A performance audit of the Athletic Commission

              STATE OF ARIZONA
OFFICE OF THE
AUDITOR GENERAL
A PERFORMANCE AUDIT
OF THE
ATHLETIC COMMISSION
DECEMBER 1981
A REPORT TO THE
ARIZONA STATE LEGISLATURE
REPORT 81 - 20
DOUGLAS R NORTON. CPA
AUDITOR GENERAL
STATE OF ARIZONA
OFFICE OF THE
AUDITOR GENERAL
December 23, 1981
Members of the Arizona Legislature
The Honorable Bruce Babbitt, Governor
M r . Gerald Maltz, Chairman
Athletic Commission
Transmitted herewith is a report of the Auditor General, A Performance
Audit of the Athletic Commission. This report is i n response to a
January 30, 1980, resolution of t h e J o i n t Legislative Oversight
Committee. The performance audit was conducted a s a part of the Sunset
review s e t f o r t h i n A. R. S. § § 41- 2351 through 41- 2379.
The blue pages present a summary of the report; a response from the
Chairman, M r . Gerald Maltz is found on the yellow pages preceding the
appendices.
My s t a f f and I w i l l be pleased t o discuss o r c l a r i f y items i n the report.
Respectfully submitted,
Ilougl$ R. Norton
Auditor General
Staff: Gerald A. Silva
William Thomson
Robert Back
Richard Booth
Samuel L. Harris
William A. Wright
Enclosure
1 1 1 WEST MONROE SUITE 600 PHOENIX. ARIZONA 85003 ( 602) 255- 4385
O F F I C E O F THE AUDITOR GENERAL
A PERFORMANCE AUDIT OF THE
ATHLETIC COMMISSION
A REPORT TO THE
ARIZONA STATE LEGISLATURE
REPORT 81- 20
TABLE OF CONTENTS
SUMMARY
INTRODUCTION AND BACKGROUND
SUNSET FACTORS
FINDINGS
FINDING I
The Athletic Commission has not f u l f i l l e d its
r e s p o n s i b i l i t y t o ensure t h a t p a r t i c i p a n t s i n
professional boxing comply with s t a t u t o r y
requirements. A s a r e s u l t , some unlicensed
individuals have participated i n professional
boxing and promoters have not paid the two percent
g a t e t a x i n compliance with the s t a t u t e s .
CONCLUSIONS
RECOMMENDATIONS
FINDING I1
Changes are needed t o improve the regulation of
boxing and b e t t e r p r o t e c t p a r t i c i p a n t s from
physical harm.
CONCLUSION
RECOMMENDATIONS
FINDING I11
The Athletic Commission has not complied with
a l l s t a t u t o r y requirements dealing with professional
wrestling. However, the r e s u l t s of these non- compliances
do not threaten the health, safety and welfare of the
public or p a r t i c i p a n t s . F u r t h e r , deregulation of
professional wrestling could occur without endangering
t h e h e a l t h and safety of the public or participants.
Page
i
1
3
CONCLUSION
RECOMMENDATION
- Page
FINDING IV
The Commission has not complied with A. R. S. $ 5- 224.~
regarding the frequency of meetings. Commissioners
and the Commission's executive secretary have not
been paid all of the per diem and compensation to
which they are entitled.
CONCLUSION
RECOMMENDATION
WRITTEN RESPONSE TO THE AUDITOR GENERAL REPORT
Table I
LIST OF TABLES
- Page
2
Summary of Commission expenditures f o r f i s c a l years
1977- 78 through 1980- 81 and the appropriation for
f i s c a l year 1981- 82.
TABLE I1
Summary of each s t a t e ' s tax on receipts from professional
boxing and wrestling.
SUMMARY
The Office of the Auditor General has conducted a performance audit of the
Athletic Commission i n response t o a January- 30, 1980, resolution of the
Joint Legislative Oversight Committee. This performance audit was
conducted as a part of the Sunset Review s e t f o r t h i n Arizona Revised
Statutes ( A. R. s. ) $ 541- 2351 through 41- 2379.
The Athletic Commission was created i n 1958 to regulate a l l professional
boxing, sparring and wrestling matches and exhibitions conducted within
counties with a population of one hundred twenty- five thousand or more and
i n smaller counties, i f requested t o do so, via a County Board of
Supervisors' resolution. Today the Commission regulates a l l professional
boxing and wrestling contests i n the State.
The three members of the Commission are appointed by the Governor t o
three- year terms. The Commission has no full- time support s t a f f .
However, the Commission does employ an executive secretary on a part- time
basis .
The Commission l i c e n s e s r e f e r e e s , judges, matchmakers, promoters,
t r a i n e r s , ring announcers, timekeepers, ringside physicians, boxers,
wrestlers, managers and seconds.
Our review revealed t h a t the Commission has not f u l f i l l e d its
r e s p o n s i b i l i t y to ensure that p a r t i c i p a n t s i n professional boxing comply
with s t a t u t o r y requirements. A s a r e s u l t , some unlicensed individuals
have participated i n professional boxing and promoters have not paid the
two percent g a t e t a x i n compliance with the s t a t u t e s . ( page 7)
Our review also found t h a t changes are needed to improve the regulation of
boxing and b e t t e r protect p a r t i c i p a n t s from harm. ( page 15)
Further, our review found t h a t the Commission has not complied with a l l
s t a t u t o r y requirements dealing with professional wrestling. However, the
r e s u l t s o f t h e s e noncompliances do not threaten t h e h e a l t h , safety and
welfare of the public or p a r t i c i p a n t s . Deregulation of professional
wrestling could occur without endangering the health and safety of the
public or p a r t i c i p a n t s . ( page 25)
Finally, the Commission has not complied with A. R. S. $ 5- 224.~ regarding
the requirement that it hold monthly meetings. However, given the amount
of business the Commission must t r a n s a c t , and the s t a t e of the
Commission's finances, t h i s requirement appears unnecessary. Also, with
reference t o the Commission's finances, the commissioners and the
Commission's executive secretary have not been paid a l l of the per diem
and compensation t o which they are e n t i t l e d . ( page 31)
Consideration should be given t o the following recommendations:
1. The Commission should require t h a t a l l p a r t i c i p a n t s i n
professional boxing be licensed and pay a l l fees due to the State.
2. The Commission should require t h a t ringside physicians and
Commission s t a f f f i l e reports as specified i n the s t a t u t e s .
3. The Commission should require t h a t promoters comply with the
provisions of A . R. S. $ 5- 233 and that promoters provide evidence
of that compliance.
4. The Commission should c o l l e c t a l l fees due t o the S t a t e under the
provisions of A. R. S. $ 5- 235.
5. The Commission expand its pre- fight examination to encompass a
review of a f i g h t e r ' s : hearing, vision, mouth, glands,
respiratory system, blood pressure, heart, abdomen, reflexes,
nervous system and hands. I n addition, t e s t s should be made f o r
hernias and drug or alcohol usage - and urine t e s t s should be
performed .
6. The Legislature enact l e g i s l a t i o n requiring f i g h t e r s t o have
annual physical examinations.
7. The Commission develop and maintain a comprehensive medical
history on each f i g h t e r which should be periodically reviewed by
a Commission physician f o r indications of cumulative physical
damage.
8. The Commission obtain from the New York Boxing Commission its
recorded seminar on boxing i n j u r i e s and require a l l ringside
physicians t o view the recording.
9. The Legislature enact l e g i s l a t i o n to provide ring physicians with
t h e a u t h o r i t y t o stop a f i g h t and examine a f i g h t e r .
10. The Commission strengthen its licensing procedures by
f i n g e r p r i n t i n g a p p l i c a n t s and contacting other boxing commissions
regarding suspensions, knockouts or other i n j u r i e s and won/ lost
records.
11. The Commission consider developing a " passport" system of
licensing similar to that used by the New York Boxing Commission.
12. The Legislature enact l e g i s l a t i o n increasing t h e g r o s s r e c e i p t s
tax and revising the provisions governing the tax on t e l e v i s i o n
and radio r o y a l t i e s i n order t o help fund the above
recommendations.
13. The Legislature should consider eliminating s t a t u t o r y provisions
regulating professional wrestling.
iii
INTRODUCTION AND BACKGROUND
The Office of the Auditor General has conducted a performance audit of the
Athletic Commission i n response to a January- 30, 1980, resolution of the
Joint Legislative Oversight Committee. This performance audit was
conducted as a part of the Sunset Review s e t forth i n Arizona Revised
Statutes ( A. R. s.) $$ 41- 2351 through 41- 2379.
The Athletic Commission was created i n 1958 to regulate a l l professional
boxing, sparring and wrestling matches and exhibitions conducted within
counties with a population of one hundred twenty- five thousand or more and
i n smaller counties, i f requested to do so, via a County Board of
Supervisors' resolution. Today the Commission regulates a l l professional
boxing and wrestling contests i n the State.
