Conflicts Rear Their Ugly Head in NY Sports Betting Hearing

Written by:
Gilbert Horowitz
Published on:
May/08/2019
  • Lawmakers bicker over tax to impose

  • Dreaded 'integry fee' rears its ugly head

  • 25% of New Jersey gaming revenue comes from New Yorkers

  • Lawmakers have until July 18 to get a mobile bill passed

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Conflicting interests came to light at Wednesday's hearing related to legalizing mobile and online sports betting in New York.  Currently, only offshore sportsbooks are accessible from the Empire State.

The hearing was chaired by Sen. Joseph Addabbo, the sponsor of the Senate’s sports betting bill.

Gaming operators, representatives from sports leagues, and other gaming interests were present to hear witness testimony for and against mobile sports wagering.

Further differences were voiced in regard to taxation.  The proposed legislation calls for a model similar to that of New Jersey, around 10% at the casinos and slightly more taxed on mobile.

And just as in a handful of other states (i.e. Illinois), the controversial "integrity fee" has reared its ugly head.  The current New York measure calls for an 0.2 percent "integrity fee".  This fee has mostly come to light in states such as New York that are home to a major sports league.    

Bookie.com has an excellent summary on today's hearing:

League representatives further touted the inclusion of so-called “integrity fees” in the bill, which as stands would require gaming purveyors to return 0.2 percent of all gross wagers back for the leagues as a way to invest resources to assure the verisimilitude of their competitions.

Speaking on behalf of the NFL Players Association, public policy counsel Joseph Biggs told legislators these fees were part of a way to protect not just competitions, but the participants. He said NFL players were increasingly anxious about off-the-field interactions with fans in the months since the Supreme Court struck down the federal sports betting ban, allowing states to approve wagering.

Biggs argued resources were necessary not just to educate players about gambling, but to protect them from nefarious bettors – and even those seeking retribution after a loss.

Gaming industry operators agreed that game integrity and athletes need protection, but opposed the current fee proposals to do so.

Those in support of legalized mobile sports betting noted that a quarter of New Jersey's gaming revenue comes from New York residents.  Of the eight states that have allowed sports betting since the US Supreme Court overturned a prohibitive law last May, New Jerey has reported the greatest amount of success. 

Tribal and horse racing interests also have conflicting interests. 

From Bookies.com:

Prior to the court decision, the Seneca Nation of New York argued in court that the commercial tribes infringed on the compact, which gave them exclusive access to provide gaming options within certain territories in exchange for a cut of gaming revenues. When the dispute was settled earlier this year, then gaming regulators finally moved to pass regulations, in an act industry observers say was not coincidental.

Not surprisingly, racing interests believe they should be able to take bets on major league and college sports.

Regardless of how this all transpires, sports betting should be allowed at each of the state's casinos in time for the upcoming Football season per a measure that was already in place that allowed for the activity provided federal prohibition got overturned.

If we were betting folks, our money would be on mobile not happening in this session.  Legislators have until July 18 to get something approved.

- Gilbert Horowitz, Gambling911.com

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