Indiana House bill includes 1 percent 'integrity fee' for NBA, MLB
— -- The NBA and Major League Baseball are asking for a piece of the action in an Indiana bill that aims to legalize sports betting, according to an Indiana lawmaker.
House Bill 1325, introduced Monday by Indiana Rep. Alan Morrison, would authorize sports wagering at the state's riverboats, racinos and satellite facilities, if federal law changes.
Morrison told ESPN that he received input on the bill from NBA and Major League Baseball regarding an "integrity fee" that sports betting operators would have to pay to the sports leagues. The fee is "1 percent of the amount wagered on the sport's governing body's events" and would be required to be submitted on a quarterly basis.
"We've certainly had some input and welcomed some advice and language that makes the leagues feel a little bit more comfortable," Morrison told ESPN on Monday.
Spokespersons for Major League Baseball and the NBA declined comment.
The Indiana bill is a long ways away from passing and would only go into effect if the federal ban on state-sponsored sports betting is lifted. The United States Supreme Court is reviewing the Professional and Amateur Sports Protection Act of 1992, the federal prohibition on state-sponsored sports betting, which restricts legal sports betting to Nevada and a handful of other states.
The Supreme Court is expected to release what could potentially be a landmark decision sometime in the next six months.
The NBA and Major League Baseball are taking pre-emptive steps ahead of the decision. In addition to the integrity fee, Morrison's bill would give the leagues rights over what types of wagers are offered and require operators to use official league data in some cases.
The 1 percent integrity fee raised eyebrows in the sports betting industry. Nevada's sportsbooks' net win on bets is 4-6 percent, on average.
"While we applaud Representative Morrison's efforts to bring legal, transparent sports betting to Indiana, handing sports leagues 20 percent of what's left over after winnings are paid out, undercuts its economic viability," Geoff Freeman, CEO and President of the American Gaming Association, said in a statement. "Doing so will ensure the illegal market continues to thrive in the state, and gut the tax revenues available to fund essential public services. We believe Indiana taxpayers deserve better.
"We encourage Indiana to reject this short-sighted, misinformed idea, which simply replaces a failed federal prohibition with bad state policy. Our goal is to eliminate the illegal market, protect consumers and strengthen the integrity of the game. We invite all stakeholders to join us in working together in a thoughtful and transparent fashion."
The NBA has been the most outspoken proponent of expanding legal sports betting in the U.S. Until now, the NBA and Major League Baseball had only publicly supported a federal approach to sports betting.
Indiana is one of close to 20 states that have introduced sports betting legislation in recent years. It is believed to be the first one known to include input from the sports leagues, some of which have begun to shift their position on sports betting.
The NBA and Major League Baseball remained plaintiffs, along with the NFL, NHL and NCAA, in a suit against New Jersey's effort to legalize sports betting, which, after a five-year battle, reached the Supreme Court.
The NCAA, which is headquartered in Indianapolis, declined comment on the pending legislation. Morrison said he has not had any recent discussions with the NCAA regarding his legislation, which would allow for betting on college sports.
The NFL was not part of the discussions in Indiana, sources told ESPN, and recently declined to comment on its current position on the legalization of sports betting.