The three members of the Commission are appointed by the Governor to
three- year terms. The Commission has no full- time support s t a f f . Support
functions are handled by the Arizona State Boards Administrative Office
( ASBAO), which was created i n 1976. ASBAO serves as the support s t a f f f o r
the Commission and ten other State boards or commissions, providing
s e c r e t a r i a l and c l e r i c a l services f o r each tenant board or commission.
The Commission does employ an executive secretary on a part- time basis.
The Commission licenses referees, judges, matchmakers, promoters,
t r a i n e r s , ring announcers, timekeepers, ringside physicians, boxers,
wrestlers, managers and seconds.
The Commission is funded through fees charged for licenses and the
collection of a two percent tax on adjusted gross receipts for
professional boxing or wrestling matches or exhibitions. Ninety percent
of the fees collected are deposited in the State Athletic Commission
Fund. The remaining ten percent is deposited i n the State General Fund.
Table I i l l u s t r a t e s the expenditures of the Commission f o r f i s c a l years
1977- 78 through 1980- 81 and the appropriation f o r f i s c a l year 1981- 82.
TABLE I
SUMMARY OF COMMISSION EXPENDITURES FOR FISCAL YEARS
1977- 78 THROUGH 1980- 81 AND THE APPROPRIATION FOR
FISCAL YEAR 1981- 82
Personal s e r v i c e s $ 1,900 $ 2,400
Employee r e l a t e d 8 3 400
Professional and
outside s e r v i c e s 1,522 2,400
Travel i n s t a t e 5 00
Travel out of s t a t e
Other operating expense 329 500
Equipment
Appropriation
1979- 80 1980- 81 1981- 82
The Auditor General expresses g r a t i t u d e t o the members of the A t h l e t i c
Commission and t o the s t a f f of the ASBAO f o r t h e i r cooperation, a s s i s t a n c e
and c o n s i d e r a t i o n during the course of t h e a u d i t .
* For f i s c a l year 1981- 82, the Board received a lump sum a p p r o p r i a t i o n
of $ 18,900.
SUNSET FACTORS
SUNSET FACTOR: OBJECTIVE AND
PURPOSE I N ESTABLISHING THE COMMISSION
The Athletic Commission was created i n 1958 to regulate professional
boxing, sparring and wrestling matches and exhibitions i n Arizona.
According to Commission records, its goals a r e t o
" Assure t h a t the g r e a t e s t p o s s i b l e p r o t e c t i o n , both
physically and f i n a n c i a l l y , is provided p a r t i c i p a n t s
and a l l i n t e r e s t e d p a r t i e s of boxing and wrestling
matches. C o l l e c t t h e complete and proper amount of tax
revenue due the commission."
SUNSET FACTOR: THE DEGREE TO WHICH THE AGENCY HAS
BEEN ABLE TO RESPOND TO THE NEEDS OF THE PUBLIC
AND THE EFFICIENCY WITH WHICH IT HAS OPERATED
The Athletic Commission has not f u l f i l l e d its r e s p o n s i b i l i t y to ensure
t h a t p a r t i c i p a n t s i n professional boxing comply with s t a t u t o r y
requirements. A s a r e s u l t , some unlicensed individuals have p a r t i c i p a t e d
i n professional boxing and promoters have not paid the two percent gate
tax i n compliance with the s t a t u t e s . ( page 7)
SUNSET FACTOR: THE EXTENT TO WHICH THE COMMISSION
HAS ENCOURAGED INPUT FROM THE PUBLIC BEFORE
PROMULGATING ITS RULES AND REGULATIONS AND THE
EXTENT TO WHICH I T HAS INFORMED THE PUBLIC AS
TO ITS ACTIONS AND THEIR EXPECTED IMPACT ON
THE PUBLIC
Meetings of the Commission are open to the public. Notices of meetings
are posted i n the Occupational Licensing Building and a r e circulated to
interested p a r t i e s through d i r e c t mailings. The Commission has heard
statements from public organizations and individuals and has made an
e f f o r t to incorporate such public input i n t o its procedures.
SUNSET FACTOR: THE EXTENT TO WHICH
THE COMMISSION HAS BEEN ABLE TO INVESTIGATE
AND RESOLVE COMPLAINTS THAT ARE WITHIN
ITS JURISDICTION
During the period January 1, 1981, t o August 1, 1981, the Commission
received only two complaints. Our review determined t h a t the Commission
reviewed and resolved both complaints i n a timely manner.
SUNSET FACTOR: THE EXTENT TO WHICH
THE COMMISSION HAS OPERATED WITHIN
THE PUBLIC INTEREST
The Commission has taken p o s i t i v e a c t i o n s t o p r o t e c t f i g h t e r s from
physical harm including requiring a c c i d e n t i n s u r a n c e f o r boxers and
p r o t e c t i v e padding f o r r i n g f l o o r s . The Commission has a l s o developed
boxer- promoter c o n t r a c t s requiring information about p r i o r f i g h t s and has
required matchmakers t o j u s t i f y i n w r i t i n g why proposed f i g h t s would be
competitive. However, the Commission may not have operated i n the public
i n t e r e s t t o the e x t e n t t h a t it has allowed unlicensed i n d i v i d u a l s t o
p a r t i c i p a t e i n p r o f e s s i o n a l boxing and some promoters t o not pay t h e two
percent gate tax i n compliance with the s t a t u t e s .
SUNSET FACTOR: THE EXTENT TO WHICH THE RULES AND
REGULATIONS PROMULGATED BY THE COMMISSION ARE
CONSISTENT WITH LEGISLATIVE MANDATE
Following passage of new l e g i s l a t i o n i n 1980, the Commission promulgated
new r u l e s which were c e r t i f i e d by the Attorney General i n January 1981.
SUNSET FACTOR: THE EXTENT TO WHICH THE
ATTORNEY GENERAL OR ANY OTHER AGENCY OF
STATE GOVERNMENT HAS THE AUTHORITY TO
PROSECUTE ACTIONS UNDER THE ENABLING LEGISLATION
A. R. S. $ 5- 236 s t a t e s , i n p a r t :
" A person is g u i l t y of a c l a s s 2 misdemeanor who:
" 1. Conducts, holds o r gives boxing o r wrestling
c o n t e s t s o r p a r t i c i p a t e s i n any boxing or
w r e s t l i n g c o n t e s t without f i r s t having procured an
appropriate l i c e n s e a s prescribed i n t h i s a r t i c l e .
" 2. Violates any provision of t h i s chapter or any r u l e
or regulation adopted pursuant t o t h i s chapter."
SUNSET FACTOR: THE EXTENT TO WHICH THE
COMMISSION HAS ADDRESSED DEFICIENCIES I N
ITS ENABLING STATUTES WHICH PREVENT I T FROM
FULFILLING ITS STATUTORY MANDATE I
The Athletic Comiesicn developed proposed l e g i s l a t i o n f o r the 1980
Legislative Session which was passed, signed by the Governor and became
effective i n 1980. This new l e g i s l a t i o n gave the Commission statewide
j u r i s d i c t i o n over boxing and wrestling and more d i s c r e t i o n a r y a u t h o r i t y
regarding fees and the conduct of boxing and wrestling matches. This
l e g i s l a t i o n was prompted i n part t o o b t a i n c o n t r o l over " barroom boxing"
and " toughman" contests which p r i o r to the l e g i s l a t i o n did not f a l l under
Commission control.
SUNSET FACTOR: THE EXTENT TO WHICH CHANGES ARE
NECESSARY I N THE LAWS OF THE COMMISSION TO ADEQUATELY
COMPLY WITH THE FACTORS LISTED I N THIS SUBSECTION.
Ring physicians should be given s t a t u t o r y authority to stop a contest and
examine a boxer t o determine whether the boxer is physically capable of
continuing. ( page 20)
A. R. S. $ 5- 235 should be amended to increase the two percent tax on gross
r e c e i p t s , and t o r e v i s e t h e provisions governing t h e t a x on t e l e v i s i o n
receipts. ( page 21)
A. R. S. $ 5- 225 should be amended t o eliminate t h e r e g u l a t i o n of
professional wrestling. ( page 29)
A. R. S. $ 5- 224. D and related provisions should be amended t o delete the
requirement of monthly meetings. ( page 31)
FINDING I
THE ATHLETIC COIMISSION HAS NOT FULFILLED ITS RESPONSIBILITY TO ENSURE
THAT PARTICIPANTS I N PROFESSIONAL BOXING COMPLY WITH STATUTORY
REQUIREMENTS. AS A RESULT, SOME UNLICENSED INDIVIDUALS HAVE PARTICIPATED
I N PROFESSIONAL BOXING AND PROMOTERS HAVE NOT PAID THE TWO PERCENT GATE
TAX I N COMPLIANCE WITH THE STATUTES.
A. R. S. $ 5- 227. A s t a t e s :
" The commission s h a l l :
" 1. Have s o l e d i s c r e t i o n , management, control and
j u r i s d i c t i o n over a l l ( boxing) and wrestling c o n t e s t s
held within the s t a t e unless exempt from application of
t h i s chapter by 55- 222.
