MLB, NBA ready to bet on sports wagering in Connecticut

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Hartford — If Connecticut and other states legalize sports betting, Major League Baseball and the National Basketball Association are perfectly willing to go along — for a price.

And that price would be 1 percent of the “handle,” the total amount wagered on everything from the outcomes of games to whether the Yankees’ Aaron Judge strikes out the next time he comes to bat.

It’s a take estimated at as much as $200 billion.

One percent of that, or $2 billion, the leagues say, would pay for the costs incurred in policing the betting, certifying the records used in determining outcomes and shouldering the risks associated with an endeavor that tends to be vulnerable to scandal. If something goes wrong, it can tarnish a league’s image.

The 1 percent’s come to be known as the “integrity tax.” It’s also been called a “royalty.”

“That’s the issue of the day,” state Rep. Joe Verrengia, D-West Hartford, said Thursday, after the legislature’s Public Safety and Security Committee, which he co-chairs, hosted an hourslong informational hearing on trends in gambling. “I’m all for an integrity fee so long as it goes toward ensuring integrity. I’d be against legislation that would line the pockets of major league sports owners. ... There’s tremendous value in legalizing sports betting.”

Estimates of that value vary widely.

Speakers at Thursday’s hearing suggested Connecticut could expect about $2 billion a year in wagers if it were to legalize betting on professional games. That would yield taxable revenue of about $100 million after winnings were paid out. Gaming industry representatives testified that a tax rate of from 6 to 9 percent is reasonable in the case of sports betting, meaning Connecticut would stand to collect less than $10 million a year in sports betting tax revenue.

Projections involving higher tax rates and annual tax revenues in the tens of millions of dollars annually have been floated.

Democratic members of the state House of Representatives have said they’re preparing to introduce sports-betting legislation by the end of the current legislative session, provided the U.S. Supreme Court strikes down the Professional and Amateur Sports Protection Act of 1992, a law that effectively bans sports betting in all but Nevada and three other states. Justices have heard arguments in the state of New Jersey’s challenge of the law and are expected to rule within months.

Anticipating a lifting of the ban, a number of states, including Massachusetts, New York and Rhode Island, have drafted legislation that, if approved, would enable them to introduce sports betting without delay once the Supreme Court acts.

In her budget proposal for fiscal year 2019, Rhode Island Gov. Gina Raimondo included $23.5 million in revenue from sports betting. A bill introduced in the Rhode Island Senate would authorize sports betting at Twin River Casino in Lincoln and at the new Twin River-Tiverton casino scheduled to open in October.

Dan Spillane, an NBA executive, told committee members that the league’s longtime opposition to sports betting has changed in recent years as the public’s acceptance of gambling in general has increased. He said hundreds of billions of dollars are now wagered illegally on sports. Recently, the league has joined forces with Major League Baseball to develop a framework for legislation.

Bryan Seeley, an MLB executive, said the leagues would prefer that sports betting were regulated nationally rather than on a state-by-state basis.

In Connecticut, any sports-betting legislation would be expected to spell out where and on what platforms the activity could take place. Both the Mashantucket Pequot and Mohegan tribes have indicated they’d be eager to provide sports betting at their respective casinos, Foxwoods and Mohegan Sun. Connecticut Lottery Corp. locations and off-track-betting facilities also are possibilities.

Dan Shapiro, a representative of William Hill Sports Book, a London-based company that operates the sports-betting operations at 108 Nevada casinos, said most of the wagering takes place on mobile applications. He said bettors must visit a casino to establish an account and then can bet online anywhere in the state.

Special “geo-location” technology ensures that betters cannot wager from outside Nevada’s borders.

b.hallenbeck@theday.com

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