DFS Legislation Update - June, 2016
A week after one of the DFS industry’s most significant legislative victories, the battle continues on new fronts. With a bill in New York now awaiting the governor’s signature, the bulk of this week’s action was in Pennsylvania, where a temporary setback was quickly followed with a positive development.
Read on for more info, and for updates in New York and Nevada.
Overview
States with bills signed into law: Indiana, Tennessee, Virginia, Mississippi, Colorado, Missouri
States with bills pending signature by governor: New York
States where most DFS companies do not operate: Alabama, Arizona, Hawaii, Idaho, Iowa, Louisiana, Montana, Nevada, New York, Texas (DraftKings still active), Washington
Updates
PENNSYLVANIA
What happened: Wednesday saw a flurry of action surrounding the effort to make DFS explicitly legal in the Keystone State. First, a far-reaching, 183-page amendment was attached to the HB 2150, the legislation introduced earlier this month by Rep. George Dunbar. The re-purposed bill packaged DFS with other gaming initiatives, but was voted down in the state’s House of Representatives, as many legislators took issue with a portion of the amendment that would allow liquor license holders in the state to install video gaming terminals. However, shortly after, a new amendment was introduced with the provisions for VGTs removed and it quickly passed, 115-80.
What it means: The bill now needs approval from the House Appropriations Committee before going back to the House floor. If it passes there, it heads to the Senate floor, and then on to the governor’s desk, if all goes well. The next Appropriations Committee meeting is scheduled for Monday.
What players need to know: This is good news, especially if you’re among the Pennsylvanians hoping for broad reforms of the state’s online gaming laws in addition to clear legal footing for DFS. It’s far from a sure thing that the bill crosses the finish line before the session’s scheduled adjournment of June 30, now less than a week away. But the presence of VGTs was reportedly going to be a major hurdle to clear in the Senate, so having it removed relatively early should smooth the waters ahead to some degree. For the industry as a whole, the issue is less pressing than it was in New York, because operators continue to do business in Pennsylvania and lawmakers have indicated they will continue to be able to do so, regardless of HB 2150’s ultimate fate. As for the bill itself, the DFS portion is similar to what we’ve seen elsewhere, with some good and some bad. Good: the age restriction is set at 18 instead of 21. Bad: No college sports, a regulation showing up frequently in legislation around the country. FanDuel, DraftKings and Yahoo have already announced they will cease offering college contests.
Noteworthy
New York: The bill that would clear the way for DFS to return to New York hasn’t yet reached the governor’s desk, and it could be “weeks or months” before that happens, according to the Rochester Democrat & Chronicle. Once received, Gov. Andrew Cuomo will have 10 days (Sundays excluded) to sign or veto the bill. If he takes no action, the bill will become law. A veto would be a surprise to many, as Cuomo had a hand in helping craft the final version of the bill, but a representative of Cuomo’s office told the Rochester paper that the input was technical in nature and primarily directed at making the bill more enforceable.
Unsurprisingly, New York Attorney General Eric Schneiderman has also chimed in on the bill’s passage. Daily fantasy’s most vocal opponent issued a statement indicating he plans to continue pursuing legal claims against FanDuel and DraftKings, alleging they engaged in false advertising and consumer fraud.
Nevada: You might have seen headlines this week that Nevada regulators have approved a form of DFS, but it won’t be exactly what the state’s daily fantasy fans are accustomed to. The story this week was that the Nevada Gaming Commission approved US Fantasy’s application for a gaming license. Headed by Vegas veteran Vic Salerno, US Fantasy’s version of DFS will differ a good deal from the versions offered by FanDuel and DraftKings, which have been absent from the state since they were banned by the gaming control board last September. Instead, US Fantasy will more closely resemble pari-mutuel horse racing than traditional daily fantasy. No existing DFS operator is currently pursuing licensure in the state; FantasyAces initially expressed interest in obtaining a license, but soon after reversed course.