Indiana state Rep. Alan Morrison has been one the lawmakers in the U.S. who has been thinking about the daily fantasy sports industry longer than most.
He first introduced a fantasy sports bill in January of last year, seeking to allow the state’s racinos to offer fantasy competitions. That bill did not gain traction, but in the wake of regulatory efforts in other states, Morrison has introduced a new bill seeing to oversee the DFS industry.
Morrison even offered to have FanDuel move its U.S. headquarters from New York — where there are ongoing legal issues — to Indiana.
Morrison recently spoke to Legal Sports Report about his bill:
Regulating vs. not regulating
LSR: We talked before, and you said at the time you weren’t interested in regulating the industry. Can you tell me how you got to introducing this bill?
Morrison: One of the things I’ve certainly learned in my four years up here now is when it comes to matters of policy, it is certainly best to enter things with an open mind and be willing to listen to all sides involved. Obviously when it comes to your moral compass, that doesn’t move, but you can certainly see how things can change policywise.
Talking with some others in the state and some folks within the industry, and within our gaming industry — which is separate from the fantasy sports side of things — we thought the best way to proceed forward for Indiana was to come up with a legislative package of consumer protections and a state agency that basically will be the watchdog for that.
We put together, I think, a good grouping of regulations and consumer protections that are endorsed by the industry and also produced by us here in the state. And I think we are moving forward with a pretty nice piece of legislation.
Gaming interests in Indiana?
LSR: The first time you introduced legislation, your bill was pointed at the gaming industry, and allowing them to get involved with fantasy sports. Are they on board with this, in your discussions?
Morrison: They are a part of it. We will still implement a lot of the parts of the bill that our brick and mortar facilities in the state will be able to either partner with sites or run their own daily fantasy sports contests, if they wish. We thought it was important, obviously, for them to be a part of this entertainment source as well.
I think both sides are interested. I know there are daily fantasy sports sites that are interested in it, and it’s not the big names of DraftKings or FanDuel, but it’s some of the two-dozen plus [companies] out there doing business. There will be a couple of those smaller ones that will certainly take the offer.
And there have been some of our licensed facilities here in the state that have certainly shown some interest in possibly adding that (fantasy sports) to some of the different products they offer.
A level playing field?
LSR: The bill as written only has a $5,000 fee to operate in the state. It seems like you are definitely looking to make it easy for sites to take players in Indiana.
Morrison: We didn’t want to set up barriers to entry for the smaller businesses. And FanDuel and DraftKings were on board with that. They could certainly have come in and tried to flex their muscle and said “No, make it more expensive so it’s only us.” But they were not interested in that; they want to see the industry grow as a whole.
I think the registration fee keeps in line with the philosophy of doing business in Indiana, which is to make it as easy as possible for companies to move here and grow and prosper.
Revenue vs. regulation
LSR: On the flipside, is the revenue being generated in line with the regulation and oversight that the bill creates, and the resources that the Horse Racing Commission will have in dealing with fantasy sports?
Morrison: I think there is, and that’s another conversation we’re going to continue to have with the Horse Racing Commission.
But we believe with the number of daily fantasy sports sites that will register in the state of Indiana and the amount of regulation and oversight that it will take, I think we’ll be okay housing that in the Horse Racing Commission, and not having to grow government so to speak by adding multiple employees. I think we’re in line there.
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