Senate backs online ticket resale plan

The Senate tentatively approved a plan Thursday that would carve an exemption in the state's no-scalping law by permitting the online resale of tickets and taxing resellers' profit.

Members voted 45-0 to change current state law forbidding resale of tickets for more than $3 above face value.

Sponsor Sen. Fletcher Hartsell, R-Cabarrus County, said his plan would correct a years-old problem, as tickets have been resold over the Internet with few consumer protections and little regard for the law. Online purchasers have little recourse when they buy bogus tickets, he said.

“Online sales are becoming more and more of an issue,” Hartsell said. “This is a way to manage it, and perhaps control it, and gain the lost revenue from it.”

Under the measure, ticket-holders would be authorized to resell their seats for any price. But sellers would be required to give refunds if the event is canceled or if the buyer does not receive tickets on time.

Event organizers and venues would be empowered to prohibit resale of their tickets by posting notices forbidding the practice.

The bill also would give the state a share of the online scalping revenue by charging a 3 percent tax on sellers' profit.

Scalpers would still be barred from standing at event gates and trying to make an exorbitant profit on seats.

Hartsell also said officials with many major venues have told him they support the proposal.

“They have to deal with very upset individuals who come in with virtually identical looking tickets, and then they have to decide who's supposed to get the seat,” Hartsell said.

Several states have rolled back their ticket resale rules for Web transactions in recent years, as online sales have become popular. Officials have struggled to enforce prohibitions because purchasers or vendors may be out of state.

Authorizing online resales has reduced prices in many instances, said Sean Pate, a spokesman for the StubHub, a Web site that connects ticket-holders and ticket-seekers.

“When you open the floodgates and have as many people selling as possible, prices regulate due to supply and they go down,” Pate said.

Special student-only tickets for collegiate sporting events would not be covered under the online plan – a stipulation the University of North Carolina system sought because students receive tickets for free, said lobbyist Andy Willis.

“If we didn't have an exemption – and students are pretty savvy, as you well know – they could make money off of it,” Willis said.

The measure would bar the use of computer software programs that allow users to purchase event tickets en masse. Hartsell cited a number of popular Charlotte concerts, including a Hannah Montana show, where tickets were swallowed up in mere minutes, as proof a software ban is needed.

“There are programs available where folks can literally, the moment those tickets are available, buy up every ticket that exists and then resell them,” Hartsell said.

The Senate must take a final vote on the measure before it can be sent to the House for consideration.