Jake Encarnacao of Sherdog.com reports that New York Governor David Paterson has unveiled his state budget proposal for the up-coming fiscal calendar and it includes a bill that would effectively re-instate MMA in New York.
Governor David Paterson unveiled a state budget proposal Tuesday that includes a bill that would nullify a 13-year-old ban on MMA in the Empire State as a way of raising sorely needed revenue.
“Currently, 40 States safely regulate the sport of mixed martial arts and enjoy local and statewide economic benefits associated with the conduct of mixed martial arts events,” reads a summary from Paterson’s office of his revenue proposals. “While New York’s ban on professional combative sports would be removed, conduct of the sport would be carefully regulated.”
Paterson’s proposal means that legalization of MMA will be taken up as part of the annual state budget process, which has to be completed by April 1. The timeline is much stricter than it would be if an individual legislator proposed it.
If the Assembly passes the bill by April 1, Marc Ratner, the UFC’s Vice President of Regulatory Affairs, said that it could take five to six months for the New York State Athletic Commission to get up to speed and the earliest a MMA event could be held in New York would be fourth quarter of this year.
A budget summary from the governor’s office estimates that legalizing MMA will put $2.1 million in the state’s coffers in the 2010-11 fiscal year, which runs from April 1, 2010 to March 31, 2011. New York is facing an estimated $7.5 billion budget deficit. Paterson’s legislation proposes an 8.5 percent gate tax on MMA events, one of the highest in states where the sport is regulated. The bill that passed in neighboring Massachusetts last month imposes a 4 percent gate tax, as does Nevada. New York’s gate tax for boxing events is 3 percent. UFC brass scoffed at an earlier New York proposal that called for a 10 percent gate tax.
The Assembly still has to debate the bill and vote to approve it. Only one member of the 150-member Assembly, Bob Reilly of the state’s 109th district, has been outspoken in his intent to vote against MMA legalization. Reilly’s disapproval stalled progress of the bill in an Assembly committee two years ago; last year the bill didn’t get to a vote because of a political stalemate unrelated to MMA.
Payout Perspective:
The gate tax is really quite high, which suggests this push to legalize the sport is more of a money grab than a recognition of MMA’s legitimacy. Moreover, the difference in tax levels between New York and neighboring states may provide smaller promoters – those which do not benefit from the status appeal of hosting a show in the Big Apple, for example – with the incentive to take their shows to states like Massachusetts, New Jersey, Pennsylvania, or even Rhode Island.
Obviously, the UFC is going to lobby to get that tax rate reduced, but if it goes unchanged it’s likely something they’ll be able to live with because it’s New York – the sporting mecca of the fight world and the most powerful media hub in the United States. Putting on a show at MSG not only symbolizes how far MMA has come, but it also amplifies the size of the event by virtue of that media coverage and “big stage” atmosphere.
Note: There are a lot of things that still need to fall into place. Often times, as we’ve seen in the past, those things do not fall in a timely fashion, so no need to start planning NYE in NY just yet.
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