New NY Sports Betting Bill Changes ‘Integrity Fee’ Language To ‘Royalty’

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Pug wearing a Crown

New York Assemblyman Gary Pretlow is giving the professional sports leagues what they want on NY sports betting, but he’s calling it what it is.

Legal Sports Report obtained a copy of the long-awaited sports betting bill that Pretlow will introduce this week; you can see the draft here. Most of the language is identical to Senate bill introduced and later amended by Sen. John Bonacic, including the same one-quarter percent of all wagers going to the sports leagues on which wagering will occur.

However, while Bonacic calls the money to leagues a “sports wagering integrity fee,” Pretlow identifies it as a “sports wagering royalty.”

A rose by any other name …

In April, Pretlow told LSR that the leagues asking for an integrity fee seemed “disingenuous.” While the leagues surely do value maintaining a reputation for the integrity of their games, and there are costs associated with data monitoring and integrity protocols for sports wagering, Nevada pays no such fee.

Neither do regulated European markets that offer bets on US games, nor the virtually unregulated offshore websites. The neighborhood bookie also isn’t kicking back to the leagues. Taking the tens of billions of dollars that Americans wager on sports through the black market and putting them on state-regulated sites would seem beneficial for integrity concerns.

While it sounds more official and proper to receive an integrity fee, the leagues don’t figure to mind it being termed as a royalty because it comes with no strings attached.

The Senate bill has four hoops the leagues have to jump through to get the money:

In Pretlow’s bill, the casinos simply determine the percentage of wagering attributed to each sport and pay out the money.

Origin of the integrity fee

The NBA and Major League Baseball, in preparation for the US Supreme Court decision on Murphy vs. NCAA that struck down the federal ban on wagering earlier this month, really got its lobbying efforts for an integrity fee going in January at a New York Senate meeting of the Racing, Gaming and Wagering Committee.

The leagues initially asked for a full percent of each bet, a figure that would make up about 20 percent of the revenue from wagering, judging by results in Nevada. When some state lawmakers balked at such a high figure, the leagues started working on a compromise of one-quarter of a percent.

At the Senate committee hearing, the NBA submitted written testimony asking for a “comprehensive sports betting bill that would serve as a model for a 50-state solution.” New York often sets the example for policy that other states follow, and now – call it what you want to – the leagues have bills in each legislative chamber set to provide them with a piece of the wagering pie.