|Photo by: BagoGames via flickr|
New regulations for online gaming which include stipulations for daily fantasy sports in Massachusetts are being said to stifle business growth.
Peter Shoenke, chairman of the Fantasy Sports Trade Association says, “The recommendations would take Massachusetts from being perhaps the best environment for our industry to being one of the most problematic.”
The Special Commission for Online Gaming, Fantasy Sports Gaming and Daily Fantasy Sports voted August 1 on the new course of action to expand legal online gaming in the state of Massachusetts. The panel voted 5-3 to pass the new regulations. Schoenke cast one of the three votes against them.
The panel led by co-chairs Sen.Eileen Donoghue (D-Lowell) and Rep.Joseph Wagner (D-Chicopee) put forth the path to which daily fantasy sports can remain legal in Massachusetts after July 2018, being taxed and regulated under Gaming Commission observation. One of the changes the panel is adopting is to make it clear that it doesn’t recommend the legalization of other online gaming forms. The Legislature may consider that other forms, such as betting on simulcast horse races and eSports, might fit the definition.
According to companies like DraftKings (based in Boston) and FanDuel, their clients play “games of skill” which is not gambling. Schoenke said, “The specter of gambling is very problematic for our industry.” James Chisholm Public Affairs Director of DraftKings said of the commission’s plan. “[It] could restrain our company’s ability to thrive and create jobs here in Massachusetts.” He further explained, “These recommendations, if ever adopted, would put us behind every other state in the country on this issue and send a troubling message to other startups.”
In 2016, the Legislature approved a vote making daily fantasy sports legal until July 2018. Regulations were designed by state Attorney General Maura Healey’s office to govern the industry as a bridge to find a permanent solution for the future.
Another source of opposition to the proposed regulations is Rep.Mark Cusack (D-Braintree). Cusack said, “[The report] doesn’t appreciate how these daily fantasy sports companies are set up, what their profit margins are, and how they’re funded -- which is venture capitalist and investor funding.” He also stated, “Investors want certainty, we had that.”
Abstaining from the vote was Assistant State Attorney Dan Krockmalnic who explained that his (Healey’s) office does agree with some aspects of the regulations; however, they are extremely uneasy about the expansion of online gaming.