Small fantasy sports businesses lobby on NY bill

Small fantasy sports businesses lobby on NY bill

The following article can be found in its original form at this link from the Times Union:

Times Union: Matthew Hamilton, March 29, 2016

New trade association opposes proposed fees, taxes for industry


Small fantasy sports businesses are banding together to attempt to change legislation that would regulate their industry in New York.

The Small Business Fantasy Sports Trade Association is seeking tweaks to a bill pushed by state Sen. John Bonacic, R-Orange County, that would in addition to setting up regulatory framework for betting on daily fantasy sports impose license fees on companies seeking to operate here. The $500,000 fee is said to be far too expensive for small businesses like Alex Kaganovsky's Fantasy Football Players Championship, which he said employees three people full-time.

"How ironic would it be if legislation designed to regulate DraftKings and FanDuel would actually do so by putting the rest of the small businesses out of business?" Kaganovsky, whose company is based in New York City, said at a Tuesday news conference announcing the creation of the 35-member trade association, which came together in roughly a week.

The legislation also includes a privilege tax of 15 percent of gross revenue, something the small businesses also say is too high.
The overarching issue of daily fantasy sports regulation (and to be clear, the small businesses association include those who offer season-long games as well) was sparked after state Attorney General Eric Schneiderman sought to stop two industry titans, DraftKings and FanDuel, from taking bets from New York customers because he claims their games constitute illegal gambling.

Schneiderman's office came to agreements with those two companies last week that put on hold litigation as the Legislature considers how to regulate the industry. Yahoo subsequently came to a similar agreement with the attorney general's office.
Steve Brubaker, a consultant for the small business trade association, said members had not been contacted by the attorney general's office, and they were still operating in New York.

Members of the trade association have spoken with Bonacic and Assembly Racing and Wagering Committee Chair Gary Pretlow, D-Mount Vernon, they said, and seemed encouraged by those talks.

In a radio interview Tuesday, Bonacic said a carveout for smaller operators could be considered, though he did not go into further detail.

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