Washington D.C. Council Drops League Demands from Sports Betting Plan

Posted on: November 29, 2018, 07:23h. 

Last updated on: November 29, 2018, 07:23h.

Philip Conneller @casinoorgphilc Read More
Expertise: Gaming Business, Regulation, Tribal Gaming.

In a snub to America’s sports leagues, D.C. City Council has removed language from its sports betting bill that would have seen the leagues reap a so-called “integrity” fee from a future wagering market, SportsHandle reports. The Council has also removed the mandate that would require operators to use official league data.

D.C. sports betting
Washington D.C.’s sports betting legislation will progress minus league demands. The leagues’ best chance to impose their will on the sports betting landscape may lie now a few blocks away from the D.C. Council building, on Capitol Hill. (Image: Shutterstock)

D.C. Councilman Jack Evans announced his intention to regulate sports betting in September after hearing a West Virginia casino was directly marketing to D.C. residents because it was “the only game in town.”

There are no casinos in D.C., which means the district’s residents head to the Hollywood Casino in Charlestown, West Virginia, or the MGM National Harbor in Maryland, whose location was strategically chosen by MGM to cater to the D.C. market. Evans hopes authorizing “online and in-person wagering” in the nation’s capital will help to redress that balance and bring a new revenue stream into the district’s coffers.

Model Legislation

Meanwhile, the leagues have been lobbying states that are considering regulating sports betting with their own “model legislation” that includes the so-called integrity fee — a cut of all bets placed on their games.

The leagues were originally asking for one percent of handle, which would equate to roughly a 25 percent tax on gross gaming revenues on top of state and federal taxes — enough to strangle the market. They have since modified that to .25 percent, but it’s little surprise that the concept has been roundly rejected by all states that have regulated thus far.

After all, lawmakers are looking at sports betting as a means to increase state revenue, not line the leagues’ pockets.

Integrity Fee ‘Huge Amount of Money’

Realizing their interests may be best served by uniform federal regulation, the leagues are lobbying Congress, while a few blocks away D.C. Council is busy striking their demands from its own legislation. Nevertheless, Evans felt torn by the decision to reject the leagues’ proposals.

There is not [an integrity fee] anywhere else in the country and it’s unclear if anyone else will have one,” he said at a hearing on Wednesday. “I am trying to balance things here … trying to help the leagues, but I cannot provide what they want.”

“They wanted 0.25 percent of handle, that’s a huge amount of money,” he continued. “What I’m willing to do is 0.25 of everything left over (after payout, expenses). … And they will give us access to logos, trademarks that would be helpful in selling this stuff. I can’t say it’s right, but I’d like this to pass the way it is today.”

The Council unanimously voted against the integrity fee and the official data mandate and set the date for a first reading for December 4 in the hope that it can go to a vote on December 16. Once approved it would need to be ratified by Congress.