What are Integrity Fees in Sports Betting?
When the U.S. Supreme Court struck down PASPA in 2018, professional leagues immediately pushed for a cut of the action—coining the term “integrity fee.” Marketed as funding to monitor and protect game integrity, the proposal sparked fierce debate among legislators, sportsbooks, and bettors. This guide explains what an integrity fee is, the history behind it, arguments for and against, and the potential impact on odds and consumer wallets.
What Is an Integrity Fee?
- Definition: A percentage of sportsbook handle (total amount wagered) paid to sports leagues for integrity‑monitoring programs.
- Typical Ask: Early lobbying sought 1 % of handle—roughly 15–20 % of gross gaming revenue (GGR) once hold is considered.
- Purpose (per leagues): Fund advanced data analytics, officiating reviews, and betting‑pattern monitoring to detect match fixing.
Timeline of the Integrity Fee Debate
| Year | Milestone |
|---|---|
| 2018 | NBA & MLB lobby Indiana and New York for a 1 % integrity fee in early draft bills. |
| 2019 | Kansas Senate includes 0.25 % fee; removed after pushback from operators. |
| 2020‑2022 | Most new state bills omit integrity fees, opting for official league data mandates instead. |
| 2023‑2024 | Debate shifts to revenue‑share partnerships (e.g., Genius Sports & NFL) rather than statutory fees. |
How Integrity Fees Would Affect Odds
Sportsbooks operate on razor‑thin margins (average hold 5‑7 %). A 1 % handle fee equates to roughly 20 % of GGR, forcing operators to:
- Increase hold via worse odds (e.g., move –110 spreads to –115).
- Raise vig on moneylines and totals.
- Cut promotional offers and sign‑up bonuses.
Net effect: bettors pay the fee indirectly through diminished value.
Arguments For an Integrity Fee
- Enhanced Monitoring: Leagues bear cost of data scientists, betting monitors, and enforcement partnerships.
- Incentive Alignment: Direct revenue gives leagues financial stake in a healthy betting ecosystem.
- Historical Precedent: European model allows sports governing bodies to collect fees or taxes from betting operators.
Arguments Against an Integrity Fee
- Double Dipping: Leagues already sell official data feeds and sponsorships to sportsbooks for millions.
- Regulator Role: Integrity and match‑fixing enforcement traditionally fall under state gaming commissions, not leagues.
- Consumer Cost: Added fees trickle down to bettors via higher vig and reduced promotions.
- Market Competitiveness: Extra costs may push bettors back to offshore books with better lines.
Current Alternatives to Integrity Fees
- Official League Data Mandates: Many states require books to purchase league‑licensed in‑play data—generating revenue without statutory handle taxes.
- Information‑Sharing Agreements: Operators flag suspicious wagers to leagues and regulators in real time.
- Independent Monitoring Services: Companies like Sportradar and Genius Sports provide integrity audits funded by sportsbook subscriptions.
Impact on State Tax Revenue
State betting tax rates already range from 6.75 % (Nevada retail) to 51 % (New York online). Layering a handle‑based integrity fee could:
- Reduce operator profitability, potentially discouraging market entry.
- Lower taxable GGR—as books widen margins, turnover may decline.
- Complicate revenue projections for state budgets tied to betting growth.
International Perspective
- Australia: “Product fee” paid by bookmakers to racing bodies—tiered on turnover and fixed odds—funds integrity services.
- France: Betting operators pay levies to sports federations (e.g., tennis) earmarked for anti‑corruption efforts.
- United Kingdom: The Horse‑race Betting Levy supports racing integrity; no blanket fee for other sports.
Frequently Asked Questions
Do any U.S. states currently impose an integrity fee?
No. As of 2025, no state statute includes a handle‑based integrity fee. Discussions shifted toward official data agreements instead.
Could federal legislation mandate a fee?
Unlikely in the near term; sports betting remains regulated at the state level. Federal bills introduced since 2018 have not advanced.
How big is the integrity monitoring budget for major leagues?
Exact figures are private, but multi‑year data partnerships with firms like Sportradar and Genius Sports exceed $100 million annually across major leagues.
Would bettors see integrity fee charges on tickets?
No. Fees would be baked into the odds—higher vig or less favorable lines—rather than itemized on bet slips.
Key Takeaways
- Integrity fees aim to give leagues a direct slice of betting handle to fund anti‑corruption efforts.
- Books would likely pass costs to bettors through worse odds and reduced promotions.
- No U.S. state has adopted a statutory integrity fee; instead, leagues monetize data sales and private partnerships.
- Regulators, operators, and leagues now favor information‑sharing protocols over mandated handle levies.
- Understanding the economics behind integrity fees helps bettors and policymakers evaluate future proposals that affect market pricing.
