NY Considering Sports League Fee Payments with Sports Betting Legalization

Money changing hands

During the recent Saratoga Institute on Equine, Racing, and Gaming law conference in Saratoga Springs, New York, it was revealed that the state’s gaming officials are thinking about paying fees to professional sports league in connection with sports betting.

Sports betting took center stage in the United States after a ruling in mid-May by the Supreme Court that struck down the Professional & Amateur Sports Protection Act (PASPA). The decision lifted the federal ban on sports betting, and individual states have wasted no time in getting started with sports betting legislation.

One point of contention in several states is the so-called league fees. Professional sports leagues are asking for fees to be paid from sports betting revenues in exchange for their continued monitoring of game integrity. Most lawmakers or gaming venues oppose such fee payments. In New York, it was recently made known that gaming officials are considering paying the fees to professional sports leagues.

Integrity fees being considered

During the recent Saratoga Institute on Equine, Racing and Gaming law conference, several panel discussions were on the agenda, including those focused on sports betting. During one panel discussion, Peter Moschetti, one of the state’s gaming commissioners, said that all components associated with a bill that was introduced in the state senate earlier in the year are being considered, including the integrity fee.

Most of the panel discussion was centered on the integrity fee. A gambling law attorney, Daniel Wallach, used an argument about horse racing to justify the need for integrity fees. The attorney stated that the Interstate Horse Racing Act provides compensation for the racetracks and horsemen for bets placed.

Mr. Wallach said: “I think there is a solid legal foundation for what the leagues are asking for.” The attorney pointed out that the leagues could use the federal law to push for compensation from sportsbooks based on legal terms.

The Chairman of the New York Senate Gaming Committee, John Bonacic, was also on hand to discuss the state’s sports betting plans. Having introduced a sports betting bill back in March, Bonacic is hoping that his legislation will provide a blueprint of sorts for gaming regulators to use in other states as well as New York.

Bonacic’s plans would set an 8.5% state tax on sports betting revenues and a 20% fee to be paid by casino operators to the professional sports leagues. If this bill is passed, it will make New York one of the only states in the US to provide compensation for the leagues.

Opposition to fees

Casino operators are opposed to the fees, pointing out that the sports leagues are already working towards maintaining integrity and fairness in their games. The executive director of online gaming for Foxwoods Resort Casino, Seth Young, commented that casino operators average around a 5% margin on sportsbooks and the fees are unnecessary.

According to him, the regulators should monitor the integrity of the games, not the leagues. The leagues will also benefit from sports betting because the gaming venues will be promoting the games via their sportsbooks.

The panel discussion shows how the integrity fees are still a big issue in sports betting. It will be interesting to see if New York decides to allow the fees and just how much the sports leagues will be paid once sports betting is fully operational in the state.

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