Mass state Senator Eileen Donoghue has introduced a bill that would regulate daily fantasy sports, replacing the temporary legalization that sunsets in July. The Legislature’s Committee on Economic Development and Emerging Technologies will begin holding hearings this week.
Donoghue is sympathetic to what she calls a “home-grown industry,” (the two largest companies, FanDuel and DraftKings, are based in Boston) and wants to create a growth medium that will help them thrive—while protecting consumers and giving the state its cut.
DraftKings recently announced it plans to hire 250 more employees to add to the 425 it currently employs, and that the great majority of those jobs would be in Boston.
In 2016 the legislature passed a temporary fix that will expire July 31. Donoghue’s bill would, while putting DFS under the umbrella of the Massachusetts Gaming Commission (MGC) exempt it from the definition of illegal gambling.
Providers would be required to register with the MGC and pay a fee of $100,000, then pay an additional 15 percent. The state’s casinos pay 25 percent of their revenues.
Donoghue explained the relatively low registration fee: “They operate on much smaller margins. When we looked at it in preparing the bill, it seemed reasonable.”
DraftKings issued a statement praising the proposed legislation for providing “critical legal certainty” for the industry.
The statement said, “We continue to review the bill’s full implications, and look forward to discussions with her, the legislature and the governor as we adopt common sense legislation that protects consumers and allows us to continue to innovate and create jobs in Massachusetts.”
Michael Sweeney, director of the Massachusetts State Lottery, testified before the committee, attempting to piggy back onto it a provision to allow the lottery to sell tickets online as well as send promotional material to DFS providers.
The senator’s bill does not address online gaming or e-sports but does mention that possibility that sports betting may become legal nationwide if the U.S. Supreme Court lifts the ban that currently applies to all but four states. A decision in Christie v. National Collegiate Athletic Association is expected within weeks, the lawsuit challenging the 1992 Professional and Amateur Sports Protection Act (PAPSA) was brought by New Jersey.
Her bill would create a special commission to study the ramifications of PAPSA being thrown out and suddenly states can go their own way. The commission would be required to submit a recommendation to the legislature within 120 days of such a decision.
