The Alabama House recently passed HB354, the “Fantasy Sports Act,” legalizing daily fantasy sports as a game of skill, not chance. In a 48-43 vote, 21 Republicans joined Democrats and one Democrat dissented. In the midst of the heated pre-vote discussion, state Rep. Alvin Holmes said he would “out” legislators who vote no but secretly wager on sports events. The measure calls for a 6 percent tax on DFS operators’ gross revenues from Alabama players for the preceding 12 months—an estimated 6,000 that would go to the state’s General Fund.
The bill now will move to the Senate where state Senator Tom Whatley, sponsor of an earlier version, said it has a good chance of passing. However, political columnist Steve Flowers said Republicans who voted for the legislation could face a backlash. “A vote for that would be perceived among evangelical or right-wing Republican voters as a vote for supporting gambling. It can be construed that way by a political action committee,” he said.
But FanDuel and DraftKings spokesman Matt La Vorgna said, “Exhaustive research on years of data conclusively demonstrates that fantasy sports are dominated by skill. They are not chance-based games, and thus they are not gambling. The House passed a sensible, thoughtful bill that takes the best regulations in 10 other states with fantasy sports laws and crafts the right framework for Alabama.” Alabama is among 20 states known to be considering laws to legalize fantasy sports gaming. Mississippi and nine other states already passed laws allowing DFS.
Currently players cannot participate in DFS in Alabama. Last year former state Attorney General Luther Strange (now a U.S. Senator) declared that DFS is illegal and prohibited it starting May 1, 2016. He sent DraftKings and FanDuel cease-and-desist letters. Alabama’s new attorney general, Steve Marshall, said he shares Strange’s concerns.
Alabama Citizens Action Program Executive Director Joe Godfrey doubts the measure would pass legal tests. He said Alabama’s constitution explicitly prohibits gambling. However, the bill is not a constitutional amendment voters would have to decide. “I think a lot of Republicans look at it as a source of revenue. They are seeing it as a revenue stream and are convinced it’s a game of skill and not gambling,” Godfrey said. But, he added, powerful casino interests in Las Vegas and elsewhere oppose DFS, which they to be gambling, and competition.
