The Massachusetts Gaming Commission is set to tackle the issue of daily fantasy sports on Thursday.
Before the planned MGC meeting, the DFS industry has mostly been discussed in the commonwealth via the media and the public, other than a review conducted by attorney general Maura Healey that determined that DraftKings and DFS operators are legal under state law.
What are we likely to learn on Thursday? It could set the tone for how DFS is handled in Massachusetts moving forward.
What the MGC has already said
Over the past month, Massachusetts has been one of the most vocal states, in terms of public officials commenting on DFS. A lot of that stems from the location of DraftKings, which is headquartered in Boston. Key legislators, the mayor of Boston, the governor of Massachusetts and Healey have all made some sort of public comment about DFS in the past month.
That also includes MGC Chairman Steve Crosby, who last week announced his intention to consider the DFS industry at an open meeting (full statement here, meeting agenda here). Here is what the MGC posted on its website:
In response to multiple indications of interest from senior public-policy makers seeking the Commission’s assessment of the complex issues associated with fantasy sports, I have directed MGC staff to prepare for the Commission’s first conversation on this topic at our next public meeting on Thursday, October 29th. At that time, the Commission will begin to determine its views on the broad-based public policy questions that out policy makers will need to address: First, are fantasy sports legal? The Attorney General and others have already spoken to this issue. Second, if it is legal, should it be regulated? Third, if it should be regulated, who should be the regulator? And finally, if it is regulated, what are the critical variables that should be addressed by regulation?
In no case will our opinions be dispositive. The final decisions rest with the Legislature, the Governor, and perhaps the courts. But given the make-up of our Commission and staff, and the extraordinary public policy-making process of our past three and a half years, I believe the Commission will be able to provide constructive advice on the complex issues raised by the meteoric emergence of online fantasy sports.
The live stream of the meeting can be seen here.
Forecasting what the MGC might say
As the MGC notes, its opinions will not be “dispositive,” meaning what it puts forth is not the end of the discussion, but more like the beginning.
In many cases, actual regulations for gaming in states are not crafted directly into legislation; the details of how to regulate a given sector are generally left up to each state’s gaming commissions.
It seems extremely unlikely that the gaming commission, by putting DFS on its agenda, will simply say that the industry should go on with the status quo of an unregulated environment, although that is at least a possibility. What the MGC says will likely be a signal to policy makers in Massachusetts about how it believes the state should proceed with legislation.
In the past day, there’s also the added wrinkle of the industry’s new attempt to self-regulate, via the Fantasy Sports Control Agency that was announced on Tuesday. How much that might enter into the equation is unclear at this point, given that it was just announced and the fact that the details of how the FSCA will be implemented still need to be worked out.
There’s also the possibility that despite the AG’s opinion the MGC may weigh in on the the legality of DFS on a larger scale. In its statement about the meeting, the phrase “perhaps the courts” likely alludes to reported federal and state investigations into the DFS industry.
There’s also the matter of Nevada’s gaming commission saying that DFS is gambling, a move that has been reverberating through many jurisdictions. How that might play into the MGC’s thinking might also be revealed.
What everyone else in Massachusetts wants
It’s been made clear by several public officials that they believe something should be done about the industry, beyond “nothing.” Even after the announcement of the FSCA, Healey was already doubting a self-regulatory scheme would be adequate, according to the Boston Herald:
“Clearly this is an industry that has needed regulation and controls, and that’s important,” Healey told the Herald. “I don’t know enough of what it is they’re proposing. (But) I highly doubt that I would be satisfied, as a consumer protection matter, trusting or relying on that industry to regulate itself.”
Healey also indicated that she wants to hear what the MGC has to say:
https://twitter.com/GarrettQuinn/status/656928080238399493
House Speaker Robert DeLeo and Senate President Stan Rosenberg have both already indicated they believe the industry needs to be regulated and taxed. Gov. Charlie Baker has generally deferred to the rest of the Massachusetts government in setting the tone of the discussion, but also wants to hear the MGC’s opinion.
BostInno put together a good look at what the AG and the legislature could do, in broad strokes. The AG’s powers included the ability to institute changes in how DFS sites operate from a consumer protection standpoint. Beyond that, however, change would have to come from lawmakers.
This is much is clear: Whatever happens on Thursday will set the stage for what happens next for DFS in Massachusetts.
