Friday, Feb 23, 2018
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Lawmakers vote to expressly legalize fantasy sports games

COLUMBUS — A bill likely to reach Gov. John Kasich’s desk before year’s end would regulate for-profit fantasy sports operations like FanDuel and DraftKings for the first time in Ohio.

The Ohio Senate on Wednesday voted 25-4 to subject such operations to licensing, investigation, regulation, and potential discipline by the same state entity that watches over the casino industry. But at the same time the bill expressly states such efforts are not gambling, an attempt to clear the haze under which the typically online industry currently operates in Ohio.

Small unregulated office pools and games for football and March Madness in which every penny taken in is paid out in prizes would not be subjected to the new law.

The chamber rejected the idea of subjecting the industry to a new tax. Sen. Bill Coley (R., West Chester), who opposed the bill, proposed a 6 percent tax to help the state cover the costs of addiction and other social problems that he said would come, regardless of the fact that the bill says fantasy sports to be gambling.

“You get no jobs, no development,” Mr. Coley said. “You’re getting the money sent out of state electronically, and you get nothing for Ohio.”

He compared it to the 33 percent tax on wagers paid by casinos, the higher rate paid by racetrack slots parlors, and the profits from the lottery that are directed to K-12 education.

The operators would pay the commercial activity tax on business gross receipts, currently 0.26 percent.

Sen. David Burke (R., Marysville), whose district stretches north to Sandusky Bay said leaving the industry unregulated poses risks to Ohioans.

“There are two industries thus far that control the majority of this market ...” Mr. Burke said. “If they should act in a bad fashion, I don’t believe our friends and neighbors have a place of relief, of remedy.”

House Bill 132, sponsored by Reps. Jonathan Dever (R., Madeira) and Robert McColley (R., Napoleon), must return to the lower chamber as soon as next week. The House overwhelmingly approved the bill on its first pass in May. The chamber has just two session days left before it plans to recess for the year.

The bill defines “fantasy contest” as a simulated game that charges an entry fee and in which all prize amounts are known in advance. Players use their statistical knowledge to draft and play athletes for their own teams with winners determined by how well those individual players perform in real games.

The Ohio Casino Control Commission, created by the passage of the 2009 constitutional amendment that legalized four casinos, will serve as watchdog over the industry. The measure is supported by the industry, which would subject itself to regulation and licensing fees of up to $10,000 a year in exchange for clearly legal status in the state.

All members of northwest Ohio’s current delegation supported the bill.

Contact Jim Provance at jprovance@theblade.com or 614-221-0496.

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