn't drink or they couldn't get their pot and they would go into withdrawals. Same thing with the. With the gambling. If once they got sick they couldn't do it. And there's withdrawal symptoms that people have when they're addicted or when they're chasing their bets trying to recover their losses.
But did you notice personally, did you.
Interviewer
Suddenly get a lot of calls?
Nancy Lance
Did you go from hearing nothing of such a thing? And did you and your colleagues discuss that, gosh, you all got calls and can't take all the clients? Or how did you sense it was bad?
It ended up where we started getting calls. But I also work at a psych hospital and the psych hospital was full. And there's trying to find beds in Colorado for people with mental illnesses is a problem.
And it was full with some people who had sports addiction or marijuana.
Interviewer
What are we talking about?
Nancy Lance
All kinds of mental illness.
So it got worse.
And so of course, the marijuana was part of it, the gambling was part of it, because that's what people were doing when they were staying home is drinking, drugging, gambling.
Cheryl Atkison
That's gambling. Counselor Nancy Lance. Finally now we are going to hear from Chris Kramer, who is the director of casino operations for Bally's Blackhawk in Colorado.
Chris Kramer
Last May, sports betting became legal in Colorado. And so all of the casinos started jumping into the sports betting realm, starting with mobile. Last year, we were under Covid shutdowns and things like that. So the only option for sports betting was through mobile applications. And then later, as the year progressed and things started opening up, the retail operations started coming online.
Interviewer
What's the theoretical benefit down the road of this in terms of revenue for the casino? Because at first, I guess you have an investment in infrastructure and have to figure out how it's going to get going. You don't really know how big it's going to be.
Chris Kramer
Sure, that's a great question. And like everything, we look at it as a complementary piece of our overall business. So it attracts different people in here, people that are used to sports betting or have been going to Vegas and betting on sports down in that market before, or people that are just avid sports fans. So by building out this space, we were able to cater to those people that want to go to a place that enjoys sports and wants to be able to bet on the sports. So that's complimentary to us. Anytime we can get anybody into our building, it's a positive for us because then they can experience everything that we have to offer.
Interviewer
What are some of the things you've learned or found out about so far in the first year or so of having sports betting?
Chris Kramer
I think the biggest thing that we've learned over the last year is just what sports bettors are like. They're different than what we were used to, especially considering that we were operating up until this last May 1st under lower betting limits. So we've had people that came in and bet a half a million dollars on the super bowl in this space right here. We had one better who bet over a million dollars on the super bowl, but he bet one individual bet of $500,000. And that was something that no one in this market was used to, and we certainly weren't. So that was probably one of the biggest things we learned, was just what to expect from sports betting once we saw that.
Interviewer
How did that bet turn out?
Chris Kramer
He won.
Cheryl Atkison
He did?
Chris Kramer
Yeah. He was very excited.
Cheryl Atkison
Yeah.
Interviewer
What did that bring in for him then?
Chris Kramer
I believe he won 475,000 on that one, but I'm not 100% sure on the top of my mind. But he. He definitely won big on the Super Bowl. He's by far probably one of the biggest winners in Colorado ever now.
Interviewer
Wow. What else did you learn? So different types of people come in, attracts different audience. Have you learned anything in terms of how much money you may ultimately earn.
Cheryl Atkison
Or how big a percentage of the.
Interviewer
Casino business it could be?
Chris Kramer
Yeah, I mean, right now, I think that it's a relatively small part of the casino business. On the retail side, what we've learned over the last year is that mobile is really big. A lot of people, because of the convenience of being able to sign up and play from home, plus a lot of the marketing incentives make the online or the mobile betting so much more attractive to a lot of people. But up here, what we learned was that it is an opportunity, like I said earlier, to attract different clientele to come up and bet on various sports. And some of the things that we've learned, too, is just what people like to bet on. Last year, during the pandemic, it was, you know, table tennis in Europe that they were betting on because that was one of the only sports available.
Interviewer
Ping pong and.
Chris Kramer
Yeah, ping pong. And then now, one of the things that one of our better players bets on is various soccer tournaments and play and games around the world. That's one of his favorite things to bet on. So one of the things that we definitely learned about more than anything is just what people bet on, and it's a lot.
Interviewer
Can you briefly describe the changes you made in this area? So we'll. We'll have a wide shot later that shows what did you do, what used to be here and what have you put in?
Chris Kramer
Yeah, so what used to be here was an original bar that was opened in the year 2000 when this casino opened. And it was a little older and needed a fix up and it needed some help. And so what we did is through our partnership with DraftKings and our corporate office, we developed a plan to redevelop the space into what we feel is the premier sports betting and sports viewing space in the entire state. With the number of springs, the bar. Everything that we've done here is to just try to attract different people to our casino who are enthusiastic about sports betting.
Interviewer
If someone comes in here and they want to bet on something almost unhurt that people have never heard of, is.
Cheryl Atkison
That available or is there a limited.
Interviewer
Repertoire of things that is presented to them to bet on?
