Legislators discuss pros and cons of growing fantasy sports industry
08/30/2016 05:46 PM
FRANKFORT – Oversight legislation for the growing business of fantasy sports was on the table today at the monthly meeting of the Interim Joint Committee on Licensing and Occupations.
Cory Fox, counsel, for Policy and Government Affairs for Fan Duel, a web-based fantasy sports game and the largest daily fantasy sports company, told legislators that his industry is looking for oversight legislation in the commonwealth to protect not only the sports fantasy companies, but consumers as well.
“We’ve been operating in 45 states at the beginning of last fall, but we knew we wanted to put bills in place to ensure our legal clarity was there and also put in place consumer protection,” Fox said.
The question was raised about how much tax revenue is collected as a result of the growing fantasy sports enterprises.
Sen. Chris McDaniel, R-Taylor Mill, questioned Derek Hein, Manager for Government Affairs for Draft Kings, a Boston based daily fantasy sports contest provider, about what taxes are currently paid by the fantasy sports companies, and the players who win.
Draft Kings Manager for Governmental Affairs Derek Hein said that at this time, only winners who collect over a certain amount are taxed on their winnings.
“If a consumer wins more than $600 on our site, they are currently issued a 1099, and that’s what we pay currently,” Hein said. “There’s nothing in law that requires us to pay anything else.”
Sen. Damon Thayer, R-Georgetown, expressed similar concerns about fantasy sports conflicting with the state’s signature thoroughbred racing industry.
“How do you co-exist with pari-mutuel horse tracks in the states where you passed legislation,” asked Thayer.
“In other states with pari-mutuel horse racing we’ve co-existed for years,” Fox said. “The horse men and the horse tracks have been supportive of our legislation and some had some concerns, but more relating to their own business than the actual competition from fantasy sports, so it hasn’t been an issue in other states.”
Legislation which has been passed across the country include the following mandates for operators.
o Contests limited to persons 18 and over
o Ban on employee play
o No college sports
o Resources for responsible play
o Must segregate player funds from operating funds
o Include beginner games and designation of highly experienced players
The meeting was originally scheduled to take place at the Jim Beam Distillery in Clermont, but was moved to the Capitol Annex by co-chair Rep. Dennis Keene, D-Wilder, so that Democrat House members could attend Democratic House Speaker Greg Stumbo’s meeting in the House chamber concerning pensions which was boycotted by Republican members.
Thayer criticized the change of venue as partisan politics.
“I think Chairman Keene and Speaker Stumbo did a tremendous disservice to the legislative process today, and to the people of Bullitt County, and to the employees and management of Jim Beam,” Thayer said.
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