Florida pols push ‘light touch’ DFS bill while Pennsylvania hearing fizzles

florida-daily-fantasy-sports-legislationFlorida legislators are preparing a bill to regulate daily fantasy sports following intense lobbying by DFS operators.

On Tuesday, State Sen. Joe Negron and Rep. Matt Gaetz filed draft legislation that would require DFS operators to pay a $500k license fee, with annual renewals set at $100k. But the bill wouldn’t treat DFS as a gambling activity and contains no mention of taxation of DFS revenue.

The bill would create Section 547.01 of the Florida Statutes to define DFS operators as those offering “fantasy games for a cash prize to more than 750 members of the public.” The bill would bring DFS under the control of the Department of Agriculture and Consumer Services.

Section 547.02 would bar DFS employees from entering any contest in which the cash prize was over $5. Operators would have to impose an undefined cap on the number of DFS contests any one player can enter.

Operators would also have to employ age verification to restrict access to players 18 years or older while ensuring that individuals have the ability to exclude themselves from DFS play. Player funds would have to be segregated from operating capital and operators would have to submit to an annual third-party independent audit.

While the $500k upfront fee will likely put off smaller DFS operators, Florida’s bill represents the ‘light touch’ regulation the industry has been pushing for, similar to a proposal in Illinois and unlike Nevada, which has firmly categorized DFS as gambling. In the quid pro quo world of US politics, the $70k the Fantasy Sports Trade Association (FSTA) has donated to Florida political action committees since September appears to have paid off handsomely.

That said, it remains to be seen whether this bill will receive a favorable vote once it hits the senate floor. Senate president Andy Gardiner has sought a legal opinion on whether DFS is gambling while the US Attorney in Tampa has launched a grand jury investigation of DFS and has subpoenaed the FSTA’s board meeting minutes.

Sen. Rob Bradley, chairman of the Regulated Industries Committee, told the Tallahassee Democrat that there were three potential outcomes the legislature could take on DFS – legitimize it, regulate it or ban it – and each option would be “an uphill battle” in the dysfunctional world of Florida politics. In fact, Bradley said you could “enter the promo code ‘not likely’” for any DFS legislative decision in 2016.

Tuesday saw the second DFS legislative hearing in as many days, as Pennsylvania pols followed their counterparts in neighboring New Jersey. Pennsylvania’s meeting of the House Gaming Oversight Committee was expected to be more substantive than the New Jersey Assembly’s occasionally feisty but purely informational hearing, as Pennsylvania is closer to getting draft DFS legislation up for consideration.

But Tuesday’s affair was also largely exploratory, focusing on the current legal landscape in other states, the willingness of the state’s Gaming Control Board to add DFS to their list of responsibilities and the interminable ‘skill v. chance’ debate. The committee will hopefully get its hands a little dirtier at its next meeting on Nov. 19.