Photo | Daniel Anderson

The Beau Rivage in Biloxi was the site for the state’s first legal sports bets last week as Mississippi became just the fourth state to allow gambling on sporting events following a U.S. Supreme Court decision allowing states to legalize sports books.

When it comes to predicting what will happen in sports, legendary oddsmaker Danny Sheridan literally wrote the book. However, gaming enthusiasts might be dismayed by the recent odds he gave Alabama of seeing legalized gambling across the state anytime soon.

“I would make the prediction — and I hope I’m wrong — that the Alabama Legislature will let the people vote on a lottery, casino games or sports betting when Donald Trump kneels for the National Anthem,” Sheridan said.

That’s a grim outlook for those in the Yellowhammer State who’d like to get in on the action — and potential revenue — its neighbor to the west continues to develop. Just last week, Mississippi became the fourth state to allow legal betting on sporting events.

Sheridan, a Mobile native, was a featured guest for the grand opening of the Sports Book & Bar at the Beau Rivage Resort and Casino in Biloxi. There, he placed one of Mississippi’s first “legal” sports bets, and if his reputation holds true, fans of Alabama and Auburn football could be in for a disappointing season.

“I bet Auburn to win under nine and half games this year, and I picked Clemson to win the National Championship because I don’t like the odds on Alabama,” he said. “I also bet $5 on LSU because several of my friends love LSU. I asked them if I could bet a penny.”

Sheridan, who says he doesn’t gamble on sports, placed bets for charity alongside former NFL pros Robert Royal and Willis McGahee and several state officials. Three hundred miles to the north, a similar event was held simultaneously at the Gold Strike Casino Resort in Tunica, Mississippi.

While those first bets were staged, they were followed by hundreds of bets from casino guests — many of whom had stood and waited for the ceremony in Biloxi to end. In less than 48 hours, a representative of the Beau Rivage said “thousands of bets [had] been placed.”

All 12 Biloxi casinos plan to offer sports betting, and while it may not be a game changer economically, it is expected to draw in new customers. It’s also no coincidence that the launch of sports betting came just weeks before football season kicks off.

Mississippi regulates and collects taxes from legal gaming activities in the state’s 36 waterfront casino properties, though revenues have actually been in decline since 2008. Still, gambling has generated $300 million to $350 million every year for the last decade.

Sheridan told Lagniappe that, like lotteries in neighboring states, a good chunk of the gambling revenues Mississippi collects likely comes from Alabamians crossing the state line. Given the popularity of college football here, he believes that will also be the case with sports betting.

“For illegal football betting, Alabama, per capita, is the largest state in the country. Huge is not the word,” he said when asked what the state could be missing out on. “Alabamians put millions of dollars into lotteries in other states, and then half of Mobile and Baldwin counties go to Mississippi to play at the casinos. That’s a lot of money in taxes.”


Hedging your bets

The rush to legalize sports betting at the state level started in May, when the Supreme Court of the United States (SCOTUS) struck down the Professional and Amateur Sports Protection Act of 1992 — a law that had prevented states from allowing any kind of sports gambling for nearly three decades.

Its intent was to protect the integrity of competitive sports, but the court found it to be an unconstitutional violation of states’ rights, concluding that: “It is as if federal officers were installed in state legislative chambers and were armed with the authority to stop legislators from voting on any offending proposals.”

Mississippi lawmakers did some gambling of their own when they passed the state law legalizing sports betting. It was included as part of a bill related to daily fantasy sports signed into law in March 2017, more than a year before the SCOTUS decision.

State Rep. Richard Bennett, a former chairman of the House Gaming Committee, authored most of the bill and said the decision to pass it ahead of time is the reason Mississippi is one of the first three states to launch sports betting following the ruling.

“Even though we knew it was illegal nationally at the time, we felt and hoped the Supreme Court would rule that it was constitutional,” he said. “The [Mississippi] Gaming Commission had already started putting together rules and regulations and was ready to move in anticipation of the ruling coming down in our favor. We were one step ahead, and we’re proud of that.”

In all, the rules the gaming commission put together are similar to those used in Las Vegas. Bets have to be made at licensed casinos and can be placed on any sport at the professional or collegiate level, including Olympic games and horse or greyhound races.

