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Pro sports leagues, gambling interests pitch sports betting ideas

ALBANY – Through more than four hours of testimony during a legislative hearing Wednesday on how sports betting might work in New York State, stakeholders – from the NFL to upstate casinos to NHL players – all had their own ideas.

Pro sports leagues want only their data to be used when guiding how betting outcomes are determined. They also want to collect royalty payments.

Sports betting companies pitched a more relaxed model.

Pro athletes want protections for themselves and their families against what one representative called increasingly “aggressive” fans who angrily approach players after games to complain about how their performance made them lose wagers.

Off-track betting corporations and racetracks say they are being unfairly cut out of some plans to bring sports betting to the state.

Lawmakers predicted a state-sanctioned sports gambling program would eat into illegal, offshore sports companies operating in places like Romania, Costa Rica and Cyprus.

But all could agree on one thing: If sports betting does come to New York gamblers should be able to wager via their smartphones, laptops and other electronic devices.

Judging from the testimony by gambling and sports entities, the pinch-me excitement that New York even might permit online sports bets was palpable.

“The undeniable takeaway is that consumers expect and demand mobile sports betting. Where legal, regulated mobile betting is offered, they bring their dollars into lawful sportsbooks and state tax coffers. Where only retail is offered, those dollars remain in the entrenched, illegal and mobile market," Kip Levin, president of FanDuel, the fantasy sports company that also operates sports books in New Jersey, Pennsylvania and West Virginia.

Those concerned with New York’s sharp increase in gambling opportunities in recent years, however, sounded alarms to lawmakers about the need for adequate funding for treatment, increased gambling addiction problems and a “normalization” of gambling in the eyes of teens.

James Maney, head of a group that represents gambling treatment providers in the state, thanked lawmakers for letting him speak partly on behalf “of those who unfortunately will be casualties of the state’s expansion into mobile gambling."

The hearing in Albany, called by State Sen. Joseph Addabbo, a Queens Democrat who chairs the Senate Racing, Gaming and Wagering Committee, comes as some lawmakers are pushing a last-ditch effort to legalize internet sports wagering before lawmakers end their 2019 session on June 19.

Addabbo recently amended a sports betting bill to permit three upstate Indian tribes, including the Seneca Nation, to offer online sports wagering. Sports wagering is likely coming later this year to four upstate casinos, as well as Indian tribal casinos. But such bets would have to be made in person, and Gov. Andrew M. Cuomo has maintained that New York would have to amend its constitution to permit sports betting via mobile devices.

That, industry stakeholders said Wednesday, will be an expensive mistake. Chris Grove, an industry analyst with California-based Eilers & Krejcik Gaming, told lawmakers New York’s sports gambling market could total $1 billion in annual revenues in three to six years. But, he said, less than $50 million of that would be wagered in-person at casinos with the lion's share projected for online.

Online sports betting advocates employed similar arguments the gambling industry used in 2013 when the state legalized commercial casinos: that competition is all around the state and gamblers are going to take their money elsewhere.

At one point, lawmakers were shown real-time data on a screen depicting spots just over the New Jersey border from New York where Empire State bettors were signing in to make online sports bets. Estimates have varied, but Lindsay Slader, an executive with a company called GeoComply, estimated 8% of mobile sports betting accounts in New Jersey – which legalized sports betting last year – originated from a New York location.

A hearing room across the street from the Capitol attracted major gambling industry lobbyists, casino executives, sports betting operators and Native American casino interests, including the Seneca Nation. Pegula Sports and Entertainment, whose holdings include the Buffalo Bills and Sabres, this year hired a lobbyist to push its sports betting interests.

In the hearing room, some testified. Some just watched and listened.

Daniel Spillane of the NBA and Andy Levinson of the PGA urged lawmakers to require sports betting companies to use league statistics in determining betting outcomes and permit sports leagues to restrict the kinds of wagers allowed.

“The sports betting opportunities for New York are vast, but so are the risks," Levinson said of protections needed in any New York law to help ensure sports betting does not harm sports leagues’ integrity or fan confidence in the games and matches they are watching.

“We have nothing if our fans don’t believe our players are trying their very best," he said.

Pro sports leagues also want New York to impose a royalties fee with revenues going to the individual leagues; it would be the first such state to do so.

The NFL, in written testimony, agreed with the other pro leagues that only NFL data should be used by sports betting firms for gambling purposes. Further, it wants:

  • A specific ban on use of insider information, such as through a player or coach.
  • A minimum betting age of 21.
  • Prohibition against bets on individual player performance, such as how many passes a quarterback will complete in a game.

“Fans, players, coaches and personnel deserve to know that we are doing everything possible to ensure no improper influences affect how our games are played and that we are taking all appropriate steps to ensure that their participation in our games is not subjected to unfair and unwarranted allegations relating to sports gambling," the NFL said in its testimony submitted also with the Buffalo Bills, New York Giants and New York Jets.

Joseph Briggs, counsel with the NFL Players Association, spoke on behalf of players with the NFL, NHL, NBA, MLB and MLS. “Not a single person has said anything about the people that are actually being bet on," he said of pro athletes. “That’s a little concerning."

Briggs said players want lawmakers to engage in a comprehensive review of criminal codes so that fan dealings with athletes is made more clear when it comes to harassment. He said there have been increasing cases of fans approaching players "aggressively" about having lost bets because of a player’s performance. Sports betting has seemingly contributed to an “increase in anxiety” in some fan’s interactions with players, he said.

The hearing also heard from groups cut out of the possibility of offering sports betting. The charge was led by the state’s off-track betting corporations, which are owned by counties and cities across the state, and racetracks. They argued they will not only lose the opportunity to grow their beleaguered industry via sports betting but will see their fan base undercut by new ways to gamble online in the state.

David O’Rourke, president and CEO of the New York Racing Association, which runs three major thoroughbred tracks in the state, said cutting out tracks and the OTBs from expanded sports betting efforts “poses a direct threat to horse racing in New York State." He said racetracks won’t be able to compete with sports book operations that can offer dozens of different sports for wagering.

Stephen Shafer of the Coalition Against Sports Gambling in New York, called commercialized sports gambling “a form of financial fraud." Besides increasing gambling addiction problems, New Yorkers will face a surge of sports betting advertising; he cited a report that one in five ads during sports events in the United Kingdom are sports gambling-related.

“Commercialized sports betting will radically change the way children know and consume sports," he said.

Sports betting by smartphone? It could be coming soon to New York

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