" 2. Have sole control, authority and j u r i s d i c t i o n over
any licenses required by t h i s chapter."
Our review of the Athletic Commission revealed t h a t
1. The Commission has not required t h a t a l l p a r t i c i p a n t s i n
professional boxing be licensed as required by A. R. S. $ 5- 228.
2. The Commission has not required t h a t ring physicians and
Commission s t a f f comply with the reporting provisions of A. R. S.
$ 55- 233 and 5- 225 respectively. For eight of the nine boxing
matches held from January 1, 1981, through September 30, 1981,
the Commission is unable to provide evidence t h a t any physician
attended the matches as required by A. R. S. $ 5- 233.
3. The Commission has not required t h a t a l l boxing promoters pay t o
the State the tax on gross receipts specified i n A. R. S. $ 5- 235.
The Commission Has Not Required That A l l
P a r t i c i p a n t s i n Professional Boxing Be
Licensed A s Reauired Bv A. R. S. $ 5- 228
A. R. S. 55- 228 s t a t e s :
" A l l referees, judges, matchmakers, promoters,
t r a i n e r s , ring announcers, timekeepers, ringside
physicians, boxers and wrestlers and t h e i r managers and
seconds are required to be licensed by the commission.
The commission s h a l l not permit any such person t o
p a r t i c i p a t e i n the holding of 3s. y boxing or wrestling
contest unless he s h a l l have f i r s t procured a
license." ( Emphasis added)
Our review of the license f i l e s maintained by the Athletic Commission
revealed t h a t the Commission has allowed professional boxers to compete i n
boxing matches without being licensed by the Athletic Commission. I n one
recent match, four boxers competed without being licensed. Four managers
were also unlicensed and so was a second* to a boxer.
A. R. S. $ 5- 236 s t a t e s :
" A person is g u i l t y of a class 2 misdemeanor who:
" 1. Conducts, holds or gives boxing or wrestling
contests or p a r t i c i p a t e s i n any boxing or
wrestling contest without f i r s t having procured an
appropriate license a s prescribed i n t h i s a r t i c l e .
" 2. Violates any provision of t h i s chapter or any rule
or regulation adopted pursuant t o t h i s chapter."
* A second is an a s s i s t a n t to a boxer.
8
Thus, the four boxers* who were not licensed could be g u i l t y of a c l a s s 2
misdemeanor under the provisions of A. R. S. $ 5- 236 and the Commissioners
could be disciplined for t h e i r f a i l u r e t o comply with A. R. S. $ 5- 228 which
s t a t e s t h a t the Commission s h a l l not permit unlicensed individuals to
p a r t i c i p a t e i n boxing matches. The Arizona Criminal Code s t a t e s t h a t
individuals convicted of a c l a s s 2 misdemeanor may be imprisoned f o r up t o
four months and may be fined up t o $ 750 for each offense.
In addition, by f a i l i n g t o license t h e i n d i v i d u a l s involved i n t h i s one
match the Commission f a i l e d t o c o l l e c t $ 250.00 i n license fees.
The Commission appears t o take a casual approach toward t h e l i c e n s u r e
requirement. During pre- fight weigh- ins and other a c t i v i t i e s , Commission
staff announce that a l l contestants should be licensed and anyone wishing
to obtain a license could do so a t any time prior t o f i g h t time. Had the
Commission checked the boxers' names against the master licensee l i s t i n g
maintained by the ASBAO, it would have been immediately aware of a l l
individuals who were not licensed and could have required t h a t these
individuals become licensed p r i o r to f i g h t time.
The Commission Has Not Reauired That
Ring Physicians and Commission S t a f f
Com~ lvW ith the R e ~ o r t i n aP rovisions
Of A. R. S. $ 55- 233 and 5- 225 Respectively
A. R. S. $ 5- 233.~ s t a t e s :
" A l l boxers, wrestlers and referees s h a l l be examined
by a physician licensed by t h i s s t a t e before entering
the ring, and the examining physician s h a l l
immediately f i l e with the commission a written report
of the examination...." ( Emphasis added)
* One of the unlicensed boxers was ranked as the number two Junior
Welterweight i n the world. He participated i n a September 29, 1981,
boxing match i n Phoenix, Arizona.
Our review of the records of a l l professional boxing matches held from
January 1, 1981, through September 30, 1981, revealed t h a t only one
written report was f i l e d f o r the nine matches held during t h a t period. An
" o f f i c i a l r e s u l t s form" is submitted f o r each boxing match which contains
information on the blood pressure of each contestant and the o f f i c i a l
weight of each f i g h t e r . According to Commission s t a f f , t h i s report is the
written report specified i n A. R. S. $ 5- 233. A. However, only one of the
nine o f f i c i a l r e s u l t forms was signed by a physician. According to the
Commissioners, the physicians report verbally to the Commission. A verbal
report is not i n compliance with t h e w r i t t e n report requirement specified
i n A. R. S. s233. A. Further, the Commission was not able to document t h a t
verbal reports have always been made.
A. R. S. $ 5- 225.~. s t a t e s :
" A l l boxing or wrestling contests are subject t o the
provisions of t h i s chapter. The commission s h a l l f o r
every contest:
" 1. Direct a deputy to be present.
" 2. Direct the deputy to make a written report."
Our review of the f i l e s of the nine boxing matches held from January 1,
1981, to September 30, 1981, revealed t h a t no written reports were f i l e d
by any Commission s t a f f during that time.
Each boxing match held i n Arizona is given a separate f i l e i n the
Commission's o f f i c e . That f i l e should contain: 1) a copy of the boxing
program; 2) the judges' score cards; 3) the " o f f i c i a l r e s u l t s form";
4) a " payoff sheet" which shows the amount the promoter paid each
f i g h t e r ; 5) a report which shows how much is paid t o the r e f e r e e s ,
judges, timekeepers and other p a r t i c i p a n t s ; and 6) copies of the
Commission- approved contracts between the boxers and the promoters.
Our review of these f i g h t f i l e s revealed t h a t the information and
documentation i n the f i l e s is grossly inadequate.
The payoff sheet contained i n the f i l e s is to show the amount paid t o each
boxer, and the boxer is required t o i n i t i a l the payoff sheet to show t h a t
the boxer has received payment from the promoter. Administrative r u l e
R4- 3- 406 s t a t e s :
" A. A l l contestants s h a l l be paid i n f u l l according to
t h e i r contracts, and no part or percentage of t h e i r
remuneration may be withheld except by order of an
o f f i c i a l of the Commission, nor s h a l l any part thereof
be returned through arrangement with the boxer o r h i s
manager to any matchmaker or promoter.
" B. Payment s h a l l be made immediately a f t e r the
contest or card under the supervision of a Commission
representative."
In reviewing the " payoff sheet" for recent matches, we noted numerous
discrepancies between the amounts paid t o t h e c o n t e s t a n t s and the amounts
specified i n the boxers' contracts. Commission representatives informed
our s t a f f t h a t boxers may receive advances or have deductions made for
license fees, thus creating some of the discrepancies. However, formal
documentation of these differences is not made.
The Athletic Commissioners informed our s t a f f t h a t the boxers are required
to i n i t i a l the " payoff sheet" t o verify t h a t payment has been received.
However, i n a recent match, we noted t h a t the promoter i n i t i a l e d f i v e
payments for boxers and told the boxers t h a t he would pay them a t a l a t e r
time. Another boxer's payment was not l i s t e d and the payment was not
i n i t i a l e d , thus precluding a determination t h a t payment was made.
Finally, no Commissioner or s t a f f member sign " payoff sheets" to v e r i f y
t h a t he witnessed the payments.
The Commission report on the amounts paid t o judges, referees, timekeepers
and other required personnel is d i f f i c u l t to understand. There appears t o
be l i t t l e or no organization on the report and d o l l a r amounts are entered
i n numerous locations f o r no apparent reason. I n one case, we noted t h a t
a single individual was l i s t e d with five separate d o l l a r amounts scattered
around the name. Based on t h i s report, it is impossible t o accurately
determine how much, i f any, money was paid to each individual.
These s o r t s of problems were common throughout a l l of the boxing f i l e s
maintained a t the Commission's office.
For Eight of the Nine Boxing Matches
Held From January 1, 1981, Through
September 30, 1981, the Commission
Is Unable To Provide Written Evidence That
Anv Phvsician Attended The Matches
A s Required By A. R. S. $ 5- 233
A. R. S. $ 5- 233.~ s t a t e s :
" Every person holding or sponsoring any boxing or
wrestling contest s h a l l have i n attendance a t every
boxing or wrestling contest a physician licensed by
t h i s s t a t e . . . ."
During our review of the records f i l e d i n the Commission office concerning
the nine matches held from January 1, 1981, to September 30, 1981, we
noted that only one of these boxing f i l e s contained documentation to show
that a physician had attended the match as required by law.
