DC committee cuts proposed ‘royalty fee’ from sports betting bill

During a hearing held on Wednesday, the District of Columbia’s Committee on Finance and Revenue verbally rejected the inclusion of a ‘royalty fee’ in an active sports betting bill.

The sports betting bill titled the sports lottery wagering amendment act was introduced back in September by Chairman Jack Evans. Evans is also responsible for the amending the bill to include ‘royalty fees.’

The proposed amendment came to light earlier this week and defined a royalty fee as: “a fee of one-quarter of one percent (0.25%) of the gross sports wagering revenue (as defined in (3) above) on sporting events conducted by registered sports governing bodies.”

In exchange for paying the leagues a royalty fee, the leagues would have been entitled to use official league data.

The ‘royalty fee’ was first introduced in a New York sports betting bill and stipulated that sports betting operators would pay a ‘royalty’ to the sports leagues for using the leagues’ games.

In recent weeks, several of the major sports leagues have made several partnerships with sports betting operators to share official league data.

If the leagues were to get their way and receive ‘royalty fees’ while forming sports betting partnerships at the same time, it would essentially allow them to benefit from two revenue streams.

Official league data and statistics are used to formulate betting odds for sportsbooks.

Despite the rejection of a ‘royalty fee’ the bill will move forward for a first reading on 4 December. From here the bill could be voted on at a meeting on 16 December.

If the bill is passed in its current state, four professional sports venues in the state will be able to offer sports betting.

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