DFS Legalization Bill Introduced in Ohio Senate
In 2016, Ohio found itself in its usual spot as an important state in the United States’ presidential election. In 2017, it looks like Ohio could be the crossroads of the newest daily fantasy sports battle. Last Wednesday, a bill was introduced in the Ohio State Senate that would legalize and regulate daily fantasy sports contests.
The bill, SB 375, is sponsored by state Senators Dave Burke and Cliff Hite. As stated in the measure’s sentence-long summary, it would amend the state’s current gambling law to “to grant the Ohio Casino Control Commission the authority to regulate fantasy contests and to exempt fantasy contests from the gambling laws.”
The fantasy sports highlights begin at the end of page 9 of the 18-page bill. The legislation defines a “fantasy contest” much like we have seen it done before on both the state and federal level (federal definition coming in the UIGEA):
(1) The value of all prizes and awards offered to winning fantasy contest players is established and made known to the players in advance of the contest.
(2) All winning outcomes reflect the relative knowledge and skill of the fantasy contest players and are determined predominantly by accumulated statistical results of the performance of managing rosters of athletes whose performance directly corresponds with the actual performance of athletes in professional sports competitions.
(3) Winning outcomes are not based on randomized or historical events, or on the score, point spread, or any performance of any single actual team or combination of teams or solely on any single performance of an individual athlete or player in any single actual event.
SB 375 prescribes an initial license fee of $30,000 and a renewal fee, payable every three years, of $30,000. It also prohibits the following people from playing in fantasy contests:
- employees of a fantasy contest operator or relatives of employees in the same household (from playing on the specific site)
- athletes or referees who actually play in the real-life games
- people under 18-years of age
- people in states that explicitly prohibit fantasy sports
- those who wish to self-ban themselves from fantasy contests
The Ohio Casino Control Commission can also set rules to define who is considered a “beginning” fantasy player and who is a “highly experienced” player, definitions that one assumes would be used by the fantasy operators to mark highly experienced players in the contest lobbies so they are easily identifiable (and therefore can’t sneak up on a novice player) and to offer contests just for beginning players.
The commission, while given the leeway to dictate many rules of Ohio’s fantasy industry, would not be permitted to actually make the rules about how points are actually calculated in a fantasy contests. Rules pertaining to fantasy scoring will be up to operators, as they should, and as nobody would otherwise expect.
Also interesting is that the legislation would prohibit the use of scripts on fantasy sites unless those scripts are made available to everyone.
In a press release, Senator Burke said, “Our legislation creates state-level consumer protections for the growing number of Ohioans participating in these contests and achieves my goals for allowing Ohioans to continue to do so. This provides common sense transparency and protections for consumers.”
Burke’s and Hite’s bill stands in contrast to SB 356, introduced by Senator Bill Coley in September, which looks to classify fantasy sports contests as “schemes of chance.” It goes on to further define a “fantasy sports contest” as:
….any game or contest conducted in which an entry fee is charged, a prize is awarded, less than one hundred percent of the entry fees for a fantasy sports contest is awarded as a prize to a player or players, and the outcome is dependent, in whole or in part, upon the accumulated statistical performance of an athlete or team of athletes in a sporting event.
Such a contest would be illegal. And since fantasy operators traditionally take a piece of each entry fee, sites like DraftKings and FanDuel would not be permitted in Ohio should SB 356 become law.
In a press conference to introduce the bill, Coley said, “”When you’re taking a rake off the top, you’re breaking the law and you need to stop doing that in the state of Ohio.”
In article about Coley and his bill, Cincinnati.com wrote that Coley said he isn’t aiming to ban all daily fantasy sports, but that doesn’t make much sense. If he is being truthful, it would mean that his approved daily fantasy sites would somehow have to operate without reliable means of profit. Paying out 100 percent of participants’ entry fees as prizes doesn’t exactly sound realistic.