The ring physician is responsible for ensuring that professional boxers
are physically capable of competing i n a match. The physician is required
to perform two physical examinations of the boxers prior to the fight and
is required to attend to any boxer who is knocked out or injured. The
Commissioners assured audit s t a f f that a physician has been i n attendance
a t each boxing contest. However, there is no documentation for eight of
the nine matches to support t h i s , and we were unable to locate any
documentation to show that the two required physical examinations were
performed before the match.
The Commission Has Not Required That
A l l Boxing Promoters Pay To the S t a t e
the Tax On Gross R e c e i ~ t sS ~ e c i f i e d
I n A. R. S. $ 5- 235
A- R- S. $ 5- 235 s t a t e s i n p a r t :
" A. Any person who promotes a p r o f e s s i o n a l boxing o r
w r e s t l i n g match o r e x h i b i t i o n s h a l l within ten
days t h e r e a f t e r pay t o the commission two percent
of the gross r e c e i p t s , a f t e r the deduction of
c i t y , s t a t e and f e d e r a l taxes, of such match o r
e x h i b i t i o n .
" B. After reasonable n o t i c e and hearing open t o the
public, the commission may revoke the l i c e n s e of
any person licensed under the provisions of t h i s
a r t i c l e f o r v i o l a t i o n of t h i s a r t i c l e o r t h e r u l e s
and r e g u l a t i o n s of the Commission promulgated
under t h i s a r t i c l e . . . . "
Our review of the Commission's records revealed t h a t of the nine matches
held from January 1, 1981, t o October 15, 1981, the gross r e c e i p t s t a x w a s
p r o p e r l y p a i d f o r two, paid l a t e f o r two, and not paid f o r f i v e a s of
October 15, 1981. The Commission has not exercised its d i c i p l i n a r y
a u t h o r i t y i n A. R. S. $ 5- 235.~ t o f o r c e t h e promoters t o pay the S t a t e , and
the Commission allowed one promoter t o continue t o hold boxing matches
despite the f a c t t h a t he had not submitted payment f o r t h r e e matches, two
of which were held p r i o r t o June 1, 1981. The unpaid gross revenue taxes
due t h e S t a t e cannot be determined because the Commission does not
maintain records which provide any i n d i c a t i o n of the amount of gross
r e c e i p t s f o r a match.
CONCLUSIONS
Our review of the Athletic Commission revealed t h a t the Commission has not
required t h a t
1. A l l p a r t i c i p a n t s i n professional boxing be licensed as required
by A. R. S. $ 5- 228,
2. Ring physicians and Commission s t a f f comply with the reporting
provisions of A. R. S. $ 55- 233 and 5- 225, respectively, and
3. A l l boxing promoters pay to the S t a t e t h e t a x on gross receipts
specified i n A. R. S. $ 5- 235.
Of the nine boxing matches held from January 1, 1981, through
September 30, 1981, the Commission is unable to provide evidence t h a t any
physician attended eight of the matches or t h a t proper payment of the
gross receipts tax was made for seven matches.
RECOMMENDATIONS
Consideration should be given to the following recommendations:
1. The Commission should require t h a t a l l p a r t i c i p a n t s i n
professional boxing be licensed and pay a l l fees due t o the State.
2. The Commission should require that ring physicians and Commission
s t a f f f i l e reports a s specified i n the s t a t u t e s .
3. The Commission should require that promoters have a physician i n
attendance a t each match as s p e c i f i c a t i o n A. R. S. $ 5- 273.~ and
t h a t promoters provide evidence of t h a t compliance.
4. The Commission should c o l l e c t a l l fees due to the S t a t e under the
provisions of A. R. S. $ 5- 235.
FINDING I1
CHANGES ARE NEEDED TO IMPROVE THE REGULATION OF BOXING AND BETTER PROTECT
PARTICIPANTS FROM PHYSICAL HARM.
In January 1981, the Task Force on Boxing i n Canada issued a report on the
regulation of boxing i n Canada. In t h i s report, the Task Force stated:
" In July of t h i s year, Cleveland Denny died following
blows received seventeen days e a r l i e r i n a non- title
fight with Gaetan Hart i n Montreal. Previous recent
knockouts and d i f f i c u l t f i g h t s not knowingly reported
to fight o f f i c i a l s may possibly have caused the death.
Earlier, Ralph Racine was also knocked out and lapsed
into a lengthy coma. Fortunately, he has recovered
consciousness and mobility but may never completely
return to normal i n a l l respects. More recently,
Johnny Owen of Wales died following a fight i n
California. Owen was floored three times during the
fight and many ringside observers thought that the
referee should have stopped the fight before the f a t a l
blow was struck.
" This brings the t o t a l boxing deaths i n the l a s t 35
years to approximately 335 in addition to the hundreds
of boxers who have suffered brain damages of varying
degrees often changing t h e i r personalities forever."
The Canadian report a l s o s t a t e d t h a t research into boxing i n j u r i e s ,
especially with regard to brain damage is almost nonexistent. While there
apparently have been no ring- related f a t a l i t i e s i n Arizona, the recent
deaths of boxers i n California and New York clearly i l l u s t r a t e the
potential harm to professional boxers.
The Commission has taken p o s i t i v e a c t i o n s t o protect boxers from physical
harm including requiring protective padding f o r ring f l o o r s and accident
insurance f o r boxers. The Commission has also sought t o protect f i g h t e r s
against mismatches by developing boxer- promoter contracts requiring
information about p r i o r f i g h t s and by requiring matchmakers t o specify i n
writing why proposed f i g h t s would be competitive. However, our review of
the Commission revealed t h a t s t a t u t o r y and administrative changes are
needed i f the Commission is t o adequately regulate boxing and protect
p a r t i c i p a n t s from physical harm. Specifically:
- The Commission needs t o improve its licensing operation.
- Medical examinations f o r boxers need t o be more extensive and
thorough.
- Ring physicians should be b e t t e r trained and given additional
authority.
- Additional funding should be provided t o the Commission.
The Commission Needs To
Im~ rove Its Licensing O ~ e r a t i o n
Current Commission licensing procedures provide l i t t l e i n the way of
protection f o r boxing p a r t i c i p a n t s . During our review of the Commission
we noted the following deficiencies i n the Commission's licensing
operation.
F i r s t , a s noted on page 9, the Commission is n o t l i c e n s i n g a l l of the
boxing p a r t i c i p a n t s t h a t it is required t o license. Second, the
Commission does not adequately verify the information it receives from
those p a r t i c i p a n t s it does license.
For example, the Commission does not take f i n g e r p r i n t s or otherwise review
applicants f o r criminal records. Further, the Commission does l i t t l e to
1) determine t h a t a licensee is not under suspension i n other
j u r i s d i c t i o n s , 2) verify t h e l i c e n s e e ' s won/ lost record, or 3) a s c e r t a i n
recent knockouts or i n j u r i e s t h a t a licensee has suffered.
The Commission's f a i l u r e to investigate or review applicants f o r licensing
is p a r t i a l l y due to the nature of the boxing industry. Some f a c t o r s
inherent i n the boxing industry which make licensing d i f f i c u l t are these:
- Mobility of the p a r t i c i p a n t s - Boxers are extremely mobile i n
that they may f i g h t not only i n many d i f f e r e n t s t a t e s , but also
d i f f e r e n t countries. Many f i g h t e r s appearing i n Arizona f i g h t s
do not reside i n Arizona and seek a license only for a s p e c i f i c
event. Further, these persons may a r r i v e i n Arizona only hours
before a f i g h t and then leave the State soon t h e r e a f t e r .
- I n s t a b i l i t y of f i g h t programs - Training i n j u r i e s , i l l n e s s e s o r
other unforeseen events may r e s u l t i n an unlicensed boxer being
added to a f i g h t program j u s t p r i o r to a f i g h t . I n such
i n s t a n c e s t h e time available t o investigate applicants f o r
licensure is p a r t i c u l a r l y limited.
- Absence of i n t e r j u r i s d i c t i o n a l regulatory e f f o r t s - Unlike many
other regulated i n d u s t r i e s , there are no established
i n t e r j u r i s d i c t i o n a l regulatory programs among t h e d i f f e r e n t s t a t e
commissions regulating boxing. For example, there is no national
association of s t a t e boxing commissions or other comparable body,
no nationwide information system on boxing licensees and no
formal system for sharing regulatory information among the
d i f f e r e n t s t a t e s . Therefore, the Commission has no means to
quickly review a license applicant.
The New York Boxing Commission has adopted a system of monitoring i t ' s
licensees t h a t may be worthy of implementation i n Arizona.
@
Individuals wishing to p a r t i c i p a t e i n professional boxing i n New York a r e
required to obtain a " Boxing Passport" before they are allowed t o
compete. The passport contains the following information:
- boxer' s name,
- date of b i r t h ,
- passport number,
- i d e n t i f i c a t i o n photograph,
- boxer's signature,
- medical h i s t o r y and r e s u l t s of required annual physical,
- f i g h t record, and
- any necessary notes such a s suspensions.
