When the Professional and Amateur Sports Protection Act was repealed in 2018, one element was overlooked: Regulators were ill-prepared for the changes that the repeal would bring.
“The explosion, the tsunami wave of expansion that occurred, and certainly in the sports wagering world, just overwhelmed most regulators,” said David Rebuck, the former New Jersey Division of Gaming Enforcement director.
Rebuck spoke during the webinar “State of Gaming Licensing: What’s Changed Since PASPA And What’s Next?” hosted by Jonathan Michaels, the founder and principal of Michaels Strategies, and presented by Speridian Technologies, a leading government agency licensing solution.
“We weren’t prepared for that as a country, for that type of expansion and demands that were put upon many regulators to turn it around and have operations by an artificial period of time,” Rebuck said. “They were just not well thought through. And so, we needed to do things. And how did we do things to adapt?”
Rebuck stated that one way to adapt is that a number of states allow transaction waivers to cut through red tape and allow companies seeking to participate can do so without being fully vetted and approved for full licenses review.
“We’ve used it in New Jersey for 15 years and have had little or no problem with somebody who was given a transactional approval while we continue to finalize the review on them to ultimately not pass suitability,” Rebuck said.
Dan Hartman, former director of the Colorado Division of Gaming, noted that post-PASPA, regulators were often hamstrung by law and regulations passed by legislators.
“A lot of times the regulator’s voice doesn’t really come out to get those things changed,” Hartman said. “You need to have a relationship with your lawmakers to make that happen, but also with the industry to help champion that when it goes into legislation or even bring that legislation forward. You work together as stakeholders to make that work.”
Hartman recalled that soon after PASPA was repealed, the COVID pandemic struck. The traditional method for approving operators was no longer applicable since so many people were working from home.
“We had to embrace how you electronically deal with each employee, each other, and how you as a group deal with it,” Hartman said. “I think it forced us, and I think it forced a lot of regulators, to look at things a little bit differently. We started to put things electronically into files because they had to be shared. We couldn’t just go to a box in the office anymore like we used to do.”
Rebuck said that old methods of regulation – notably going to a racetrack or a casino – now don’t apply to many operators in the gaming industry. Regulators have to embrace technology and engage in different ways of dealing with new companies
“Red tape regulations have to be reformed and engaged in different ways than what we did pre-PASPA,” he said. “And you need to educate your legislators as your supervisory administrative branches of support that you need to access ways of doing things differently that have not been built in prior to the point in time that we’re engaged in today. And then finally, you need to be open-minded and include the industry and their opinions and their access points and how they seek to have revisions made to benefit them.”
Hartman said another crucial element regulators needed to be considered is the omnipresence of artificial intelligence.
“This industry is hugely data driven,” Hartman said. “We need to find a way to make it easier for those folks, the licensees, to get their data to us in a format.
“Also work with legislators when they’re talking or when they’re passing AI legislation that you don’t think has anything to do with your gaming stuff. Make sure you’re engaged. Because AI can be a tool to run through those licenses, to run through that data, to make your job easier. And I think we’re going to see a lot more of that using the data that they give us.”
