Sports Betting and the 1% ‘Integrity Fee’ Explained
In case you haven’t been paying attention, the federal ban on sports betting as established by the Professional and Amateur Sports Protection Act of 1992 (PASPA) was struck down recently by the US Supreme Court.
A lot of people incorrectly read between the lines and thought that this means INSTA-LEGALIZED SPORTS BETTING across the country.
As I outlined in a previous piece, Sports betting and SCOTUS, what it all means and what’s next? this isn’t the case.
This ruling merely puts the option and onus on states and tribal nations to allow or not allow sports betting.
If allowed at the lawmaking level, these same entities then must create the rules and regulations related to those wagers. Some states were prepared to move forward quite quickly to get their sports betting to market (laws passed, and regulations set), others will take longer. There will inevitably be some states and/or tribal nations which elect not to allow sports betting at all or will only allow limited flavors of sports betting.
In the conversations surrounding this decision, the professional sports leagues reaffirmed their general opposition to this ruling with the NFL even stating that they wanted Congress to intervene. In a statement, the NFL proclaimed: “Congress has long recognized the potential harms posed by sports betting to the integrity of sporting contests and the public confidence in these events.”
Amongst all the noise and under the headlines, the NBA, PGA and Major League Baseball reiterated their support for what is being called an integrity fee that deserves more attention, discussion and thought by stakeholders in the industry and the general wagering public.
The purpose of this paper is to shine a light on the proposed integrity fee. Specifically, I’ll talk about the concept as well as the origin of this idea, where integrity fees stand now and what questions vested interests might want to ask themselves.