To keep the passports c u r r e n t , t h e Commission requires t h a t
- boxers surrender t h e i r passports on the day of t h e i r f i g h t s ,
usually a t weigh- in;
- the passports be reviewed carefully to ensure t h a t the boxer is
not under suspension and t h a t he is physically capable of
competing as a t t e s t e d to by the annual physical and t h e p r e f i g h t
physical given t o the boxer;
- the Commission representatives f i l l i n the f i g h t r e s u l t s i n the
boxing passport, including notations of knockouts or suspensions;
and
- when the purses are d i s t r i b u t e d , the passports are then returned
to the contestants.
The New York Boxing Commission asks other s t a t e s t o obtain and update the
passports when New York f i g h t e r s appear i n f i g h t s outside of New York.
More Extensive
Medical Examinations
The report by the Task Force on Boxing i n Canada recommended extensive and
regular medical examinations f o r boxers as part of licensing. When
compared with the Task Force recommendations, the medical examinations
performed by ring physicians i n Arizona a r e decidedly- deficient.
Boxing can r e s u l t i n brain damage, serious physical impairment or death.
These consequences can be the r e s u l t of one f i g h t or several f i g h t s . TO
protect against such consequences the Canadian study recommended that more
comprehensive prefight examinations and annual examinations be made.
The Canadian study recommended t h a t a prefight examination encompass a
review of the following areas: hearing, vision, mouth, glands,
respiratory system, blood pressure, heart, abdomen, h e r n i a , r e f l e x e s ,
nervous system and hands. In addition it recommended t h a t a urine t e s t be
required and a t e s t made f o r evidence of alcohol or drug use.
Further, the Canadian study recommended that boxers undergo comprehensive
medical examinations annually and t h a t a boxing authority maintain a
medical history on each licensee. The study recommended t h a t the annual
examination include an electroencephalogram, an electrocardiogram, a chest
X ray, a complete blood analysis, a complete u r i n a l y s i s , serological t e s t s
and, i f indicated, a catscan.
By way of c o n t r a s t , i n Arizona only two s u p e r f i c i a l medical examinations
are performed. The f i r s t examination is conducted during the weigh- in on
the day of the f i g h t and the second is conducted immediately before the
f i g h t . These examinations consist of a blood pressure reading and a
visual scan of the contestant by t h e r i n g physician f o r signs of physical
ailments and drug or alcohol use. Further, as reported on page 11, these
physicals are not always documented, and no medical h i s t o r y is maintained
on the licensees.
A. R- S. $ 5- 233 s t a t e s :
" A. A l l boxers, wrestlers and referees s h a l l be
examined by a physician licensed by t h i s s t a t e before
entering the ring, and the examining physician s h a l l
immediately f i l e with the commission a written report
of the examination. The cost of the examination is
payable by the person conducting t h e c o n t e s t or
exhibition." ( ~ m ~ h a saidsd ed)
There are no other medical examination requirements although the
Coriission can d i r e c t f i g h t e r s who have s u f f e r e d multiple knockouts t o
obtain catscans or EEG's before fighting again. They have done so only
once .
Of the other s t a t e s t h a t regulate boxing, a t l e a s t eleven s t a t e s have
s t a t u t o r y p r o v i s i o n s r e q u i r i n g annual medical examinations. These s t a t e s
a r e C a l i f o r n i a , Connecticut, Delaware, Hawaii, Idaho, I l l i n o i s , New York,
Massachusetts, Tennessee, Utah and Virgina. The Commission has considered
requiring annual medical examinations but has - r e j e c t e d the idea because of
budget c o n s t r a i n t s and t h e f i n a n c i a l hardships such a requirement would
impose on Arizona boxers. For example, the medical t e s t s f o r such
examinations c o s t $ 1 2 0 ~ f o r an EEG, $ 40" f o r an EKG, $ 41"" f o r a chest
X ray and $ 10" f o r a complete blood a n a l y s i s . I f required, a catscan
would c o s t a n a d d i t i o n a l $ 216.** Some f i g h t e r s earn a s l i t t l e as $ 150 a
f i g h t .
The Canadian Task Force f e l t the annual examinations and t e s t s t o be so
c r i t i c a l t h a t it recommended the examinations be p a r t l y funded from taxes
on boxing events.
Ring Physician T r a i n i n g And Authority
The Commission w i l l grant a l i c e n s e a s a ring physician t o any Arizona
licensed M. D. or Osteopath. No s p e c i a l t r a i n i n g is required. The Task
Force on Boxing i n Canada recommended t h a t a l l r i n g physicians be required
t o complete a s p e c i a l t r a i n i n g program i n the medical a s p e c t s of boxing
with emphasis on brain and eye injuries.*** Arizona's A t h l e t i c Commission
has no such requirement. The New York Boxing Commission uses an
eight- hour p r o f e s s i o n a l seminar f o r r i n g physicians dealing with the
medical a s p e c t s of boxing. Audit s t a f f was informed by the New York
Boxing Commission t h a t it is making a video recording of one of these
seminars and is w i l l i n g t o make a copy a v a i l a b l e t o the Arizona Commission.
* Memorial Hospital of Phoenix
** University of Arizona Diagnostic Radiology Department
*** The Task Force a l s o recommended t h a t a l l r e f e r e e s , t r a i n e r s and
cornermen be required t o complete an educational program on the
p e r t i n e n t medical a s p e c t s o f boxing.
The Canadian Task Force on Boxing recommended t h a t ring physicians be
given the authority to stop a contest and examine a boxer t o determine i f
the boxer is physically capable of continuing the match. Ring physicians
i n New York and California have the authority t o stop a match and examine
the boxer. In Arizona, ring physicians do not have the authority to stop
a match.
Additional Funding
Presently the Commission does not have adequate s t a f f or funding t o
implement a d d i t i o n a l l i c e n s i n g and control measures and medical
requirements. While the Commission's f i s c a l year 1981- 82 budget
appropriation of $ 18,900 represents a 72 percent increase over f i s c a l year
1980- 81, it still does not appear to be adequate t o support t h e l i c e n s i n g
and medical examination procedures that are necessary given t h a t
- the Commission presently licenses 71 boxers, 27 wrestlers and 97
other individuals,
- the cost t o administer the medical t e s t s f o r annual medical
examinations is estimated to be $ 211 p e r l i c e n s e e or
approximately $ 15,000 f o r the 71 boxers currently licensed, and
- the Commissioners and t h e i r executive secretary were not paid the
f u l l per diem and compensation due them i n f i s c a l year 1980- 81.
( page 31)
A s a part of our review, we surveyed the Athletic Commission i n 36 other
states* which regulate professional boxing and wrestling. Our survey
revealed t h a t Arizona's two percent of gross receipts is the t h i r d lowest
r a t e i n these 37 s t a t e s . This information is presented i n Table 11.
* Our survey revealed t h a t professional boxing is regulated i n a t l e a s t
37 s t a t e s and not regulated i n 9 s t a t e s . We received no response from
4 s t a t e s .
TABLE I1
I l l i n o i s
Indiana
Maryland
Michigan
New Jersey
Wisconsin
Arkansas
California
Connecticut
Delaware
Idaho
Iowa
Kentucky
Massachusetts
Minnesota
Mississippi
Missouri
Nebraska
New Hampshire
New York
North Dakota
Ohio
Pennsylvania
Rhode Island
Utah
Vermont
Virginia
Washing ton
Alabama
Nevada
New Mexico
Tennessee
Maine
Texas
ARIZONA
Hawaii
West Virginia
SUMMARY OF EACH STATE'S TAX ON RECEIPTS FROM
PROFESSIONAL BOXING AND WRESTLING
Percentage on Gate Receipts
During f i s c a l year 1980- 81 t o t a l gross revenues for boxing and wrestling
matches a f t e r deductions f o r c i t y , s t a t e and federal taxes were at l e a s t
$ 218,648. This resulted i n a gross r e c e i p t t a x payment of $ 4,372.96. The
f i s c a l impact various r a t e s would have had on f i s c a l year 1980- 81 gross
r e c e i p t s t a x e s follows.
Gross Receipts Taxes Increases In Gross
1980- 1981 Gross Revenues Gross Receipts ~ e n e r a t e d By Receipts Taxes Resulting
After Allowed Deductions Tax Rates The Indicated Rate From Higher Rates
Tax On Televised Events
A. R. S. $ 5- 235 not only provides f o r a two percent tax on gross
receipts from boxing and wrestling matches but also provides t h a t
the Commission s h a l l receive two percent of the r o y a l t i e s from
t e l e v i s i o n or radio broadcasts. However, t h i s two percent figure is
computed a f t e r deductions f o r purse payments, which has resulted i n
the State receiving no payment. For example the Shields- Hearns
match produced TV r o y a l t i e s of $ 295,000. Two percent of t h i s figure
is $ 5,900.00. However, the promoter of t h i s match reported t h a t
purse payments exceeded $ 300,000. A s a r e s u l t , the S t a t e did not
get any r o y a l t i e s from the broadcasting of t h i s event. Had the
gross r e c e i p t s t a x been applied before purse deductions the S t a t e
would have received $ 5,900 from t h i s f i g h t .
