DFS Legislation Week In Review
It’s been a busy few days or so since our last update. Here’s what you need to know about the ever-changing legal landscape for DFS as we head into the weekend.
Overview
States with bills signed into law: Indiana, Tennessee, Virginia, Mississippi
States with bills pending signature by governor: Missouri, Colorado
States where most DFS companies do not operate: Alabama, Arizona, Hawaii, Idaho, Iowa, Louisiana, Montana, Nevada, New York, Texas (DraftKings still active), Washington
State-By-State Updates
ILLINOIS
What happened: Oh boy. Where to start? After months of deliberations focused in the state House, the Senate picked up the ball this week and pushed a bill through with a 32-22 vote. However, it remains in limbo after one of its supporters, Sen. Antonio Munoz, then filed a motion to reconsider, which prevents the bill from moving to the House.
What it means: Perhaps no situation is more fluid or cloaked in political maneuvering than the one in Illinois. It’s not definitively clear why Munoz filed the motion, and the Associated Press reported that calls to his office haven’t been returned. Legal Sports Report noted that Munoz opposed the bill in its committee vote on Wednesday before voting in favor on the Senate floor. Only those voting in support were allowed to file the reconsider motion, leading to speculation that Munoz opted to vote in favor so that he would have the ability to delay movement.
What players need to know: Keep a close eye on this situation. DFS regulation has run into substantial resistance in the state, which is a key battleground for the industry. The attorney general issued an opinion declaring DFS to be illegal gambling under state law, and both FanDuel and DraftKings have pending litigation in the state. If no bill is passed, the industry’s fate could be left up to the courts this summer. The 2016 legislature is back session on Monday and is set to adjourn on May 31, so the clock is ticking.
NEW YORK
What happened: The buzz continues to build, but we’re still waiting to see new bills introduced. State Senator John Bonacic told The Buffalo News he’s optimistic a bill will be passed before the end of the legislative session next month. Meanwhile, Assemblyman Gary Pretlow says he’s running the final draft of his House bill by state Attorney General Eric Schneiderman for review.
What it means: The mere mention of Schneiderman’s name is enough to rankle DFS advocates, but he won’t get the ultimate say in this fight. For now, we remain in wait-and-see mode in one of industry’s most pivotal markets.
What players need to know: Keep watching. We don’t have specifics on the bills right now, but it’s clear the lawmakers involved are putting in heavy legwork to get passable bills ready for introduction. Pretlow said the Assembly bill will most likely be on the Racing and Wagering Committee agenda for June 1 or 2, about two weeks before adjournment.
MISSOURI
What happened: The Small Businesses of Fantasy Sports Trade Association is urging Missouri governor Jay Nixon to veto the bill that would regulate and levy fees and taxes on fantasy sports websites in the state. “We appreciate that the Legislature wants to address this issue, but this bill will kill us,” Alex Kaganovsky, co-founder of the group, told the St. Louis Post-Dispatch.
What it means: The SB-FSTA is upset with the annual registration fee of $10,000 (or 10 percent of entry fees) and the 11.5 percent tax on revenues. It says the Legislature didn’t take into account the differences between DFS industry leaders and smaller sites that cater primarily to season-long leagues.
What players need to know: The governor’s office hasn’t offered substantive comment, but Nixon called for taxation and regulation of the industry in January, leading most to believe he’ll sign the bill into law.
COLORADO
What happened: A bill to regulate DFS is still awaiting the signature of Governor John Hickenlooper.
What it means: No cause for concern.
What players need to know: The bill was sent to the governor’s desk on May 9 and he has 30 days to sign or veto. If he takes no action, the bill automatically becomes law.
ALSO OF NOTE
— The Pennsylvania Gaming Control Board has released its Fantasy Sports Report and recommends the state apply the same regulatory oversight it applies to casinos. For those who have been following the DFS legal arena closely, this would be similar to the route taken by Nevada in 2015, which the industry has strongly opposed. The report will be presented to the Pennsylvania House Gaming Oversight committee in the coming weeks, and though the recommendation is a non-binding opinion, some are speculating it will lead to the packaging of DFS with an existing online gaming bill.
— DFS players in Mississippi are still in a holding pattern after a regulatory bill was signed into law last week. Operators are currently going through a registration process with the state, and a FanDuel representative said there’s no clear timeline for when approval will be granted.