California on cusp of creating MMA retirement fund
Josh Hokit was unaware of the legislation awaiting Gov. Gavin Newsom's signature that would establish the California mixed martial arts retirement benefit fund.
The 25-year-old heavyweight from Clovis, a football player and two-time All-American wrestler at Fresno State, has things other than the end of his career occupying him leading up to his professional MMA debut on Saturday in San Diego at the Pechanga Arena.
“I feel good. I feel excited,” said Hokit, who meets fellow debutant Spencer Smith in a three-round contest to open the preliminary portion of the Bellator 300 event. “I acknowledge there is some stuff that's kind of up in the air because I've never stepped in a cage and competed against another man.”
If Newsom signs AB 1136 into law, Hokit and more than 400 mixed martial artists currently licensed by the California State Athletic Commission would need to accrue 39 scheduled rounds in the Golden State starting next year to vest into the retirement benefit fund.
Introduced Feb. 15 by Assemblymember Matt Haney (D-San Francisco), the pending law does not retroactively cover fighters.
Mechanisms in the language of the bill — on top of a $1 assessment on event tickets sold — could deliver revenue “generated through the sale of special interest license plates and other commission-branded items, including, but not limited to, sport paraphernalia and souvenirs, and by contributions from mixed martial artists, managers, promoters, or any one or more of these persons.”
Andy Foster, the athletic commission's Executive Officer, envisions multiple streams of revenue for the pension plan that was mentioned among seven stated goals in the commission's strategic plan from 2019 to 2023.
“This isn't general fund money,” Foster said. “The taxpayer is not paying one penny of this. It's all through promoter assessments and various revenue streams that the commission creates. This is not an assessment on taxpayers to pay for fighter's pensions.”
Discussions about extending a benefit to MMA fighters occurred in 2015 and 2019, and it looked on track prior to the pandemic.
Because legislative findings going back to 2006 did not include a pension program, many fighters in the busiest combat sports state in the country went without the same protection boxers had since 1982.
“I don't think the intention was to ever leave them out, but the practicality was they were left out and so now they have their own plan that's based very closely upon the same model as the boxer's pension program,” said Foster, calling it a “small oversight.”
“Now what can we do to fund this thing?” he wondered. “What can we create that will actually have long-lasting effects for the long-term benefits of these athletes?”
Lessons learned from the implementation of the boxing safety net, which faced criticism for failing to notify boxers with money coming to them, were considered during the legislative process around the MMA fund.
A report by the L.A. Times in May revealed that only 6% of the nearly 200 boxers, spouses or beneficiaries who qualified made a claim last year. Many did not know it existed.
In the wake of that reporting, Foster noted the commission embraced ideas to improve how they inform boxers around the world. They also updated contractual language to allow CSAC to mail yearly financial statements to fighters who vest.
“It goes both ways,” the executive officer said. “We're putting this in our license application so fighters know and are educated on retirement benefits, but they've got to let us know when they change addresses. We can't play a guessing game. If you move, you need to tell us so we have your address on file.”
After two seasons living on the outer edge of the San Francisco 49ers roster as an undrafted free agent and practice squad player, Hokit, a former fullback, heard talk from veteran players about the NFL's pension and 401ks.
Admittedly, he did not pay much attention “because you just think your career is going to last forever and that's not the reality of it,” Hokit said. “And so if you can jump on, planning out your future now, that's a key to success.
“It's cool that California is doing something about that.”
The size of the combat sports business in California is equivalent to Japan or the UK, Foster said, and last year featured more boxing than Nevada, New York, New Jersey and Texas combined.
The state is on track to regulate 150 professional MMA and boxing events in 2023 as it closes in on prepandemic levels.
Following a recent round of payouts, the boxing pension, which is funded by an 88-cent fee on event tickets (soon to be a dollar), stands at $4.8 million.
Had the MMA pension existed when California began regulating MMA in 2006, 168 fighters, including female pioneer Cris “Cyborg” Santos and veteran Henry Corrales, who both fight at Bellator 300, would be eligible for a onetime payment approaching $20,000 after they turn 50, or earlier than that through an educational or vocational benefit.
In theory, the fund, a bank account maintained by the Department of Consumer Affairs, could grow to the point that benefits get extended to the likes of Cyborg, the great Brazilian who fought 10 times in California, where she settled, or Corrales, a 37-year-old featherweight from La Mirada who came up through the area's regional circuit. With his three-rounder in San Diego against Kai Kamaka III, Corrales could vest twice over.
For Josh Hokit, it will take 13 fights in the state – fewer if he participates in five-round championship bouts – and waiting before the MMA pension will be worth thinking about beyond the bigger picture.
“If it continues to grow,” he said, “then for sure, sign me up to fight in California.”