CONCLUSION
Statutory and administrative changes are needed i f the Commission is
to adequately regulate boxing and protect p a r t i c i p a n t s from physical
harm.
RECOMMENDATIONS
Consideration should be given to the following recommendations:
1. The Commission expand its medical examinations t o
encompass a review of a f i g h t e r ' s hearing, vision, mouth,
glands, respiratory system, blood pressure, h e a r t ,
abdomen, reflexes, nervous system and hands. I n addition,
t e s t s should be made f o r hernias and drug or alcohol usage
and urine t e s t s should be performed.
2. The Legislature enact l e g i s l a t i o n requiring fighters to have
annual physical examinations.
3. The Commission develop and maintain a comprehensive medical
history on each fighter which should- be periodically reviewed by
a Commission physician for indications of cumulative physical
damage.
4. The Commission obtain from the New York Boxing Commission its
recorded seminar on boxing i n j u r i e s and require a l l ring
physicians to view the recording.
5. The Legislature enact l e g i s l a t i o n to provide ring physicians with
the authority to stop a fight and examine a fighter.
6. The Commission strengthen its licensing procedures by
fingerprinting applicants and contacting other boxing commissions
regarding suspensions, knockouts or other i n j u r i e s , and won/ lost
records.
7. The Commission consider developing a " passport" system of
licensing similar t o t h a t used by the New York Boxing Commission.
8. The Legislature enact l e g i s l a t i o n increasing the gross receipts
tax and revising the provisions governing the tax on television
and radio royalties in order to help fund the above
recommendations.
FINDING I11
THE ATHLETIC COMMISSION HAS NOT COMPLIED WITH ALL STATUTORY REQUIREMENTS
DEALING WITH PROFESSIONAL WRESTLING. HOWEVER, THE RESULTS OF THESE
NONCOMPLIANCES DO NOT THREATEN THE HEALTH. SAFETY AND WELFARE OF THE
-- -
PUBLIC OR PARTICIPANTS. FURTHER, DEREGULATION OF PROFESSIONAL WRESTLING
COULD OCCUR WITHOUT ENDANGERING THE HEALTH AND SAFETY OF THE PUBLIC OR
PARTICIPANTS.
Under Arizona s t a t u t o r y provisions, p r o f e s s i o n a l w r e s t l i n g is regulated
much the same a s p r o f e s s i o n a l boxing. Our review revealed t h a t i f
s t a t u t e s r e l a t i n g t o p r o f e s s i o n a l w r e s t l i n g a r e amended t o e i t h e r r e g u l a t e
it as a n e x h i b i t i o n or deregulate it a l t o g e t h e r , the Commission would be
able t o a l l o c a t e its l i m i t e d resources t o more c r i t i c a l a r e a s without
increasing the l i k e l i h o o d of physical or f i n a n c i a l harm t o the public o r
the p a r t i c i p a n t s i n p r o f e s s i o n a l w r e s t l i n g . I n a d d i t i o n , of the 28 other
s t a t e s t h a t r e g u l a t e w r e s t l i n g , nine regulate i t a s a n e x h i b i t i o n not an
a t h l e t i c c o n t e s t .
S t a t u t o r v Provisions Relating To Wrestling
A. R. S. $ 5- 238 s t a t e s t h a t
" The commission may withhold a l l o r p a r t of a purse o r
other monies payable t o any c o n t e s t a n t , manager o r
second i f i n the judgement of the commission a boxing
c o n t e s t a n t is p a r t i c i p a t i n g i n a sham or fake boxing
contest o r is otherwise not competing honestly o r t o
the best of h i s a b i l i t y . "
A. R. S. $ 5- 236 s t a t e s t h a t
" A person is g u i l t y of a c l a s s 2 misdemeanor who: . . . . . . .
" 2. V i o l a t e s any provision of t h i s chapter o r any
r u l e o r r e g u l a t i o n adopted pursuant t o t h i s
chapter."
Thus, a boxer who p a r t i c i p a t e s i n a sham c o n t e s t may be penalized i n
criminal and/ or c i v i l a c t i o n . No such s t a t u t o r y provisions e x i s t s f o r
p r o f e s s i o n a l w r e s t l e r s .
A. R. S. $ 5 - 2 2 5 . ~ s t a t e s :
" A l l boxing o r wrestling c o n t e s t s a r e s u b j e c t t o the
provisions of t h i s chapter. The commission s h a l l f o r
every c o n t e s t :
" 1. Direct a deputy t o be present. -
" 2. Direct the deputy t o make a w r i t t e n report."
Our review of the implementation of t h i s requirement revealed t h a t the
Commission has appointed a deputy i n s p e c t o r t o a t t e n d each wrestling
contest." However, the deputy i n s p e c t o r does not f i l e w r i t t e n r e p o r t s
a f t e r wrestling matches.
It should be noted t h a t while the Commission r e q u i r e s t h e deputy i n s p e c t o r
t o a t t e n d wrestling matches he is not compensated f o r doing so.**
A. R. S. 55- 228 s t a t e s :
" A l l r e f e r e e s , judges, matchmakers, promoters,
t r a i n e r s , r i n g announcers, timekeepers, ringside
physicians, boxers and w r e s t l e r s and t h e i r managers and
seconds a r e required to be licensed by the commission.
The commission s h a l l not permit any such person t o
p a r t i c i p a t e i n the holding of any boxing or wrestling
c o n t e s t u n l e s s he s h a l l have f i r s t procured a license."
During our review of the l i c e n s e f i l e s maintained by the Commission, we
noted t h a t the following wrestling o f f i c i a l s did not have l i c e n s e f i l e s :
- Ring announcer,
- Timekeeper,
- Ringside physician, and
- Manager.
* A s of September 30, 1981, t h e r e is only one a c t i v e promoter i n
Arizona. Matches a r e held i n Phoenix every F r i d a y n i g h t .
*" See page 22 f o r a complete discussion of the Commission's limited
f i n a n c i a l resources.
According to the deputy i n s p e c t o r t h e r i n g s i d e physician was licensed but
the license card had apparently been misplaced or l o s t . The Commission
issued a duplicate license to t h e r i n g s i d e physician.
A. R. S. $ 5- 233.~ s t a t e s :
" A l l boxers, wrestlers and referees s h a l l be examined
by a physician licensed by t h i s s t a t e before entering
the ring, and the examining physician s h a l l immediately
f i l e with the commission a written report of the
examination...."
During our audit we attended two p r o f e s s i o n a l wrestling matches. A t the
f i r s t match, the ringside physician was observed taking the blood pressure
of t h e r e f e r e e s and each professional wrestler and " looking over" each
contestant to s a t i s f y himself t h a t they were physically capable of
p a r t i c i p a t i n g i n the match. The ringside physician did not submit a
written report t o the Commission. During the second match, audit s t a f f
was informed t h a t t h e r i n g s i d e physician had been called away on a medical
emergency unrelated t o wrestling and did not return t o the match.
Although the Commission s t a f f assured t h e a u d i t s t a f f t h a t the required
p h y s i c i a n ' s r e p o r t had been submitted, it could not be determined i f the
required physical examinations were performed.
Our review of the records r e l a t i n g t o wrestling i n the Commission's f i l e s
contained no physician's report f o r any match held i n f i s c a l year 1980- 81
or 1981- 82 ( through September 1, 1981).
A- R. S. $ 5- 234 s t a t e s :
" If a boxing or wrestling c o n t e s t is held within the
corporate l i m i t s of a c i t y or town, the chief of police
s h a l l assign not l e s s than one o f f i c e r t o attend the
contest, and i f a boxing or wrestling contest is being
held without the corporate l i m i t s of a c i t y or town,
the county s h e r i f f s h a l l assign not l e s s than one of
h i s deputies to attend...."
During our v i s i t s to professional wrestling matches, we did not see any
uniformed officers in attendance. The promoter for the wrestling matches
had arranged for karate students from a local karate school to provide
security a t the matches.
A. R. S. $ 5- 235.~ s t a t e s :
" A t the end of each month the secretary shall report to
the department of administration division of finance
the t o t a l amount received under t h i s a r t i c l e from a l l
sources including license fees and s h a l l deposit the
amount with the s t a t e treasurer, who s h a l l place it i n
a special fund known as the s t a t e a t h l e t i c commission
fund. "
Our review determined that the Commission has not made a deposit with the
State Treasurer from July 1, 1981, through September 15, 1981. During
that time, t o t a l fees collected were $ 287.78, of which $ 215 were license
fees and $ 72.78 was the two percent gate tax specified i n A. R. S. $ 5- 235.
Despite the general noncompliance with statutory requirements relating to
professional wrestling, we were unable to identify any potential harm to
the public or to professional wrestling participants.
