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The Journal Gazette

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Saturday, March 05, 2016 4:16 am

Senate passes regulation for online fantasy sports games

Niki Kelly | The Journal Gazette

INDIANAPOLIS – The Indiana Senate voted 34-10 Friday to establish oversight and regulations for the growing paid fantasy sports industry. 

But it will be up to Gov. Mike Pence to decide whether he signs the bill into law. 

The bill specifically says the activity doesn’t constitute gambling, which some lawmakers have questioned.

Sen. Mike Young, R-Indianapolis, said he doesn’t understand how it is any different from researching and betting directly on the outcome of a game.

In fantasy sports, players draft professional athletes and earn points for their statistics in a game. They pay entry fees and can win money depending on how their players perform.

Griffin Finan – director of public affairs for DraftKings – issued a statement thanking Indiana lawmakers for their advocacy.

"We look forward to continuing our dialogue with legislatures across the country to put in place a regulatory framework with thoughtful and appropriate consumer protections for fantasy sports players," he said.

Sen. Scott Schneider, R-Indianapolis, questioned the high fees operators must pay to the Indiana Gaming Commission under Senate Bill 339.

The Senate originally had the fees at $5,000 but the House raised it to a minimum of $50,000 initially and $5,000 each year.

Dave Gerczak, co-founder of the Fantasy Football Players Championship, said those fees will put his season-long paid fantasy site out of business in Indiana. The New York company has been around since 2008.

He said his company and other smaller fantasy sports sites had been assured by their trade association that there would be some sort of grandfather clause for existing companies or entities below a certain size.

But the bill doesn’t contain that.

"Even the $5,000 is really tough to be honest with you," Gerczak said, adding they could have to pay fees in every state. "As of seven days ago was the first time we actually realized we were getting screwed."

Sen. Ron Alting, R-Lafayette, pointed out several aspects of the legislation, including consumer protection provisions that include age verification, pre-determined prizes, independent audits of the companies and a ban on company employees playing.

Sen. Brandt Hershman, R-Buck Creek, said millions are playing paid fantasy sports now with no rules whatsoever, and compared it to the "Wild, Wild West" without the bill.

Some states, though, have chosen to crack down on the activity as illegal online gambling.

Two local senators opposed the bill – Sen. Travis Holdman, R-Markle, and Sen. Liz Brown, R-Fort Wayne.

nkelly@jg.net