Colleges mull pushing for share of wagering proceeds
Concerned that expanded sports gambling will bring additional costs for ensuring their games are on the up-and-up, college athletic departments are looking for a way to get a piece of the action.
A U.S. Supreme Court decision in May allowed states across the country to join Nevada in having legalized sports betting. Since then, sports books have opened in Delaware, Mississippi and New Jersey. A West Virginia casino is set to take bets within two weeks, with other states not far behind.
Schools in states where legal wagering has started or soon will are considering joining professional sports leagues in pursuing legislation requiring sports book operators to pay them a cut of the amount wagered on their games. College officials say the “integrity fees” would help fund beefed-up programs educating athletes about unscrupulous activities associated with gambling and monitoring betting lines for possible game fixing or point shaving.
The American Gaming Association, which lobbies on behalf of the gambling industry, opposes integrity fees because they would be piled on top of state and federal taxes that cut into profit margins. Also, the AGA says, the pressure of paying integrity fees would result in operators offering less attractive odds than a bettor could get from an illegal bookmaker.
Legal sports books keep about 5 percent of the total money bet, and the proposed integrity fee typically is 1 percent. That would mean 20 percent of the profit would go to the recipients of the fees, said Sara Slane, the AGA’s senior vice president of public affairs.
“It’s absolutely absurd. There is no business that would agree to that,” she said. “It’s not going to accomplish ultimately what I think the leagues would like to see, even the colleges would like to see, which is to have regulated, legalized sports betting and consumers partaking in that platform versus continuing down the path of the illegal market.”
There are no known estimates for how much money integrity fees might raise for an individual school, which would receive fees based on the amount of money legally wagered on its games.
“You’re not talking about millions of dollars,” said Andy Humes, executive associate athletic director for compliance and administration at Missouri. The state in 2019 likely will continue debate on gambling legislation that began this year.
Professional leagues contend they’re entitled to integrity fees because sports books are making money off their product and, with more wagering opportunities, the leagues must devote more resources to monitor betting lines for unusual activity.
The NBA and Major League Baseball led an effort in New York to secure a 1 percent integrity fee — eventually reduced to onequarter of 1 percent — but the bill didn’t make it to the floor before the session ended in June.
While integrity fees have been a non-starter so far, universities that deal with unpaid athletes and are politically well connected in their states aren’t discouraged. West Virginia lawmakers probably will revisit integrity fees next year.
Athletic directors Shane Lyons of West Virginia and Mike Hamrick of Marshall attended a May meeting where integrity fees were discussed. Both said they want their expenses offset for the extra monitoring of athletes and educating them on risks associated with gambling.
“I think at some point, someone has to say we’ve got to help the two universities in this state to make sure they don’t become another Boston College or a Northwestern,” Hamrick said, referring to past pointshaving scandals at other colleges.
Hamrick said he would be able to hire additional compliance staffers immediately if colleges receive compensation. He also would bring in speakers to talk to the athletes.