Deregulation of Professional Wrestling
A s of September 1, 1981, Arizona is one of 29 s t a t e s which regulate
professional wrestling. Of the other 28 s t a t e s , nine regulate wrestling
as an exhibition or entertainment sport rather than an a t h l e t i c contest.
These nine s t a t e s are I l l i n o i s , Michigan, Missouri, Nevada, New
Hampshire, New Jersey, New Mexico, New York and North Dakota. These
s t a t e s regulate professional wrestling as an exhibition rather than an
a t h l e t i c contest because the purpose of an exhibition is to entertain the
audience and to display wrestling s k i l l s rather than to determine which of
two contestants is the b e t t e r wrestler. In California, professional
wrestling may be presented to the public as an exhibition or a contest.
I f the wrestling match is announced as a contest, and the commission
determines that the wrestlers have participated i n a sham, the purse money
may be forfeited and the participants could have t h e i r licenses suspended
or revoked. I f the match is announced as an exhibition, no such penalties
can be imposed. Under the present Arizona s t a t u t e s , there is no penalty
for participation i n a sham wrestling match.
Many s t a t e s f e e l that wrestling is a sham and, i f regulated, should be
regulated as an exhibition, not as a contest. A professional wrestling
promoter told our s t a f f that wrestling is not a sham. He stated that the
outcome of matches is not predetermined, and that each wrestler is doing
his or her best to win each match. He did, however, concede that matches
may involve " highlights" which may not result i n an immediate victory for
one wrestler or the other, but do provide an entertaining evening for the
audience. These " highlightsw include such things as flying hammerlocks,
body slams and throwing wrestlers through the ropes onto the o f f i c i a l s '
table.
The current level of Commission regulation of professional wrestling is so
limited as to be meaningless. Commission presence a t matches is as much
entertainment value as regulatory value. For example, a t a recent match
the Commission's representative described to our auditors his part i n the
following prearranged s c r i p t . F i r s t he would be called upon to order a
wrestler to remove an axe handle from the ring. The wrestler would
refuse, and the Commission's representative would threaten to revoke the
wrestler's license. The wrestler would eventually hand over the axe
handle to the Commission's representative. The s c r i p t was acted out
exactly as described. A t another match, a wrestler was " fined" $ 100 by
the Commission representative for assaulting a referee. However, the
incident was a hoax to entertain the fans and no fine was actually
imposed. Such a c t i v i t y is not unusual a t wrestling matches. Referees,
managers, promoters and State o f f i c i a l s are a l l part of the show. The
chairman of the Athletic Commission s t a t e d t h a t i f wrestling is regulated
it should be regulated by whoever regulates entertainment-- not the
Athletic Commission.
CONCLUSION
Deregulating professional wrestling would not increase the likelihood of
physical or financial harm to the public or the participants in
professional wrestling.
Consideration should be given to eliminating statutory provisions
regulating professional wrestling.
FINDING IV
THE COMMISSION HAS NOT COMPLIED WITH A. R. S. $ 5- 224. D REGARDING THE
FREQUENCY OF MEETINGS. COMMISSIONERS AND ' THE CONMISSION'S EXECUTIVE
SECRETARY HAVE NOT BEEN PAID ALL OF THE PER DIEM AND COMPENSATION TO WHICH
THEY ARE ENTITLED.
A. R. S. $ 5- 224.~ s t a t e s :
" The commission s h a l l hold a regular meeting once i n
each calendar month and i n addition may hold special
meetings. A l l meetings of the commission s h a l l be open
to the public and reasonable notice of the meetings
s h a l l be given."
During the 33- month period from January 1, 1979, through September
30, 1981, the Commission did not hold ten of the s t a t u t o r i l y required
meetings. For the ten monthly meetings not h e l d , t h r e e meetings were
scheduled but subsequently canceled, and seven were not scheduled.
The 23 meetings t h a t were held during the 33- month period ending
September 30, 1981, l a s t e d an average of one hour. It should be noted
t h a t t h e Commissioners a r e e n t i t l e d t o receive $ 30 per diem plus t r a v e l
expenses for attending meetings. However, because of the Commission's
limited f i n a n c i a l resources, the Commissioners and t h e i r executive
secretary have not been paid the f u l l per diem or compensation t o which
they a r e e n t i t l e d . A s a r e s u l t , f o r f i s c a l year 1980- 81 each a t h l e t i c
commissioner was underpaid approximately $ 210 and the Commission' s
executive secretary was underpaid $ 813.
It is i r o n i c t h a t the Commission has not collected a l l of the l i c e n s e fees
and gross receipts taxes t h a t it should have given its c u r r e n t l i m i t e d
financial resources. ( pages 9 and 13)
In our opinion the requirements of A. R. S. $ 5- 224. D place an unnecessary
burden on the Athletic Commission given the brevity of most Commission
meetings and t h e l i m i t e d f i n a n c i a l resources available to the Commission.
CONCLUSION
The Commission has not complied with ARS $ 5- 224.~ regarding the frequency
of meetings. Commissioners and the Commission executive secretary have
not been paid a l l of the per diem and compensation t o which they are
e n t i t l e d .
RECOMMENDATION
The Legislature should amend A. R. S. $ 5- 224. D t o d e l e t e t h e requirement of
monthly Athletic Commission meetings.
ARIZONA STATE ATHLETIC COMMISSION
1645 West Jefferson Phoenix,. Arizona 85007
( 602) 271 - 3095
December 16, 1981
Douglas R. Norton
Auditor General,
State of Arizona
State Capitol
Suite 200
Phoenix, Arizona 85007
Re: Comments on the Performance Audit
of the Athletic Commission
Dear Mr. Norton:
Thank you for your letter of December 10 enclosing your
preliminary draft report. You have not provided us with a
reasonable time to respond in the manner in which we should.
As you know, the Commissioners reside in different cities
and have full- time occupations. The time available is
insufficient for us to investigate, meet, analyze and prepare
a detailed response. Nevertheless, members of your staff
were gracious enough to meet with me on December 15 and we
had a constructive meeting which resulted in revision of
the preliminary draft. The following is our comments about
the report as revised after the December 15, 1981 meeting.
1. As you know, we welcomed the performance audit and
extended ourselves to your staff. We welcome constructive
criticism and recognize the need for improvement, especially
with regard to our record keeping. Much of what appears in
the report is constructive. However, the overall impression
created is misleading. It appears that your staff believed
their mission was to find and accentuate the negative rather
than the positive, The report turns uncommon errors into
general propositions. Although we were told recently by
your staff that the report was going to state that we were
doing the best possible job with insufficient funding and
insufficient staff, the tone of the report, its point headings,
and the language used, implies a pattern of neglect. As
demonstrated below, that is not the case.
Douglas R. Norton
December 16, 1981
Page Two
2. We agree that our basic problem is, as you state,
that " presently the Commission does not have adequate staff
or funding to implement additional licensing and control
measures and medical requirements." The Commission is
effectively broke, and we rely entirely on part- time volun-teers.
Clerical assistance at the ASBAO office is extremely
limited. Our volunteers are people who participate because
of their dedication to boxing. T?. ey do not have clerical or
accounting acumen. Our record keeping is not what it should
be but it has vastly improved over what it was a few years
ago. We would welcome an accountant type to perform our
record keeping functions. He certainly could do it better
than our volunteers can. However, accountants do not volun-teer
as executive secretaries, inspectors, and deputies.
People who love boxing do.
3. It is unrealistic to expect the taxpayers of Arizona
to fund the Athletic Commission so that we can have an oper-ation
comparable to California or New York, or approaching
the ideal one envisioned by your auditors. Boxing simply
does not command that type of attention and respect in Arizona.
Presently, we have only one active promoter in the entire state
and a maximum of 12 fight cards a year. Most of the fighters
are from out- of- state and arrive en the date of the fight and
leave afterwards. The factors that you list at page 18 that
make informed licensing difficult are ever- present obstacles
and there is no remedy in the near future. A preliminary
fighter is lucky if he clears $ 300-$ 400 a year before taxes.
To require an annual physical exam ( whether he fights or
not), and sophisticated medical testing which according to
your own computation would cost at least $ 427, imposes
requirements that are not enforceable and/ or financially
unfair. If we increase bureaucracy, increase taxes, require
boxers and promoters to incur expenses they cannot afford,
we will regulate boxing out of existence. A more realistic
goal is to do what is necessary to avoid any serious ring
injury and to assure that every fighter gets paid. We
have accomplished that.
4. The omissions in statutory compliance which you
found have no direct relationship to safety. The Commission's
record on safety is exemplary. In the two and one- half years
that I have served on the Athletic Commission, I have observed
over 100 professional boxers in action in Arizona. Not one
sustained a serious injury in the ring. A1 Munoz has been on
Douglas R. Norton
December 16, 1981
Page Three
the Commission for almost six years and has observed many
hundreds of professional boxers in action in Arizona and not
one has sustained serious injury in the ring. Steve Eisner
has promoted fights in Phoenix for nine years, and of the
approximately 600 fighters that have fought on his cards, he
reports that not one has sustained serious injury in an
Arizona ring. That is not simply the result of dumb luck.
