New Scalping Law in NY
Posted: July 8, 2005 11:23 am
Saw this in today's newspaper:
http://www.nynewsday.com/news/printedit ... 6470.story
Will scalping law cut down ticket costs?
BY MONTY PHAN
STAFF WRITER
July 8, 2005
The governor calls it a safeguard. Critics call it a cop-out.
But however one views it, the state now has one of the country's more unique laws governing ticket scalping - one that accounts for the difference between intimate Broadway theaters and spacious sports stadiums.
The bill to loosen restrictions on hefty markups by ticket brokers was signed by Gov. George Pataki last week.
The State Legislature actually had passed a bill last month that would have eliminated all price restrictions on the resale of tickets at venues with 6,000 or more seats, but Pataki objected to the lack of price controls and threatened to veto it.
On June 14, he agreed to a compromise that would cap the resale of tickets at 45 percent. That bill was then passed and signed by the governor last week. The law would close a loophole brokers had used to skirt current restrictions, which allow for the resale of tickets at markups of $5 or 20 percent above face value, whichever is greater. Brokers got around that by tacking on service and delivery fees. Now, those fees are included under the 45-percent cap.
The new rules apply at venues with 6,000 seats or more; at smaller arenas and theaters, current restrictions still apply. But Stephen Happel, an Arizona State University professor who has testified on the subject of ticket resales, said the price restriction is "beyond stupid."
One theory, he says, is that price caps could lead to higher prices. Consider if resellers get 60 percent above face value for tickets. In states that make such markups illegal, law-abiding resellers won't offer the tickets, but the less scrupulous will find other methods. The result: Supply is restricted, demand remains the same, so prices go up.
"It will not protect them from exorbitant prices," Happel said. "People will still pay exorbitant prices. They'll just do it underground.
But do people need protection from ticket scalping? "These are games, concerts," Happel said. "We're not talking about kidney transplants."
Kevin Quinn, a Pataki spokesman, said the cap could aid enforcement by clarifying what the lawful costs are above a ticket's face value. Under the new law, brokers would have to pay a $5,000 licensing fee to resell tickets.
Russ Haven of the New York Public Interest Research Group, said the idea of closing the price loophole may help protect consumers. "I do think it certainly sounds like the governor has improved what had been an awful deal for consumers" under the original proposal, Haven said.
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I don't know if this applies to the Tix Exchange here, but better to be safe than sorry
http://www.nynewsday.com/news/printedit ... 6470.story
Will scalping law cut down ticket costs?
BY MONTY PHAN
STAFF WRITER
July 8, 2005
The governor calls it a safeguard. Critics call it a cop-out.
But however one views it, the state now has one of the country's more unique laws governing ticket scalping - one that accounts for the difference between intimate Broadway theaters and spacious sports stadiums.
The bill to loosen restrictions on hefty markups by ticket brokers was signed by Gov. George Pataki last week.
The State Legislature actually had passed a bill last month that would have eliminated all price restrictions on the resale of tickets at venues with 6,000 or more seats, but Pataki objected to the lack of price controls and threatened to veto it.
On June 14, he agreed to a compromise that would cap the resale of tickets at 45 percent. That bill was then passed and signed by the governor last week. The law would close a loophole brokers had used to skirt current restrictions, which allow for the resale of tickets at markups of $5 or 20 percent above face value, whichever is greater. Brokers got around that by tacking on service and delivery fees. Now, those fees are included under the 45-percent cap.
The new rules apply at venues with 6,000 seats or more; at smaller arenas and theaters, current restrictions still apply. But Stephen Happel, an Arizona State University professor who has testified on the subject of ticket resales, said the price restriction is "beyond stupid."
One theory, he says, is that price caps could lead to higher prices. Consider if resellers get 60 percent above face value for tickets. In states that make such markups illegal, law-abiding resellers won't offer the tickets, but the less scrupulous will find other methods. The result: Supply is restricted, demand remains the same, so prices go up.
"It will not protect them from exorbitant prices," Happel said. "People will still pay exorbitant prices. They'll just do it underground.
But do people need protection from ticket scalping? "These are games, concerts," Happel said. "We're not talking about kidney transplants."
Kevin Quinn, a Pataki spokesman, said the cap could aid enforcement by clarifying what the lawful costs are above a ticket's face value. Under the new law, brokers would have to pay a $5,000 licensing fee to resell tickets.
Russ Haven of the New York Public Interest Research Group, said the idea of closing the price loophole may help protect consumers. "I do think it certainly sounds like the governor has improved what had been an awful deal for consumers" under the original proposal, Haven said.
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I don't know if this applies to the Tix Exchange here, but better to be safe than sorry