Chris Kramer
So most of the markets, which is what we refer to those as, are the bigger markets. However, through our partnership again with DraftKings, we are able to almost bet on anything. I mean, getting back to some of the obscure things that have been bet on here, Chinese basketball, something I didn't know was really big, is something that a lot of people were betting on here. And if there's ever some market that any of our players want to bet on, sometimes we just have to pick up the phone and call, you know, DraftKings and say, hey, we've got people that want to bet this market and they will look into it. And so they can open up markets in almost anything that's related to sports.
Interviewer
Sports betting seems to be coming to more and more states. There are a lot of people who don't know much about it and there are a lot of people who maybe think they're against it. What are there any negatives and what would be your answer if someone says I'm worried about this?
Chris Kramer
So my answer is they don't need to worried about sports betting coming because it's already there. Sports betting has been going on in every state pretty much non legally since the beginning of sports. What this does is it brings legitimacy to the industry. It allows for there to be protections in place for the consumers and it allows a safe environment for people to bet where they know that they're not going to have any issues with illegalities or anything like that. They have an opportunity to safely do something that is fun and that a lot of people already been doing so to anybody that has those concerns, I would say the concerns really aren't there. This is just a better way to do something that people have already been doing.
Cheryl Atkison
That was Chris Kramer of Bally's Blackhawk. If you want to hear more about this story, I hope you you'll catch this Sunday's edition of Full Measure where legal sports gambling is the topic of my cover story. That's Sunday, November 21st. You can find a station near you to watch Full Measure on and find out the time by going to cherylakison.com and click the Full Measure tab. There is a list by city and state of where you can watch. If you don't have a Full Measure station in your town, you can always watch online. Super easy Fullmeasure News either live at 9:30am Eastern Time at Fullmeasure News on Sundays or you can watch replays thereafter most any time because we post these segments and the entire program about 11 or noon Eastern time on Sundays after it's aired on television. We also have a free app called Stir S T I R R and it doesn't just have Full Measure live and on demand there, it has that. But it also has a lot of other cool programming and entertainment and even local news. The Sinclair stations have their local news on Stir so you can set your station. It may be the town where you live has a Sinclair station. You can watch your local news on the Stir app live or on demand. Or how about someplace where you used to live? You want to see what's going on in the local news there? Or a city and state where you're curious about. You want to see the local news? Well, check it out on our app Stir. Again, it's free. That's S T I R R. Do your own research. Make up your own mind. Think for.
Full Measure After Hours: Gambling on Legal Sports Betting (From the Archives)
Hosted by Sharyl Attkisson
Release Date: November 7, 2024
In this special archival edition of Full Measure After Hours, host Sharyl Attkisson delves into the evolving landscape of legalized sports betting in the United States, with a particular focus on Colorado—the state that was among the first to embrace this change. Drawing comparisons to the legalization of marijuana, Sharyl explores the substantial lobbying efforts that have successfully transformed sports betting from an illicit activity into a regulated industry. This comprehensive episode features insightful interviews with key figures in Colorado's sports betting framework, shedding light on the benefits, challenges, and societal impacts of this significant legislative shift.
Legal sports betting in Colorado became official on May 1, 2020, marking a pivotal moment for the state's gaming industry. However, the timing coincided with the onset of the COVID-19 pandemic, which led to the closure of casinos—the primary venues mandated by law for placing bets. Despite the initial setback, the introduction of mobile sports betting apps provided an alternative avenue for residents to engage in betting activities from the safety of their homes. This move not only maintained the flow of sports betting but also paved the way for significant financial engagement in unconventional sports like ping pong.
Background and Role
Dan Hartman, with nearly three decades of experience in Colorado's Department of Revenue, serves as the Director of the Colorado Division of Gaming. His extensive background includes overseeing horse and dog racing and pioneering Colorado's medical marijuana program. Dan's expertise positioned him as a pivotal figure in implementing legalized sports betting in the state.
History and Implementation
Dan Hartman [06:00]: "When the United States Supreme Court overturned PASPA in 2018, it allowed states to make their own decisions about sports betting. Colorado quickly took an active role in assessing how to integrate it into our existing frameworks."
Dan elaborates on the legislative journey that led to the legalization of sports betting. The state required a 10% tax on sports gambling revenue, which was earmarked through a statewide vote to benefit Colorado's water department—a choice reflective of the region's prioritization of water management and sustainability.
Revenue and Tax Allocation
Dan Hartman [11:19]: "In our first year, Colorado wagered over $2.3 billion in sports bets. Approximately $6 to $7 million from these wagers are directed to the water fund."
The substantial revenue generated from sports betting not only fills the state's coffers but also ensures regulatory oversight by diverting funds from the black market into a legal, monitored environment. This transition was crucial in enhancing consumer safety and legitimacy within the gaming industry.
Challenges and Observations
Dan Hartman [10:55]: "During the pandemic, all sports betting occurred through mobile apps since casinos were closed. Despite this, we saw betting activities adapt, particularly in non-traditional sports like ping pong, generating significant revenue even in a limited sports calendar."