It is the result in large part of the Commission doing its job.
Our safety record would not be exemplary if the matches were
not competitive, pre- fight physicals were not meaningful,
safe equipment were not required, and referees and ringside
physicians were not performing well.
5. As mentioned above, your report accentuated the
negative and passes quickly over the positive. The achieve-ments
of the present Athletic Commission include the following:
( a) Prior to April of 1980, the statutory law
that was in effect rendered us, in the opinion of the Attorney
General, impotent to act as an Athletic Commission. We were
instructed that we would be acting ultra vires if we regulated
the conduct of boxing matches, and if we enforced our rules.
For several years the Commission operated under the dilemma
that strict enforcement of the rules would precipitate a
court challenge and a finding of illegality. Initial attempts
to enlist legislative support to change the law were
unsuccessful. When I was appointed to the Commission in
April 1979, it became our compulsion to get the law changed.
The Commission worked for over a year to get the new law
which was effective in April, 1980. I drafted the legislation
which revised all of the existing statutory law. Over a
hundred hours were spent by us in researching laws of other
jurisdictions, drafting the proposed law, appearing before
legislative committees in the House and Senate, overcoming
opposition, working out compromises. The time spent was to
the detriment of our livelihoods.
( b) When the new law became effective, it was
necessary to promulgate new rules to put the law into operation.
I wrote the rules. Again, it required expending many, many
hours. Because of all the bureaucratic red tape involved in
getting rules approved, it was not until January of 1981
that they were certified. That was the first time the Commission,
according to the Attorney General, had the legal predicates
to operate like a real boxing Commission. In that sense, we
are less than a year old.
Douglas R. Norton
December 16, 1981
Page Four
( c) This Commission is the first to insist on
accident insurance for boxers, the first to require protective
ring padding, the first to promulgate meaningful forms of
boxer- promoter contracts which are specifically designed to
illicit information addressed to safety, and the first to
require matchmakers to deliver fight programs in advance and
in writing setting forth the material facts regarding each
contestant, his physical attributes, his record, the results
and date of his last fight, and why the matchmaker thinks
the match is competitive.
( d) This Commission joined the World Boxing
Association and the World So- ing Council in an effort to
encourage world championship matches in Arizona. In the
past two years, there have been four ( nationally televised)
world championship fights in Arizona. Prior to that there
were none. Needless to say, those events are good for
Arizona's economy. We faciliated those events by refusing
( against substantial pressure) to adopt a protectionist
attitude towards local promoters, by supporting a low tax
which is competitive with other venues, and by regulating
only when required and minimizing bureaucracy.
( e) International representives at our championship
matches have been uniformly laudatory about the performance
of our Commission as compared to other commissions, and the
performance of our officials. The former Executive Secretary
of the World Boxing Association has said that our new rules
are the best in the world, and that this Commission is one
of the best he has ever seen. Many of the long- time Phoenix
and Tucson boxing people have said on numerous occasions,
publicly and privately, that before this Commission there
was anarchy, but now there is some order.
6. You conclude that " the Commission has not required
that all participants in professional boxing be licensed as
required by A. R. S. § 5- 228." The use of the phrase " not required"
implies conscious omission. A more precise statement of your
findings is that in a small percentage of cases there were
no license applications on file at the ASBAO office for boxers
who had competed in Arizona at the time the files were reviewed.
The Commission attempts to license all boxers before they com-pete.
About a year ago, we discovered that our Executive
Secretary and our inspectors, who are charged with licensing
at the weigh- in, were relying on memory in determining who
Douglas R. Norton
December 16, 1981
Page Five
needed a license. That is plainly insufficient. We then
requested that the ASBAO prepare master lists of licensees
for use at weigh- ins, and we instructed our Executive Secretary
and inspectors to ask each boxer weighing in to show his license
and to show identification before a license is issued. Those
procedures should be in force. Sometimes what appear to be
examples of fighters who have competed but have not been
licensed, may result from one of the following. First, our
Executive Secretary collects all Phoenix license applications
the day of the fight and keeps them until his next visit to
the ASBAO office which may be a week to three weeks later.
Thus, what may appear to be a situation of an unlicensed boxer,
may actually be one of an application not yet filed. Second,
there have been errors in filing by the clerical staff at the
ASBAO office which serves ten or more other commissions.
The recent situation concerning four Detroit fighters
who did not complete their license applications before they
returned home was not a common occurrence. In that case, our
Executive Secretary was not able to attend the weigh- in because
of his job and we were understaffed at the weigh- in. The money
for the licenses was collected before the fight and the licenses
were set aside and the names of the fighters filled in before
the fight. Our Executive Secretary intended to have the
applications completed after the fight but, by the time he had
completed his overseeing that the fighters were paid, the Detroit
fighters had left and were on their way home.
I assure you that the Athletic Commission attempts to
license every participant in professional boxing. The omissions
are only a small percentage of the total of those that have
been licensed. Although there is no good excuse for the
omissions, they are certainly not the rule and they do not
justify the conclusion that we have " not required" participants
to be licensed.
7. You also conclude that " the Commission has not
required that all boxing promoters pay to the State the tax
on gross receipts specified in A. R. S. 55- 235." Again, the
phrase " not required," bespeaks a conscious omission. More
precisely, what you found is that the Commission does not
maintain specific written records at the ASBAO office from
which it can be easily verified that the taxes have been
paid. I personally conduct a follow- up to see that there is
a check for the payment of taxes for every fight in Tucson.
Douglas R. Norton
December 16, 1981
Page Six
Our Executive Secretary does the same thing with respect to
the Phoenix fights. When the ASBAO 0- ffice tells him that a
check has been received, he does not make any further inquiry
of the promoter. Mr. Montano assures me that all taxes on
Phoenix fights during the last two years have been paid.
Steve Eisner, the only active promoter in Phoenix, tells me
that he has cancelled checks showing the payment of taxes
for all fights for the past two years.
Certainly, the procedure would be better if we had a
log or a ledger which listed every fight and the date the
tax was received. We will instruct the ASBAO office to do
that.
8. Bad record keeping notwithstanding, the Commissioners
provided testimonial evidence to your investigators that no
fight proceeds in Arizona without the attendance of a ringside
physician. That is the fact. There has not been a single
instance during the tenure of the present Commission in
which a fight has proceeded without the attendance of a
ringside physician. Indeed, I personally was involved in
instances in which the Commission faced a belligerent crowd
because it delayed scheduled cards until the ringside physician
arrived.
9. Several miscellaneous items. Our ringside physicians
are very well qualified. Dr. Lake, our Phoenix physician, was
recently named to the World Boxing Hall of Fame. He has
attended at over a thousand fights, professional and amateur,
in many states. Dr. Varon, our Tucson physician, has also
attended at over a thousand fights. Their examinations are
not as superficial as you make them appear. The examinations
that I have witnessed at the weigh- in include blood pressure
check, respiratory system check, visual and tactile examination
of hearing, vision, mouth, glands, abdomen, and reflexes, and
hands. I do not think urinalysis is required before every
fight. Time and expense constraints out- weigh theoretical
desirability. We have required uninalysis in the past in
important fights.
We have been attempting for over a year to work through
the Attorney General's office to get access to criminal
- records maintained by State authorities. This is particularly
important in licensing promoters and managers. Thus far, we
have not been granted the authority.
Douglas R. Norton
December 16, 1981
Page Seven
10. The implication that boxing is essentially unregulated
is a flight from reality. We pass on'proposed matches and
refuse to permit those which we do not believe competitive.
We conduct a weigh- in and a pre- fight physical. Catscans
and EEG's have been required in a few cases where we thought
it was necessary. We attempt to license all participants.
Another physical is conducted in the dressing room, equipment
is checked. We require a safe ring with protective padding.
Fights do not proceed if ringside physicians object. Fighters
who are knocked out are suspended for 30 days and notice of
suspension is sent to commissions in four other states. We
have suspended boxers permanently who have shown inability
to compete or because of age. We have denied as well as
granted licenses to promoters. We attempt to collect the
2% tax in all cases. Did the boxing promoters your staff
interviewed tell you that boxing was essentially unregulated?
They tell us the contrary, and sometimes complain about too
much regulation.
11. Some of your recommended changes are good, some not
affordable, some unenforceable, some bad for boxing. I trust
that we will have an opportunity to address them if bills are
introduced to the legislature incorporating any of your proposals.
I would appreciate your giving us notice of any such activity.
The Commission again thanks your staff for their courteous-ness
and sincerity. They are fine young men.
Very truly yours,
ARIZOAA STATE ATHLETIC COMMISSION LLw Gera Maltz, Chairman
111 South Church Avenue
Tucson, Arizona 85701
792- 3836
cc: A1 Munoz
Ray Johnson
Johnny Montano