The New York legislature has passed a DFS bill that would make the state the seventh to regulate daily fantasy sports.
New York daily fantasy sports looks like it once again could become a reality. That’s because the New York state legislature passed a bill that would regulate daily fantasy sports in the state. The bill currently awaits a signature from Governor Andrew Cuomo, who is currently reviewing the bill.
The bill passed both the Senate and Assembly by large margins – 45-17 in the Senate and 91-22 in the Assembly. New York-based FanDuel was pleased with the bill’s passage. “The bill represents a thoughtful legislative process, where bipartisanship and willingness to compromise carried the day, and we are extremely hopeful Governor Cuomo will sign this bill.”
NY Daily Fantasy Sports Bill Details
The bill that passed the New York legislature contains a variety of consumer protections as well as requirements to operate in the third largest state.
To operate in the state, New York would require DFS sites pay a relatively large entry fee that includes 15% of gross revenue + $50,000. This sum, which would only cover the ability to operate in the state of New York, may be too steep for many smaller daily fantasy sports sites. Operators would also be vetted by the state in the licensing process. The state believes that they make as much as $5.5 million a year from DFS sites.
Like other states that have regulated this far, New York is putting a focus on consumer protections. The bill includes the following provisions.
- Daily fantasy sports sites would be barred from offering college sports contests something that many DFS sites have already done
- Segregation of player funds
- Players would be required to be at least 18 years of age
- Clearly Identify experienced DFS players
- Set limits on the number of entries a player can submit
- Protect the privacy and security of players and their accounts
Rocky Path to Legislation
NY daily fantasy sports has been on hold since the top three largest daily fantasy sports sites left the state in March. The DFS contests have been under pressure in the state since Attorney General Eric Schneiderman declared the games to be unlawful under state law.
Negotiations between top sites and New York led to settlement whereby New York would halt litigation until September and that all parties would drop their lawsuits if regulation passed before June 30th, the end of the New York legislative session.
FanDuel released an in-depth statement supporting the legislation:
Today, a fantasy sports law sports overwhelmingly passed the New York State Senate and Assembly with votes of 45-17 and 91-22, respectively. The legislation clarifies New York state laws to affirm the legality of fantasy sports and installs important consumer protections by creating a clear set of regulations fantasy sports companies must follow. The bill’s passage in New York caps an extraordinary run of national state legislative progress in the last six months, with seven legislative bodies – Colorado, Indiana, Mississippi, Missouri, New York, Tennessee, and Virginia – now passing a fantasy sports bill this year.
“New York fantasy sports fans rallied – with more than 100,000 emails and thousands of phone calls to legislators – and legislators heard them and responded,” said Nigel Eccles, FanDuel CEO and Co-Founder. “The bill represents a thoughtful legislative process, where bi-partisanship and willingness to compromise carried the day, and we are extremely hopeful Governor Cuomo will sign this bill. We decided long ago to build FanDuel in New York because it’s the sports capital of the world and a thriving home for tech startups – a natural fit for fantasy sports. Our success is due in no small part to the people, infrastructure, partnerships and opportunities here, which very few locations in the world can offer.”
“New York is the seventh state to pass a fantasy sports bill just this year– frankly a remarkable amount of progress in a short period of time,” continued Eccles. “It speaks to the popularity of our game, the passion and advocacy efforts of our fans and the immense potential states are seeing in the fantasy sports industry.”
Attorney General Eric Schneiderman also released a statement in reaction to the bill’s passage.
“As I have said from the start of my office’s investigation into daily fantasy sports, my job is to enforce the law. Today, the Legislature has amended the law to legalize daily fantasy sports contests, a law that will be my job to enforce and defend. We will nevertheless continue to pursue our claims that DraftKings and FanDuel previously engaged in false advertising and consumer fraud.”