Dan highlights the adaptability of sports bettors and the unexpected surge in betting on niche sports. Additionally, he addresses the regulatory mechanisms in place to ensure that bettors are physically within Colorado when placing bets, utilizing geofencing technology to prevent out-of-state gambling.
Role and Experience
Nancy Lance, Colorado’s first certified gambling counselor, provides a sobering perspective on the societal impacts of legalized sports betting. With decades of experience counseling individuals with gambling addictions, Nancy offers invaluable insights into the darker side of this recreational activity.
Increase in Addictive Behavior
Cheryl Atkison [22:00]: "How has the legalization of sports betting impacted gambling addiction in Colorado?"
Nancy Lance [22:58]: "With the legalization, especially during the COVID shutdown, we saw a significant increase in gambling addiction. People had nothing else to do and turned to mobile sports betting, which made it even more accessible and insidious."
Nancy recounts how the simultaneous arrival of legalized sports betting and the pandemic created a perfect storm for addictive behaviors. The ease of access through mobile apps meant that individuals could engage in gambling without the social barriers previously present, leading to an influx of new gambling addicts, including demographics that had not engaged in such activities before, such as women.
Personal Stories and Challenges
Nancy Lance [25:06]: "One of my patients, a man working from home, accumulated over $200,000 in gambling debt, leading to severe personal and financial crises. This case, among others, underscores the urgent need for better prevention and support systems."
Nancy emphasizes the lag in preparedness for such an increase in gambling-related issues. The existing support systems were overwhelmed, and resources like psychiatric hospital beds became scarce as individuals battling gambling addictions sought help.
Integration into Casino Business
Chris Kramer, Director of Casino Operations for Bally's Blackhawk in Colorado, discusses the operational aspects and benefits of integrating sports betting into traditional casino settings. The partnership with major sports betting platforms like DraftKings has allowed casinos to offer both mobile and retail betting options, catering to a diverse clientele.
Customer Behaviors and Trends
Chris Kramer [30:27]: "We encountered bettors placing unprecedented large wagers, such as a half a million-dollar bet on the Super Bowl, which was something new for our market."
Chris highlights how sports betting has attracted a different segment of customers, including avid sports fans and high-rollers accustomed to betting in larger markets like Las Vegas. The introduction of sports betting has complemented the casino's overall business, enhancing customer experience and driving additional revenue streams.
Operational Insights and Adaptations
Chris Kramer [32:47]: "Through our partnership with DraftKings, we can offer betting on almost any sport, even obscure ones like Chinese basketball. This flexibility allows us to meet diverse customer interests and continuously adapt our offerings."
The ability to rapidly incorporate a wide array of betting markets has been a significant advantage, enabling casinos to stay relevant and appealing to a broad audience. Moreover, Chris emphasizes the importance of mobile betting, which has become a substantial part of the casino's operations due to its convenience and the enhanced marketing incentives associated with online platforms.
Expansion Across States
Dan Hartman [18:58]: "As of now, 19 states have legalized sports betting, with more considering it. Each state approaches regulation differently, often integrating sports betting into existing gaming structures like lotteries or dedicated gaming divisions."
The national trend mirrors Colorado's approach, with many states recognizing the potential revenue and consumer protection benefits of legal sports betting. The ongoing dialogue among legislators and gaming authorities across the country suggests a continued expansion of legalized sports betting, each adopting tailored regulatory frameworks to suit their unique contexts.
Sharyl Attkisson's Full Measure After Hours provides a multifaceted examination of legalized sports betting in Colorado, offering listeners a deep dive into the economic, regulatory, and social dimensions of this transformative industry. Through compelling interviews with Dan Hartman, Nancy Lance, and Chris Kramer, the episode underscores the significant financial benefits and the equally pressing challenges associated with gambling addiction. As sports betting continues to gain traction nationwide, the insights from Colorado serve as a valuable case study for other states contemplating similar legislative changes.
For those interested in exploring the full breadth of this story, tune in to the upcoming episode of Full Measure airing on Sunday, November 21st.
Notable Quotes:
Dan Hartman [06:00]: "When the United States Supreme Court overturned PASPA in 2018, it allowed states to make their own decisions about sports betting."
Dan Hartman [11:19]: "In our first year, Colorado wagered over $2.3 billion in sports bets. Approximately $6 to $7 million from these wagers are directed to the water fund."
Nancy Lance [22:58]: "With the legalization, especially during the COVID shutdown, we saw a significant increase in gambling addiction."
Chris Kramer [30:27]: "We encountered bettors placing unprecedented large wagers, such as a half a million-dollar bet on the Super Bowl, which was something new for our market."
Chris Kramer [32:47]: "Through our partnership with DraftKings, we can offer betting on almost any sport, even obscure ones like Chinese basketball."
For more information and updates, visit SharylAttkisson.com and FullMeasure.News.