West Virginia has dealt a blow to the major US sports leagues after integrity fees were not included in the state’s revised betting rules.
Sports betting is already live at two of the state’s five casinos – with mobile betting expected soon – however firms have been operating since August on temporary rules. The state's Lottery Commission approved the final regulations yesterday (Wednesday) after reviewing 18 suggested amendments. It rejected all seven proposals put forward by major sports leagues, including a plan for integrity fees of 1% of turnover put forward by the leagues.
The Lottery Commission said it believes such fees, if desired by both sides, should be agreed between the leagues and betting operators.
The Commission said: “The Lottery declines to intervene between negotiations between private business entities.”
The NBA, MLB and PGA Tour had set out their case in a letter to the Commission ahead of the meeting.
They wrote: “If the Sports Wagering Rule does not include strong and reasonable integrity protections the leagues are seeking, legalised sports gambling in West Virginia will deprive the leagues of important tools to detect and prevent manipulation and corruption.”
John Cavacini, West Virginia Racing Association president, said the casinos he represents are interested in discussing the proposals with the leagues.
He said: “The tracks on an individual, contractual basis are available and quite frankly, want to, want to negotiate from a private sector standpoint as opposed to the legislature saying, ‘Hey, you either buy it from these guys or you’re not going to do business in West Virginia.’”
Earlier this week, the AGA's Casey Clark told iGamingBusiness.com that the introduction of integrity fees – or, in essence, a 'betting right' – would prove a negative move.
Speaking after the release of a report that suggested the NHL could benefit by $215m per year if it embraces betting, Clark said: “The results of this study are very clear: Widely available, legal, regulated sports betting will create huge new revenue opportunities for sports leagues like the NHL, without mandating the transfer of revenue from one highly regulated industry to another industry.”
The commission approved two rule changes, including allowing those using the sportsbook app to check their accounts – but not bet – while in another state. The modified rules now go back to lawmakers for their approval, after which they will become the long-term legislative rules enforceable by law.
Under the terms of the rules agreed earlier this year the licence fee in West Virginia is set at $100,000 (€85,500) and casinos are required to pay the state 10% of sports betting revenue in taxes.
Earlier this week, Erich Zimny, vice-president of racing and sports operations at the Hollywood Casino, said mobile betting could be available before the end of October.