Coaches and athletes are prohibited from betting on teams they’re affiliated with, bets can only be placed by those 21 and older and wagers can’t be made, nor winnings collected, on someone else’s behalf. Winning wagers also expire 30 days after the event on which they were made.

Mississippi’s edge in the world of sports betting isn’t poised to last long, though, as 20 states have introduced bills that could legalize the practice in the future. Sheridan said that speaks to its popularity and the prevalence of the illegal sports betting that’s existed for years.

“You have this pent-up demand because most people, male and female, have an opinion on sports,” he said. “Forty million Americans are illegally betting probably $7- or $8 billion a weekend, and now they’re not criminals anymore.”

Most observers would say Sheridan’s valuation of the market for illegal sports betting is high, but then again, it’s tricky to get accurate data on clandestine activities.

A study by the American Gaming Association put that figure at around $150 billion annually, though other economists — using legal sports betting in the United Kingdom as a basis — have estimated illegal gambling brings in around $67 billion a year in the U.S.

Whatever the number, it’s big — so big that Jay Rood, vice president of race and sports for MGM Resorts International, told Lagniappe the “black market” remains the company’s “biggest competitor.”

While legalized sports betting might cut into some of that underground market, Sheridan said he doubts it’s something underground bookies are very worried about. He says there’s such a demand for sports betting that the rise of a legal industry likely “won’t affect them at all.”

“If I’m an illegal bookmaker, and you’re my clients, you’re going to still be my clients, but there will be 20 or 30 others who don’t know me who can’t wait to go to Biloxi and bet on their favorite teams,” he added. “And why shouldn’t they be allowed to do that? You cannot legislate morality in this country. We’ve tried, and people are going to drink too much, they’re going to smoke too much, they’re going to eat too much.”


How it works

The Beau Rivage was able to provide a space for sports betting quickly by renovating an existing restaurant and bar on the property. It still offers food and drinks, but now patrons can also watch games they’ve placed a bet on play out in real time.

Rood, who came from Nevada to oversee the development of the resort’s sports book, said Beau Rivage visitors will be able to place bets from anywhere on property using a smartphone.

“We’re going to introduce a mobile app in probably in a month, or as soon as we get an approval from the gaming commission,” he said. “You’ll be able to make a bet anywhere on the property that you want, whether you’re in the poker room, at the blackjack tables or in the nightclub.”

Rood said the law adopted in Mississippi also keeps open the possibility of allowing off-premises betting in the future, though that’s probably a long way off, if it happens at all. However, if approved, it would allow bets to be placed remotely from anywhere within the state, which Rood said could help licensed casinos compete with black market betting.

At the Beau Rivage, there is a steep list of possible bets to be placed within a single game or through an entire season. Over/unders, point spreads, outcomes, parlay, prop bets — if it happens in a game, you can mostly likely place a bet on it.

While they have a shorter window, season-long bets can be made on total wins, losses and championship winners — something Beau Rivage Manager of Race and Sports Booking Mike Hall expects to be very popular in SEC football country.

“We’re going to have overs and unders on total wins by each team in the conference, but once the season starts, those bets are taken down,” Hall said. “We’re also taking odds to win the SEC championship. Something like that might progress a little bit into the season, and those odds will change to reflect how each team is playing.”

However, what might be exciting news for sports fans has been a concern for those who oversee collegiate athletics. For the NCAA, the new legal landscape is likely to have a tangible cost, as the association works to educate players, coaches and support staff on what they can and can’t do.

It will also likely have to address how injuries are reported. While the ACC has established a system for disclosing player injuries, other conferences — including the SEC — have not. That’s the type of information oddsmakers would like to have, and it could lead to trouble if it were leaked by someone associated with an NCAA program.

The NCAA has suspended its ban on locating championship events in states where sports wagering is legal but says it has no plans to financially benefit from sports wagering like some professional sports associations have discussed. Instead, it has remained focused on education.

“While we certainly respect the Supreme Court’s decision, our position on sports wagering remains,” NCAA chief legal officer Donald Remy said in a statement released last month. “With this new landscape, we must evolve and expand our longstanding efforts to protect both the integrity of competitions and the well-being of student-athletes.”

At SEC Media Days last month, Commissioner Greg Sankey said gambling on collegiate sports is nothing new, but with two major SEC football programs only a few hours from the casinos, Mississippi’s legalization of sports betting could be a challenge for the conference.  Sankey also made no secret of his view on the “increased cultural acceptance” of sports betting.

