Fantasy sports bill faces long odds in state Legislature

TALLAHASSEE — The odds have gotten worse for a bill in the Florida Legislature to declare betting through fantasy sports is legal as a game of skill, instead of wagering.

Key state senators say they are increasingly hesitant to make any moves affecting the status of daily fantasy sports games because the state is in the middle of complex negotiations with both the Seminole Tribe of Florida and parimutuel wagering companies over what forms of gambling should be allowed.

In the past two weeks, both the tribe and lobbyists for horse racing and dog tracks have become increasingly vocal in objecting to daily fantasy sports as a form of gambling that affects their businesses. That has caused some legislators to proceed cautiously with a bill introduced in the House and Senate to legalize fantasy sports.

"It is now part of the overall gaming conversation," said State Sen. Rob Bradley, a North Florida Republican who is the Senate's lead negotiator on a new gaming deal with the Seminole Tribe. "You can't talk about fantasy sports in a vacuum."

Senate Majority Leader Bill Galvano, R-Bradenton, said given the "litigious nature" of the gaming industry, it's clear if one area of the industry is tweaked, it affects the state's whole gaming landscape.

"It is all very much related," Galvano said.

The concerns are being voiced even as a bill that would legalize the games cleared its first committee hearing in the House earlier this week.

The bill, sponsored by Rep. Matt Gaetz, R-Fort Walton Beach, easily passed the House Business and Professions Subcommittee. It would require companies that offer season-long and daily fantasy sports games to 750 or more people per year to pay $500,000 to register with the Florida Department of Agriculture and Consumer Services. The measure would also require them to bar minors and employees of fantasy sports operators from participating in games they offer. Most importantly for the industry, it would declare fantasy sports are not to be regulated under Florida's gambling laws.

But while that bill makes headway in the House, a similar bill by Sen. Joe Negron, R-Stuart, has not budged in the Senate where it has to pass through three committees. Negron has garnered enough support from colleagues to become the next Senate president, but that won't necessarily help his fantasy sports bill.

The bill's first stop in the Senate is the Regulated Industries committee, chaired by Bradley. On Wednesday, that same committee will hold a "workshop" on a proposed $3 billion gambling compact that Gov. Rick Scott negotiated with the Seminole Tribe in December. The deal has to be signed off on by the Legislature, but lawmakers have already suggested that a final deal is not likely until 2017.

Florida is hardly alone in debating how to handle the proliferation of daily fantasy sports games.

Companies like DraftKings and FanDuel advertise daily and weekly fantasy sports leagues where participants pay an entry fee to draft football or baseball players for hypothetical sports teams. The real game statistics from those players are compared to other entrants for a chance to win prizes. In ads, both companies say they have billions of dollars in prize money to give out.

Late last year, however, Nevada became the sixth state to bar daily fantasy sports games from operating without a gaming license. And in New York the state attorney general has been fighting to shut them down. Attorneys general in Texas and Illinois are also investigating if the games should be allowed.

In Florida, the industry is in a gray area, so much so that some daily fantasy sports companies including the nation's third largest, Yahoo, refuse to allow Floridians to play the games, even while others like FanDuel and DraftKings accept them.

The Fantasy Sports Trade Association has argued that the daily games are contests of skill, not chance, a typical designation in determining whether something is a form of gambling.

While the Florida Legislature questions whether the games should be legal, gambling organizations that worry about missing out on a share of a new line of business say there is no doubt how to classify fantasy sports sites.

"Let's not kid ourselves, this is gambling," Marc Dunbar, who represents Gulfstream Park Racing and Casino in Hallandale Beach, told the House Business and Professions Subcommittee committee last week before it passed the House version of the bill that would legalize the games. Dunbar's testimony came just a week after a top official with the Seminole Tribe gave a similar assessment at a gambling conference in Orlando

"It's hard for me to understand how anybody doesn't think it's gambling," James Allen, CEO of Seminole Gaming, said during a speech at the Florida Gaming Congress.

Contact Jeremy Wallace at jwallace@tampabay.com.