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Self-financing is accelerating manipulation & political pressure on Nevada’s athletic commission

By Zach Arnold | August 18, 2017

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The Nevada State Athletic Commission has always been surrounded by turmoil but managed to skate through various public relations crises. That changed when Keith Kizer took over as Executive Director. All hell broke loose with every possible faction fighting each other in a massive political tug-of-war. The turmoil blew up in everyone’s face, especially UFC’s, after the testosterone hall pass era for fighters claiming they needed the base chemical of anabolic steroids in order to function as fighters.

The political wars and legal fights took their toll. Nevada has & will continue to face difficult budgetary decisions. Power brokers on the Athletic Commission, including Keith Kizer, found exit strategies. Without warning, Nevada politicians decided to untether the Athletic Commission from the state’s general fund. Years of legal charges from the Attorney General’s office were dump-trucked on the AC as Carson City said, “you’re on your own.”

The financial changes were dramatic. No more financial support from the state. The Nevada State Athletic Commission would have to finance its own operations the same way every other major Athletic Commission in America does. The price of doing business changed as well: an increase of the gate tax on events to 8% in exchange for no television or PPV tax money. This change happened right when the Nevada State Athletic Commission expanded “enhanced” drug testing. USADA’s agreement with UFC quickly followed.

The initial spin from the Athletic Commission? Self-financing is wonderful! We’re making lots of money! Our budget is only $550,000 a year. We’re not California, where you can make $1.59M in yearly revenue but still manage to lose $50,000 in a year.

Here’s the catch:

The Nevada State Athletic Commission gets 25% of the money from the 8% gate tax. The state of Nevada gets 75%. Most Nevada events are sold shows with casinos so everyone knows ahead of time what the finances are. Hypothetically speaking, though, if the Mayweather/McGregor fight was not a sold show and had a gate of $60 million dollars, the Athletic Commission would get $1.2M and Nevada’s general fund would get $3.6M.

The new system creates automatic political pliability and changes everything.

If you want bigger fights, you’re facing pressure to give in to shenanigans like Conor McGregor and Floyd Mayweather wanting 8 ounce gloves instead of 10 ounce gloves. The bigger the fight, the more intense the pressure to bend the rules. The major athletic commissions are increasingly hostile to club-sized and mid-arena events. The administrative costs make those events difficult to squeeze cash from if you don’t have a TV or PPV tax mechanism. Nobody hosts more shows in a year than California and Texas and California lost money in Fiscal Year 2016-2017. This is why Athletic Commissions don’t mind outsourcing & delegating regulatory authority to third-party entities.

The price tag of self-financing for athletic commissions is increased political manipulation and inevitable corruption. It accelerates both factors, regardless as to the quality of character of the administrators involved.

Nevada has built-in economic advantages that no other state has. It’s a two city state for shows. Administrative costs are low. Not much travel. No state income tax. Las Vegas is king. There shouldn’t have been financial problems for the Athletic Commission to begin with. The state should have never spliced the Athletic Commission away from general funding.

Detaching a municipal/government agency from general funding can have severe consequences on ethical behavior. It is a major factor in the ongoing debate over American asset forfeiture laws. If state agencies can keep a significant percentage of assets they confiscate from individuals through criminal or civil asset forfeiture, it increases incentives to police for profit. Social responsibility flies out the window.

On Thursday, UFC broadcaster Fox Sports 1 spent the day defending Nevada’s decision to allow Conor McGregor & Floyd Mayweather to use 8 ounce gloves instead of 10 ounce gloves. The most vocal defender was Colin Cowherd, who raised the cynical affirmative defense that you shouldn’t expect as much integrity from low-regulation locales like Nevada, Texas, or New Orleans. Cowherd specifically targeted his response to Kevin Iole’s criticisms of the Nevada State Athletic Commission as a for-profit enterprise and agreed with the column’s assertions.

Cowherd’s affirmative defense for the Nevada State Athletic Commission’s behavior amounts to mootness.

“I’m not bothered by any of it. Boxing began with no gloves and unlimited rounds. Then they shifted to gloves and limited rounds. Was a study ever done to change those moves? Nope. Then they went from 12 rounds and it was reduced to 10. Did a doctor or a study determine that 12 rounds equaled instant death? 10 rounds is living well into your 90s. No study done. By the way, 10 ounce gloves are used at 154 pounds in boxing in Nevada. At 147, you can use 8 ounce gloves. Was a study done on that? No.

“My point is, boxing has been making it up on their own forever. Can you imagine NASCAR saying, the speed limit is now at 184 mph. 188… you’re in peril. 184, it is smooth sailing. You could drive to the grocery store at that speed.

“That’s what this sounds like to me. The gloves now are the issue. Now think about this. The gloves now are the issue. The Nevada athletic commission OK’d a fight between the world’s best pound-for-pound fighter and a man who’s never boxed and I’m worried about something the weight of a slice of bread? This is like complaining that the mob is upcharging on a garbage pick-up as they whack seven guys down the block on the pier. This is calling up the Nevada athletic commission and saying, “I just saw a bunch of mob guys take out baseball bats and whack people over the head, may have killed them, and drive off.” And Nevada athletic commission saying, “you know, that’s fun, but what really bothers us is that the mob guys weren’t wearing seat belts.”

“They sanctioned this fight! Between the world’s best fighter and a guy who hasn’t boxed. The gloves thing is a slice of bread. Even when the gloves, wear then here, not wear them there. 12 to 10 rounds. Studies done on any of this stuff? The people who get hurt in boxing know they’re boxing. This has been a sport with very little unification, commission to commission, state to state, weight class to weight class. Once you sanctioned this fight, it was a circus and both adult participants signed off on the circus.”

Cowherd would go on to later compare the Nevada State Athletic Commission as a low-regulation locale with similar integrity to a New Orleans tourism board member getting bribed and someone getting drugs from “Rock Star Pharmacy.”

The irony of all ironies is that Andy Foster, who lost the Nevada State Athletic Commission Executive Director job to Bob Bennett, was the first athletic commission to grant Conor McGregor a boxing license. That gave Bennett and Nevada some political cover, along with the Nate Diaz UFC 202 fight, to sanction next week’s circus.

When athletic commissions are forced to to self-finance, they bend over in big ways. Nevada has joined the club.

Topics: Boxing, CSAC, Media, UFC, Zach Arnold | 1 Comment » | Permalink | Trackback |

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