New York State MMA Bill Highlights: Uncapped 8.5% Gate Tax, More

Posted on June 15, 2010


PREVIOUS POST: Full text of the Legislation

I’ve had a chance to read the proposed legislation that would legalize and regulate Mixed Martial Arts in New York State.

While most of the bill is what you would expect and nothing out of the ordinary as it pertains to the rules and regulations in most of the 31 States that already regulate MMA, there are some interesting items to note.

The big one, as mentioned earlier, is the 8.5% tax on the gross gate receipts in addition to the 3% tax on the gross broadcast receipts. Boxing events only pay 3% on each respectively with neither amount to exceed $50,000.

Interestingly enough, while the 3% on the gross from broadcast rights for MMA is capped at $50,00, the 8.5% tax on the gross box office receipts has no upper limit.

This is a huge discrepancy.

As an example, let’s use the gate for UFC 114 (headlined by Rashad Evans taking on Quinton “Rampage” Jackson). The event, which had an estimated live crowd of 15,000, pulled in $3.85 million at the gate. If an event of that magnitude were to take place in New York, the tax penalty incurred by the UFC would be in excess of $327,000. Meanwhile, a boxing event with a similar gate would only pay the maximum $50,000.

But it’s a fight for another day. First, we need to get this bill passed through the Assembly. Maybe after doing a couple events at MSG, the UFC can press the issue. It’d be in its best interests to do so not just financially, but also so they can have live events further up North to put some pressure on Ontario to legalize MMA.

Other Highlights

  • Legalizes MMA by adding the phrase “and professional combative sports” after mentions of “boxing.”
  • Establishes adoption of “the Unified rules of Mixed Martial Arts”
  • In addition to giving the State Athletic Commission sole jurisdiction over the licensing and regulation of MMA, also gives them jurisdiction over all MMA training facilities for professional or exhibition fighters .
  • Requires fighters to undergo a physical exam and neurological testing annually in order to be licensed. Costs for these examinations would be incurred by the State.
  • Requires fingerprinting for the purposes of a full background check with the Division of Criminal Justice Services in order to be a licensed participant or official. I know that Pennsylvania and Georgia have similar statues, though I’m not sure how many others do.
  • Prohibits anybody under the age of 16 from attending an event without the physical presence of a parent or guardian.

Annual Licensing Fees

  • Fighters: $50 (plus $20 temporary working permit for each fight)
  • Referees: $100
  • Judges: $100
  • Managers: $50
  • Chief Seconds: $40

Annual Promoter Fees

  • Seating capacity > 2,500: $500
  • 2,500 – 5,000: $1,000
  • 5,000 – 15,000: $1,500
  • 15,000 – 25,000: $2,500
  • 25,000+: $5,000

In addition to legalizing MMA, the bill also allows organizations that promote single discipline martial arts to have a process in which to be approved to hold bouts and exhibitions. Currently, New York State legislation limits the list specifically to the US Judo Association, US Judo Inc., US Tae Kwon Do Union, North American Sport Karate Association, USA Karate Foundation, US Karate Inc., World Karate Association, Professional Karate Association, Karate International, International Kenpo Association, and the World Wide Kenpo Association.

In other words, New York, get ready for some major Jiu-Jitsu competitions to hit a mid-size arena near you.