Capital News Service//Michael Charles//April 5, 2023
//April 5, 2023
ANNAPOLIS – A week after the University of Colorado ended a controversial deal with a sports-betting sponsor, Maryland legislators are on the brink of passing legislation to limit agreements between universities and gambling companies.
But some say the legislation doesn’t go far enough in that it would not stop the companies from marketing to students and does not fully address the need for transparency.
The University of Maryland, College Park is the only school in the state with a betting sponsorship. Its partner is PointsBet, the same company that had a deal with the University of Colorado. And, in a twist of contract law, the legislation will not apply to UMCP.
Colorado’s deal was altered in January after criticism about the university receiving a $30 commission when anyone, including students, used a CU promotional code with PointsBet.
“The real-life effect of this proposed bill in Maryland is like giving a knee brace to an emergency room patient with a gushing head. This bill is an attempt to give the appearance that something is being done on this but the reality is, nothing is being done,” said Les Bernal, national director of Stop Predatory Gambling. “They’re promoting online gambling, a dangerous addictive product, that the American Psychiatric Association has identified as dangerous and addictive as opioids, heroin and cocaine.”
HB 0802, primarily sponsored by Del. Jheanelle Wilkins, D-Montgomery, has been cross-filed with SB 0620, sponsored by Sen. Shelly Hettleman, D-Baltimore. The bills were approved by their originating chamber unanimously. A final vote on the legislation should come before the General Assembly adjourns for the season on Monday night.
The purpose of the sports-betting bill is to ensure “that our Maryland institutions of higher education are not profiting from the sports betting activities of our students. We don’t want our students to be exploited or be harmed or get addicted,” said Wilkins. “The next aspect of the bill is transparency. It makes the public able to inspect the contract with sports betting companies and their agents so that we can actually take a look at what those contracts look like and what is going on.”
Hettleman provided a similar perspective regarding the need for transparency in contracts between gaming companies and institutions of higher education.
“Many of them, it seems like, in order not to have to make those (contracts) transparent, have a middle man and they have what’s called a sports marketing firm,” said Hettleman. “So technically the contract is between the university and the marketing firm, and not the university and the gaming company.”
That is the arrangement that UMCP has on sports betting, and yet it would be allowed to continue under this legislation because the contract existed before the legislation would be approved. UMCP has a contract with the sports marketing firm PlayFly Sports. PlayFly created a company just to deal with UMCP marketing deals called Maryland Sports Properties. It is PlayFly’s Maryland Sports Properties that contracted with PointsBet to be the official gaming sponsor of Maryland athletics. Even if this legislation passes, sponsors say, the contract cannot be undone and is not subject to legislators’ calls for transparency.
University President Darryll Pines’ office, UMCP Vice President of Marketing and Communications Brian Ullmann, UMCP Executive Director of Government Relations Ross Stern and UMCP Director of Athletics Damon Evans all failed to return calls seeking comment on the legislation’s impact at Maryland.
It is unclear whether UMCP’s contracts have any extrication clauses or how long the contract extends because the university has declined to release it, arguing that the contract is actually between PlayFly/MSP and PointsBet and not the university itself.
The legislation aims to prevent colleges and universities from profiting from student gambling by barring colleges from accepting any referral fees and other incentives. It was also amended to prohibit educational institutions from entering such contracts through a third party. And it was designed to enhance transparency around gaming contracts, saying that all such contracts are, “subject to public inspection in accordance with the Maryland Public Information Act.”
The bill does not prevent students from using betting platforms, nor does it require UMD to disclose the terms of its existing contract.
Del. Jason Buckel, R-Allegany, a lawyer by trade, addressed the legal reality of the potential legislation.
“My understanding is, as an attorney and certainly as a legislator, is that we can’t pass legislative acts that impair existing contracts. That would give that company rise to a lawsuit,” said Buckel. “That was probably a necessary component of the bill, that if an existing contract was there, you had to follow it. But then we were not looking to expand upon those things for additional opportunities.”
Buckel said the legislation should prevent similar deals in the future, but others are skeptical of the bills’ purpose and timing.
“If legislators were serious about addressing this outrageous partnership that exists between PointsBet and Maryland,” said Bernal, “they would eliminate the ability of any state university to partner with an online gambling operator, period.”
Dr. Timothy Fong, Clinical Professor of Psychiatry at UCLA, said that gambling should be viewed in a similar way to tobacco, alcohol, cannabis and other addictive substances. “We know that the reason why this activity is an adult-only activity is because people aren’t ready for it. Physically, mentally, socially, and economically,” Fong said. “It doesn’t make a lot of sense that an administrator who supposedly has the best interest of the community and students, doesn’t understand in that very first meeting, ‘Wait, this is not for kids.’”
Fong attributed the termination of CU’s deal to public scrutiny of sports betting deals with universities.
“We all make mistakes, right? If they just tap out and pull out now because of an error, that’s fine. But why are they tapping out? It’s because of pressure from the media,” said Fong. “They’re tapping out because if they don’t do it right now, that pressure is going to build and build and build.”
In November, the New York Times reported that universities and colleges, including Maryland, were making millions of dollars from partnerships with gaming companies that introduced both their students and sports fans to gambling.
The Shirley Povich Center for Sports Journalism and the Howard Center for Investigative Journalism at Merrill College of Journalism at the University of Maryland reported in February that some universities shield their sports betting agreements by working with third-party marketing companies. The Povich and Howard centers reported on a close relationship between the University of Maryland and Maryland Sports Properties. Some MSP officials had university-issued email accounts and an office at Xfinity Center, the athletic venue where many UMD sports teams play and some coaches and administrators have offices.i