DES MOINES — Lawmakers are considering a proposal that would legalize fantasy sports wagering, including on popular daily fantasy sports websites such as DraftKings and FanDuel.
The legislation establishes taxes and fees and places daily fantasy sports wagering under the purview of the Iowa Racing and Gaming Commission, which also regulates casinos in the state.
Rep. Jake Highfill, R-Johnston, said Tuesday at a hearing on the proposal that stakeholders have provided input in crafting the legislation, which attempts to address an issue in fantasy sports that state lawmakers have wrestled with for at least the past four years.
“The concessions both sides have made have been good,” Highfill said.
Fantasy sports is a multibillion-dollar industry nationally, and daily fantasy sports have become immensely popular. TV commercials for DraftKings and FanDuel played repetitively during this past fall’s professional football season.
Nevada and New York have banned the daily fantasy sports websites. Illinois Attorney General Lisa Madigan determined daily fantasy sports betting is illegal there, too, but a bill is pending in the Illinois General Assembly that would allow it. Virginia on Monday became the first state to pass a law that legalizes and regulates the sites.
Representatives of DraftKings and FanDuel, as well as the Fantasy Sports Trade Association, expressed their support for the Iowa proposal at the legislative hearing Tuesday at the Iowa Capitol.
Many casinos and social advocacy groups expressed opposition.
Casino representatives applauded placing fantasy sports wagering under the state gaming commission but want legislation that calls for equal taxation and regulation of online wagering and brick-and-mortar casinos. They said the proposal taxes online wagering at a lower rate and does not require sites to donate a portion of proceeds to non-profits, which is required of casinos.
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“If you subscribe to the belief that tax policy does drive behavior, this clearly is a disadvantage for existing casinos,” said Jeff Boeyink, who represents Wild Rose Entertainment, which has casinos in Clinton, Emmetsburg and Jefferson.
Others said they oppose the bill because of the possibility it could increase gambling addiction in Iowa.
More than one in five Iowa fantasy sports players are considered at-risk gamblers, according to a study being prepared by the University of Northern Iowa’s Center for Social and Behavioral Research for the state Department of Public Health. The full report will be published in May.
“This will lead to more gambling addicts, more gambling addiction, and we do very little in the way of helping with those addictions in the state of Iowa,” said Rep. Dan Kelley, D-Newton.
Sen. Jeff Danielson, D-Cedar Falls, who has worked on similar legislation, said he thinks it is crucial to classify fantasy sports as a game of skill, not chance, and regulate it as such. Danielson said he likes what he has seen of the House proposal and hopes the state can pass something.
“But if I could predict that, I’d be in Vegas,” Danielson joked.