Could Daily Fantasy Sports Leapfrog Online Gambling In Pennsylvania?

June 10, 2016
PA DFS bill online gambling Pennsylvania

An effort to legalize and regulate daily fantasy sports picked up steam in Pennsylvania this week, with the possibility that a bill could breeze ahead of online poker and gambling in the state.

The DFS bill finally surfaces

Things started developing quickly this week. The House Gaming Oversight Committee received a report on daily fantasy sports, and Rep. John Payne said during that meeting that a bill would be voted on next week.

That bill didn’t exist until this week, when Rep. George Dunbar introduced it on Thursday.

The bill sets up oversight of the industry via state governement and sets up consumer protections for fantasy sports players. A DFS operator that wants to offer contests in the state must pay the lesser of $50,000 or 7.5 percent of net revenue generated by an operator from users in Pennsylvania, in order to acquire a license.

Revenue from licensed operators is also taxed at a rate of 5 percent.

What happened to online poker?

It had appeared that online gambling had a bit of momentum in the legislature, as a part of a larger gambling expansion package.

However, a plan to vote on that expansion this week, and iGaming as well, has been delayed. It’s not clear when it might come up again, but the expansion package is being discussed as a revenue generator during budget talks in the state.

There’s a chance that the DFS bill gets lumped in with online poker and gambling, but it may also remain a standalone bill. Despite being put under the PGCB’s control, DFS is specifically exempted from gambling laws in the state.

Casinos = opposition?

It’s not clear how casinos in the state will receive the bill. In Illinois and New York, gambling interests have cropped up as opponents of DFS legislation, if it doesn’t tie the industry to currently licensed gambling establishments.

Rush Street Gaming is one of the companies behind the opposition in those states. It obviously also has a presence via a pair of PA casinos: Sugarhouse in Philadelphia and Rivers Casino in Pittsburgh.

While the bill allows licensed entities to get involved with DFS, it does not mandate offering contests through a current licensee.

Will the casinos take exception in PA, as well? That remains to be seen.

Either way, except more movement on the DFS legislation in the near future.

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