Fantasy sports bill moves out of House committee

Fantasy sports bill moves out of House committee

The following article can be found in its original form at this link from the Illinois State Journal-Register:

State Journal-Register: Drew Zimmerman, April 20, 2016

A House committee voted 9-4 Wednesday to advance a bill formally legalizing online fantasy sports services in Illinois.

However, some members voting in favor of sending the bill to the full House expressed concern that adequate consumer protections be established.

In December, Illinois Attorney General Lisa Madigan determined that daily fantasy sports was illegal under state gambling law. In response, Rep. Mike Zalewski sponsored a bill to include fantasy sports participation as an exception to current law.

“This is an opportunity to create a safe place for these games to occur,” said Zalewski, D-Riverside. “We have an opportunity to pass one of the most comprehensive fantasy sports laws in the country, if not the most comprehensive.”

The Illinois Gaming Board, which would have supervising authority over all fantasy sports contests, opposes the bill due to an inability to regulate these contests when they are conducted within a participant’s home.

“We don’t see a way to prevent teenagers or children from getting their parents’ account numbers and using the Internet to gamble,” said Caleb Melamed, Gaming Board spokesman.

Rep. Ron Sandack, R-Downers Grove, who voted against advancing the bill, suggested revising the regulations so that the Gaming Board is comfortable with them before moving forward.

Cory Fox, spokesman for FanDuel, one of the country's top fantasy gambling sites, said the company uses a third-party vendor to verify players.

Dave Gerczak, co-founder of the Fantasy Football Players Championship, said that underage player participation has never been an issue on his site.

“In the entire eight-year existence of our business, we’ve never had a child ever try to register and play any of our events, so I know it sounds like it’s good to say that you’re trying to protect the 10-year-old kids going in there, but they’re not doing that, so it’s kind of an artificial issue,” Gerczak said.

House Bill 4323 limits contests to players who are 21 and over and also sets licensing fees, application fees and operator taxes on a sliding scale. The tax revenue would go to help fund education.

Gerczak said he supports the legislation because it is the only bill in the nation to distinguish between large daily fantasy companies like DraftKings and FanDuel and smaller, season-long contests like his.

He argued that smaller businesses that conduct fantasy sports don’t do enough business for the regulations imposed onto DraftKings and FanDuel to be worthwhile.

“The majority of our companies are in the hobbyist, season-long model where they draft, buy and manage a team for four months, spending maybe $100, and a number of different states are coming out and saying they don’t want to regulate them,” Gerczak said.

“I know we’re encapsulated within the bill, but we really feel like season-long fantasy sports is a totally different animal than daily fantasy sports, and other states are recognizing that.”

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