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By Alex Ebert
Two squads of pro-sports lobbyists have registered in Kentucky, signaling an attempt to influence whether lawmakers put an integrity fee into sports betting bills.
The state’s only pre-filed bill doesn’t include an integrity fee, which is a portion of revenue or wagers that would go directly to professional sports leagues. However, July and August registration documents by 14 lobbyists for pro leagues imply the leagues intend to discuss the issue with lawmakers.
A group of four lobbyists for the National Football League disclosed that they’d be engaged in lobbying on “any issues related to professional athletics, sports wagering, taxation, or sports game integrity.” Nearby Cincinnati, Ohio, and Nashville, Tenn., have teams, but Kentucky doesn’t have an NFL squad.
Likewise, a group of 10 lobbyists for Major League Baseball disclosed that they would engage in lobbying on “any issue relating to professional sports, sport integrity, sports wagering, taxation, or business development.” Lobbyists from the National Basketball Association and the Professional Golfers Association are also setting up shop in the state. However, there is no MLB or NBA franchise in Kentucky.
The lobbyists didn’t immediately return requests for comment about what level of fee they’d be seeking, and how they would influence legislators in a state with no league franchise.
Leagues have said the fees are necessary to compensate them for enforcing internal policies that bolster the integrity of their sports as well as prevent and root out gambling corruption. So far, an integrity fee hasn’t been passed into law in any state with sports gambling.
Kentucky needs to jump into the sports betting market quickly if it wants to compete with neighboring West Virginia and other states launching platforms for the emerging market, Jennifer Hays, a tax expert in the nonpartisan Kentucky Legislative Research Commission, said in Aug. 30 testimony before a joint interim committee on tax issues.
A nine-member bipartisan group of Kentucky legislators is leading an effort to regulate and tax sports betting in the Bluegrass state. They hope to receive between $5.5 and $26 million annually on professional, and some collegiate, sports bets.
However, big questions—like the integrity fee issue—remain, Hays said. She recently attended a conference where lawmakers were considering a quarter-of-one-percent integrity fee.
Several politicians on the bipartisan committee seemed hesitant to move ahead with sports wagering.
Hays said that revenue projections would be “difficult” because data isn’t available to create a fiscal note. She said there’s no way for the state to know how many Kentuckians are gambling on sports illegally.
Rep. Ken Fleming (R) said the state needs to know it can “break even” if it is going to create the licensing and administrative framework necessary to allow gaming in Kentucky. “There’s got to be a good threshold to do that.”
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