Senate bets on fantasy sports, sends regulatory bill to House

Legislation that would regulate commercial fantasy sports games and clarify that they are legal passed the Senate on Wednesday and is headed to the House for consideration.

Senate Bill 339 declares that wagering on fantasy sports through companies like FanDuel and DraftKings is not gambling and therefore is not subject to the regulations or taxes that face casinos and horse racing.

But the bill would let the state’s casinos partner with existing fantasy sports companies to offer customized games.

The bill’s author, Sen. Jon Ford, R-Terre Haute, said his bill is about providing consumer protection and transparency to the tens of thousands of Hoosiers who spend money on the games.

 “As more Hoosiers take part, I want them to know their rights and be protected while playing,” Ford said in a statement. “SB 339 makes the process of fantasy sports fairer and more up-front for players in Indiana.”

The bill requires that game operators verify that participants are at least 18 years old, allow individuals to restrict themselves from playing, and disclose the number of paid fantasy sports games that a single game participant may enter.

Daily fantasy sites have escalated from an industry that three years ago had total entry fees in the tens of millions of dollars to one that is projected to generate $3.5 billion this year, according to Legalsportsreport.com.

Fans pay to compete and draft players for their teams—working under a salary cap—for daily or weekly games in professional basketball, football, baseball and other sports. Fans then compete against one another and can win thousands of dollars—even up to $1 million. The sites also offer rookie leagues to encourage newcomers.

Some critics have said the games are another form of gambling. Still, only two states—New York and Nevada—have moved to outright ban the games. The Illinois attorney general has also declared the games violate that state’s gambling laws, but the issue is tied up in court and lawmakers there are considering tighter regulations. Indiana’s attorney general has not weighed in.

Twenty-four states—including neighboring Illinois, Ohio and Michigan—are either regulating commercial fantasy sports or considering legislation to regulate the contests within their borders.