Integrity Fee Legislation

The **Integrity Fee** was a controversial legislative proposal introduced by the NBA and MLB immediately following the 2018 repeal of PASPA. The leagues demanded a statutory fee of **1% of total betting handle** (later reduced to 0.25%) from sportsbook operators to cover the costs of monitoring match-fixing and to compensate for the use of their intellectual property. **Key Developments:** * **Economic Clash:** Operators argued that 1% of handle equated to ~20% of revenue, rendering legal markets uncompetitive against offshore books. * **Legislative Failure:** Most states rejected the direct fee, viewing it as a private tax on a regulated industry. * **The Data Pivot:** Failing to secure a direct tax, leagues successfully lobbied states like Tennessee and Illinois to mandate the use of **Official League Data** for in-play betting. Ultimately, the statutory integrity fee evolved into a commercial **Data Rights Model**, where leagues monetize betting through high-cost, low-latency data feeds required for live wagering.