“While it may be preferred to have no expansion of gambling activity, what is needed now is for our state and federal legislative leaders to enact policies that properly support the integrity of our games and provide the necessary protections for our students and our student-athletes,” he told reporters.


Could Alabama follow suit?

Data from daily fantasy sports operators, some of which were declared illegal in a 2016 opinion from Attorney General Luther Strange, indicates a number of Alabamians are interested in sports gaming.

Marc La Vorgna, who’s represented both FanDuel and DraftKings, estimates there were 775,000 players in Alabama across all fantasy sports operators prior to Strange’s opinion.

While many Alabamians may be interested in sports betting, some observers say it’s unlikely it will be legalized here because of the state’s long history of opposition to most forms of gambling.

Alabamians voted down a constitutional referendum on a state lottery in 1999, though some polls show attitudes across the state have since shifted. Regardless, many elected officials remain opposed to any form of gambling or a state lottery.

The only legal gambling that exists in Alabama today is at properties owned by the Poarch Band of Creek Indians, but state law prevents even those facilities from having table games like blackjack and poker. It’s a sore subject with Sheridan, and he’s not shy about his criticisms.

“Our legislators think we’re smart enough to elect them, but we’re not smart enough to vote on a lottery, casino gambling or sports betting,” he said. “They’re gutless. The religious right that scares these politicians … they exist, but if they were such a power, we’d have Roy Moore as our senator.”

However, there are still those who oppose the gambling or a lottery.

Some — including the “religious right” — have objected to gambling on moral grounds due to its impact on low-income residents and potential to become addictive. Groups such as the Alabama Citizens Action Program have long opposed any type of lottery or gambling expansion.

Other conservative groups, like the Alabama Policy Institute (API), have taken a more philosophical opposition to using gambling to fund the government. Lagniappe reached out to API for comment on this report but did not receive a response.

However, when the state Legislature was considering a lottery referendum in 2016, API decried it as an attempt to con Alabamians “into handing over more of their money.”

“Make no mistake, the lottery is a tax — a hidden tax, disguised as entertainment, and supplied through a state-run monopoly — and it will almost assuredly lead to more taxes as politicians are further enabled to avoid the kinds of tough decisions that they were elected to make,” API wrote.

With the governorship and several legislative seats up for election, it’s an issue that has come up on the campaign trial now that states can make their own decisions on sports betting.

Gov. Kay Ivey’s campaign did not respond to a request seeking her positions on gambling and sports betting, but she has publicly stated her opposition to legalized gambling in the past.

However, Ivey has also said the public should be allowed to vote on the matter. During an unsuccessful bid for governor in 2010, Ivey proposed offering the people a simply worded referendum: “Do you support the legalization of casino gambling, yes or no?”

Conversely, Democratic gubernatorial candidate Walt Maddox has based much of his platform on the passage of a lottery and is open to discussions about other forms of gambling in the state.

“It’s revenue that can help, whether it’s with mental health, corrections or adding state troopers to our highways,” Maddox said. “There’s an opportunity for, conservatively, somewhere between $400 million to $500 million between the lottery, gaming and sports gambling that we could invest in Alabama without raising taxes. We absolutely need to be pursuing those.”

Any movement to considering something like sports betting will likely focus on whether it constitutes a game of skill or a game of chance. That same issue came up last year when the Legislature was discussing daily fantasy sports, which were found to be illegal in 2016.

The distinction between “chance” and “skill” matters in Alabama, though, because games of chance can’t be approved by the Legislature and have to go through a constitutional referendum.

Attorney General Steve Marshall has previously said that, because of the different opinions on whether sports gaming is a skill, a referendum would be the best option because any “statutory legalization of sports gaming would surely be met with protracted court challenges.”

However, if you ask Sheridan, who provided the daily odds for USA Today for three decades and has been featured on television shows and in newspapers around the country, he’ll tell you his lengthy career would not have been possible if sports betting wasn’t a skill.

“When Alabama is playing Louisville, and they’re a 26-point favorite, that’s not a chance because you have to, hopefully, have some knowledge of Louisville and Alabama,” he said. “I predict point spread winners every week for my clients. It’s my living, and I’ve done it all my life. I wish to hell it were chance, because I’d rather be lucky than good any day.”