Rocky Mountain High For Daily Fantasy Sports: Colorado Bill Heads To Governor

Written By Dustin Gouker on May 9, 2016
Colorado daily fantasy sports bill passes

[toc]Colorado became the fifth legislature this year to pass a bill regulating daily fantasy sports, sending the legislation to the desk of Gov. John Hickenlooper.

What happened with the Colorado DFS bill

The House concurred with the amended Senate version of H 1404 on Monday by a vote of 45-19. On Friday, the Senate passed the bill 26-7.

While Legal Sports Report understands the bill has hit a few more hiccups than legislation in other states, there is no reason to believe Hickenlooper would veto it.

Because the bill will be sent to Hickenlooper during the last 10 days of the session, he has 30 days to sign or veto the bill, or it becomes law automatically.

The DFS legislation moved quickly through the legislature after being introduced in late March.

Inside the Colorado DFS bill

The Colorado bill has gone through several amendments, but in many ways, it looks much like bills that have passed in other states.

Unlike other bills, the Colorado bill contains language specifically covering smaller fantasy sports operators. The bill defines small operators as any site that has fewer than 7,500 active Colorado users. These sites must register with the state, but do not have to be “licensed.” They also do not need to go through an annual audit.

Given the user requirement, it’s not clear that anyone other than DraftKings, FanDuel and Yahoo would have to be licensed or audited.

Here’s what ended up in the bill, as passed:

  • The Division of Professions and Occupations in the Department of Regulatory Agencies oversees the daily fantasy sports industry.
  • The director of the DPO is responsible for promulgating rules for licensing of DFS operators.
  • The DPO is responsible for setting licensing and renewal fees.
  • The director may issue subpoenas to compel witness testimony or gather evidence.
  • Operators that are not classified as “small” must contract with a third party to perform an annual audit.
  • In addition to online, fantasy contests may be offered “at licensed gaming establishments, class B horse racing tracks, and at a licensed facility at which pari-mutuel wagering may occur.”
  • Consumer protections are a part of the bill, including a prohibition on play by operator employees; making operators take steps to make sure data that could affect contests is secure; forces operators to segregate player funds from operating funds; allowing players to restrict themselves from playing; and distinguish experienced and beginner players.
  • A maximum number of entries is set for contests, as the lesser of 3% of all entries or 150 entries.
  • Amateur sporting events — including college sports — are prohibited.
  • A minimum age of 18 is set for DFS users.

The bill takes effect on August 10.

Colorado is latest to join DFS regulation craze

So far, three state legislatures have turned DFS bills into law:

In Massachusetts, Attorney General Maura Healey instituted consumer protections under the powers of her office, as well.

Mississippi is poised to join all those states, if Gov. Phil Bryant signs a bill on his desk this week.

Here is a look at other states that have advancing DFS legislation.

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Dustin Gouker

Dustin Gouker has been a sports journalist for more than 15 years, working as a reporter, editor and designer -- including stops at The Washington Post and the D.C. Examiner.

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