Colleges Continue to Explore Options for Cashing in on Sports Betting

By Rick Rockwell in Sports & Betting on August 26, 2018

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Minute Read

Post-secondary schools in states where legal sports betting has started, or soon will, are looking to join pro sports leagues in the push for legislation requiring sportsbooks operators to pay them a portion of the amount wagered on their games. Because colleges are worried that sports betting will cause more costs to ensure their games are on the straight and narrow, this is a way for schools to cash in on the profits.

Since the United States Supreme Court decided in May to overturn the federal ban on sports betting outside of Nevada, sportsbooks have popped up in New Jersey, Delaware, and Mississippi, with another one planned in West Virginia. Other states are also getting closer to legalization, with legislation already being pursued to regulate sports betting.

For those states where legal sports betting has already started or is in the process of starting, schools are considering joining forces with professional sports leagues in asking for integrity fees that would pay them a portion of the amount wagered on their games. Officials at those colleges say that the integrity fees would aid in funding programs that will educate athletes about game fixing or point shaving, and would help the colleges to monitor betting odds for unscrupulous activities associated with sports gambling.

Opposition to Integrity Fees

The American Gaming Association, an organization that lobbies for the gambling industry, is against integrity fees, which would be in addition to federal and state taxes that already reduce profit margins. In addition, the pressure may cause operators to offer less attractive odds that someone could get by going to an illegal bookie.

Only about five percent of the total wagers is kept by legal sportsbooks, and the desired integrity fee is one percent. For the math majors out there, that’s roughly 20 percent of the sportsbooks’ profit going to whoever gets the integrity fees. In an interview with the Daily Democrat, Sara Slane, the AGA’s senior VP of Public Affairs, made the following comments about the idea of integrity fees:

“It’s absolutely absurd. There is no business that would agree to that. It’s not going to accomplish ultimately what I think the leagues would like to see, even the colleges would like to see, which is to have regulated, legalized sports betting and consumers partaking in that platform versus continuing down the path of the illegal market.”

How Much Could Schools Get?

There’s no way to determine the amount of revenue that integrity fees may bring into any individual school, which would only receive the fees based on the total wagers legally placed on the school’s athletic events. Andy Humes, the executive associate athletic director for complaining and administration at Missouri, speculates that it’s not going to be millions of dollars.

Professional Leagues Want Fees Too

Professional sports leagues have been beating the drums on integrity fees because they believe that sportsbooks are making their money off of the leagues’ product, and with the increase in betting opportunities, the professional leagues will have to funnel more money into monitoring betting odds for any potential cheating.

In New York, the NBA and MLB led a bill that would secure them a one percent integrity fee, which they ended up reducing to one-quarter of one percent, but the bill didn’t get to the legislature’s floor before the session finished back in June.

Mississippi and Integrity Fees

Mississippi casinos started offering sports betting earlier in August, and school officials there have recently gathered to discuss if they want to go after integrity fees. Mississippi State athletic director John Cohen said the legalization of sports betting in the state will cost the athletic department for education and staffing, and the responsibility isn’t something they’re taking lightly.

The athletic director of Ole Miss, Ross Bjork, indicated that integrity fees would help pay for compliance and the education of athletes so they would know that any talk about making money off betting would be a “losing conversation.”

West Virginia’s Battle with Integrity Fees

At a meeting in May where integrity fees were addressed at a state level, Marshall’s athletic director Mike Hamrick and WVU’s athletic director Shane Lyons both attended and declared that they want the schools’ expenses for extra monitoring and education of athletes to be offset with integrity fees.

Hamrick, referring to point-shaving scandals from other schools in the past, said: “I think at some point, someone has to say we’ve got to help the two universities in this state to make sure they don’t become another Boston College or Northwestern.”

He went on to say if colleges do end up getting integrity fees, he’d be able to hire more compliance staffers right away, and he would bring in guest speakers to educate the players. “The pros that come in, they’re expensive. You could go as far as working with the university to maybe have a class that the kids have to take on a regular basis.”

Hamrick is familiar with the casino industry; he was UNLV’s athletic director for six years before he came to Marshall, and said there was a sportsbook operation across the street from the school’s football practice location.

As for making sure everything was on the up-and-up, at UNLV, a compliance officer from the school would watch to see if anyone would approach football players after any games. Additionally, players who drove on campus had to register their plates with the school so the university’s athletic department would who the cars belong toe. Hamrick said maybe that was overdoing it, but he wanted to make sure no one could get to any of the athletes.

Lyons said there wasn’t a lot of consultation with Marshall and WVU when the West Virginia legislature passed the sports betting bill this year, and he knows it’s his job to protect the sports department’s integrity. “The last thing I want is for one of my athletes to be involved in any type of issue with sports betting.”

Although WVU and Marshall were unsuccessful in their attempts to get integrity fees in the state’s sports betting regulations, both universities aren’t ready to give up on this fight. On Thursday, August 24th, Hamrick talked to Board of Governors for Marshall and belabored his point how the university needs to be on top of things regarding sports betting:

“This is something as a university we need to be on top of every day. One point-shaving incident, one student-athlete betting on a game, one coach, one staff member, one board of governor – something goes wrong, it could do great harm to our university.”

Who Should be Responsible for Protecting College Sports?

West Virginia and Mississippi aren’t the only two states dealing with concerns over protecting their collegiate athletic events. This concern has spread throughout the nation with collegiate institutions publicly expressing concern.

College football is one of the most popular sports with bettors and it’s also the biggest moneymaker for most universities. So, it’s not a surprise that coaches, AD’s and commissioners are speaking out on sports betting. In a CBS Sports report, the three most prominent football conferences are in unisons when it comes to their concerns over the integrity of the game:

“We need to continue to educate [players] about the challenges associated with gambling and the importance of the integrity of the game.” — Jim Delany, Big Ten commissioner

“For us, the integrity of our games is of the utmost importance.” — Greg Sankey, SEC commissioner

“I think the ultimate question with us is how do you protect the players and the integrity of the game?” — John Swofford, ACC commissioner

With that in mind, who should be responsible for protecting the schools and their sports? Anthony Cabot, who is a gambling industry lawyer, said that the NCAA, and not schools, should be the ones responsible for making sure that sports stayed above-board by creating a division that would work exclusively with sportsbook operators to watch for any irregular gambling patterns.

He explained that the NCAA wouldn’t know what was going on when it came to the integrity of the games if it didn’t undertake an overarching integrity program on its own. “We really do need a national system to protect the integrity of the games, and how much a single university could contribute to that is somewhat limited.”

Rick Rockwell

As a longtime freelance writer, avid sports fan, former athlete, and experienced sports bettor, Rick Rockwell has risen up the ranks at GamblingSites.org to become the self-professed "King of the Blog" in his first year with the site.

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