Fantasy sports bill proves nightmarish for sponsors

"Let me be clear. This bill in no way authorizes sports betting or any other form of gambling," Saine told members of the House Judiciary IV Committee.

Committee members were skeptical, however, especially over language in the bill that defined fantasy sports as not being a form of gambling under state law and exempted operators from prosecution.

"I have a hard time with the definition of gambling and the suggestion that this is not gambling," said Rep. Deb Butler, D-New Hanover.

"This is gambling. I don't care how you cut it," said Rep. George Cleveland, R-Onslow. "Daily [fantasy] games involve chance, just like betting on the ponies."

Saine said an estimated 1.5 million people in North Carolina already play fantasy sports online, and his bill would address existing shortcomings, such as the lack of rules to prevent minors from playing or prevent shady operators from ripping off customers.

House Bill 279 would require operators to register with the Secretary of State's Office, pay an annual fee and agree to restrict participation to players 18 and over. They would also agree to ban operators from participating in the games and would segregate players' fees from company operating funds.

"This just addresses the reality in this state," Saine said. "Without it, it's the wild, wild West."

Christopher Grimm, a representative for fantasy sports giants Fan Duel and Draft Kings, reiterated Saine's position, noting online fantasy games have operated in North Carolina since 2012 without any regulations. He also dismissed the notion that fantasy leagues are gambling.

"You're using your skills to evaluate matchups," Grimm said. "There's no flip of a card, no roll of the dice. This is about your abilities."

North Carolina Family Policy Council President John Rustin and Rev. Mark Creech, executive director of the Christian Action League, argued that daily fantasy sports is gambling.

"The elements of chance predominate over elements of skill in these games," Rustin said. "This would be a massive expansion of legalized gambling in North Carolina."

He also criticized the enforcement mechanisms included in the proposal as too meager.

Rep. Harry Warren, R-Rowan, was able to get the committee to amend the bill to include creating a North Carolina Gambling Commission that would oversee fantasy sports, boxing and the lottery. But when Rep. Bert Jones, R-Rockingham, proposed another amendment to drop the language that fantasy sports isn't gambling, Saine and his co-sponsors simply withdrew the bill from consideration.

This is the second defeat for House Bill 279 and likely kills it for this legislative session. Last May, the House Regulatory Reform Committee voted against the measure.