JEFFERSON CITY, Mo. — When Gov. Jay Nixon asked for a bill to regulate daily fantasy sports websites and companies, it caused a few to raise their eyebrows and shrug their shoulders. Compared to ethics reform, transportation funding and a litany of competing efforts, many thought daily fantasy would be overshadowed.
However with fewer than three days left in the session, HB 1941, a bill that would license and tax daily sports fantasy websites, is expected to reach the governor’s desk before the end of session. The Senate passed the bill Wednesday morning 20-10.
The governor’s staff worked directly with representatives from the industry to reach a compromise that neither side adores, but they both approve it enough to abide by the terms. Sen. Joe Keaveny, D-St. Louis, appreciates the fact that the executive branch and the daily sports fantasy industry came to a compromise. He only wishes they had done it sooner.
“I wish they would have done it weeks ago instead of three days left in the session, but we’re there,” he said.
The bill would enact a fee of 11.5 percent of annual revenue (gathered from Missouri residents) from FanDuel, DraftKings, or any other daily fantasy site with no cap if they wish to operate in the state. While the bill started its legislative journey in Republican hands under author Rep. Scott Fitzpatrick, R-Shell Knob, it quickly became a measure with more regulation. Fitzpatrick noted that he was not a fan of everything in his bill, including the 11.5 percent tax, after it went through some major changes in the Senate.
“While that does raise more money for the state, I didn’t like the 11.5 percent,” Fitzpatrick said. “I would have prefered to stay at ten or under, but that was a compromise. The governor’s office wanted to be at 21 and we stayed at 11.5, so I think that’s a fairly good outcome.”
However, he does approve that the fundamental part of the bill remained; it ensures that Missouri does not recognize daily fantasy sports as gambling, which would subject it to certain, more stringent federal laws. He also likes consumer protections that have stayed in the bill, specifically those that ban employees of daily fantasy sites to participate in the services, given they may have access to certain information.
Sen. Eric Schmitt, R-Glendale, voiced his displeasure of the bill on the Senate floor. He and the nine other senators that voted against it believed the regulations were still too strict, but they did not filibuster or prolong the debate to try to put up a vote.
“This is a growing market and a lot of people participate… and I just think this is a bit of an overreach at this point,” he said. “It’s a pretty burdensome series of regulations that we’re about to impose on an industry that’s catering to a particular market.”
Keaveny argues that because a lot of people are participating, over 4 million accounts in Missouri alone, that it needs some regulation.
“It’s the kind of bill that’s never going to be a unanimous vote,” he said. “There are those in my chamber that are opposed to any increase in fees
Keaveny also likes the bill’s chances in the House.
“It’s going to get some bumps and bruises, but I think we can get it done by the end of the session,” he said.
