Industry observers are debating the difference between an “integrity fee” and a “royalty payment” following the introduction to the New York House of Assembly this week of a sports betting amendment draft that whilst closely following its equivalent in the state Senate, has a different take on the US sports leagues’ demands for an “integrity fee” in state sports betting legislation.
Both bills acknowledge the need for a one-quarter percent of all wagers contribution to the sports leagues (the so-called “integrity fee”) but the Assembly bill draft submitted earlier by Assembly Racing and Wagering Committee chairman Gary Pretlow described the proposed payment as a “royalty fee” with no strings attached.
In that respect it followed Senator John Bonacic’s equivalent bill in the Senate, although that bill requires the sports leagues to petition annually for the integrity fee.
In his latest draft, Pretlow retains the “royalty” title for the fee but now imposes the integrity fee-style Senate requirement that the leagues claim annually for the “royalty” every April 13.
Within 30 days of submitting their claims the leagues must meet with a Commission established by the bill to provide “evidence of policies, procedures and training programs it has implemented to protect the integrity of its sports events.”
That seems to be in conflict with the concept of a set royalty fee, and is more in the nature of the integrity fee outlined in the Senate bill, which contains the same requirements for the leagues, and requires that they publish an annual report on usage of the integrity fees, which will be subject to audit by the Commission (the Assembly draft does not include this annual reportage).
Pretlow’s latest draft does add a stipulation not in the Senate bill that sports governing bodies registered to obtain the fee must be headquartered in the US.
With this sort of wrangling going on, it is beginning to look doubtful that the state legislature will be able to pass a final sports betting law before a scheduled adjournment on June 20.