Bill Text: IA HSB198 | 2019-2020 | 88th General Assembly | Introduced


Bill Title: A bill for an act relating to sports gambling and wagering, by providing for fantasy sports contests and sports betting, providing for taxes and fees, making penalties applicable, and including implementation and effective date provisions.

Spectrum: Partisan Bill (? 1-0)

Status: (N/A) 2019-03-04 - Committee report, recommending amendment and passage. H.J. 394. [HSB198 Detail]

Download: Iowa-2019-HSB198-Introduced.html
House Study Bill 198 - Introduced HOUSE FILE _____ BY (PROPOSED COMMITTEE ON STATE GOVERNMENT BILL BY CHAIRPERSON KAUFMANN) A BILL FOR An Act relating to sports gambling and wagering, by providing 1 for fantasy sports contests and sports betting, providing 2 for taxes and fees, making penalties applicable, and 3 including implementation and effective date provisions. 4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 5 TLSB 2452YC (7) 88 ec/rn
H.F. _____ DIVISION I 1 LICENSED SPORTS WAGERING 2 Section 1. Section 99D.7, subsection 23, Code 2019, is 3 amended to read as follows: 4 23. To establish a process to allow a person to be 5 voluntarily excluded from advance deposit wagering as defined 6 in section 99D.11, from an internet fantasy sports contest as 7 defined in section 99F.1, from advance deposit sports betting 8 wagering as defined in section 99F.9, from the wagering area 9 of a racetrack enclosure and from the gaming floor and sports 10 betting wagering area , as defined in section 99F.1 , of all 11 other licensed facilities under this chapter and chapter 99F 12 as provided in this subsection . The process shall provide 13 that an initial request by a person to be voluntarily excluded 14 shall be for a period of five years or life and any subsequent 15 request following any five-year period shall be for a period 16 of five years or life. The process established shall require 17 that licensees be provided electronic access to names and 18 social security numbers of persons voluntarily excluded 19 through a secured interactive internet site maintained by 20 the commission and information regarding persons voluntarily 21 excluded shall be disseminated to all licensees under this 22 chapter and chapter 99F . The names, social security numbers, 23 and information regarding persons voluntarily excluded shall 24 be kept confidential unless otherwise ordered by a court or by 25 another person duly authorized to release such information. 26 The process established shall also require a person requesting 27 to be voluntarily excluded be provided information compiled 28 by the Iowa department of public health on gambling treatment 29 options. The state and any licensee under this chapter or 30 chapter 99F shall not be liable to any person for any claim 31 which may arise from this process. In addition to any other 32 penalty provided by law, any money or thing of value that has 33 been obtained by, or is owed to, a voluntarily excluded person 34 as a result of wagers made by the person after the person has 35 -1- LSB 2452YC (7) 88 ec/rn 1/ 21
H.F. _____ been voluntarily excluded shall be forfeited by the person and 1 shall be credited to the general fund of the state. 2 Sec. 2. Section 99F.1, subsection 1, Code 2019, is amended 3 to read as follows: 4 1. “Adjusted gross receipts” means the gross receipts less 5 winnings paid to wagerers on gambling games . However, “adjusted 6 gross receipts” does not include promotional play receipts 7 received after the date in any fiscal year that the commission 8 determines that the wagering tax imposed pursuant to section 9 99F.11 on all licensees in that fiscal year on promotional 10 play receipts exceeds twenty-five million eight hundred twenty 11 thousand dollars. 12 Sec. 3. Section 99F.1, Code 2019, is amended by adding the 13 following new subsections: 14 NEW SUBSECTION . 2A. “Authorized sporting event” means a 15 professional sporting event or a collegiate sporting event. 16 NEW SUBSECTION . 10A. “Fantasy sports contest” includes 17 any fantasy or simulated game or contest in which the fantasy 18 sports contest operator is not a participant in the game 19 or contest, the value of all prizes and awards offered to 20 winning participants are established and made known to the 21 participants in advance of the contest, all winning outcomes 22 reflect the relative knowledge and skill of the participants 23 and shall be determined by accumulated statistical results of 24 the performance of individuals, including athletes in the case 25 of sporting events, and no winning outcome is based on the 26 score, point spread, or any performance or performances of any 27 single actual team or solely on any single performance of an 28 individual athlete or player in any single actual event. 29 NEW SUBSECTION . 16A. “Internet fantasy sports contest” 30 means a method of entering a fantasy sports contest by which a 31 person may establish an account with an internet fantasy sports 32 contest service provider, deposit money into the account, and 33 use the account balance for entering a fantasy sports contest 34 by utilizing electronic communication. 35 -2- LSB 2452YC (7) 88 ec/rn 2/ 21
H.F. _____ NEW SUBSECTION . 16B. “Internet fantasy sports contest 1 adjusted revenues” means, for each internet fantasy sports 2 contest, the amount equal to the total charges and fees 3 collected from all participants entering the internet fantasy 4 sports contest less winnings paid to participants in the 5 contest, multiplied by the location percentage. 6 NEW SUBSECTION . 16C. “Internet fantasy sports contest 7 service provider” means a person, including a licensee under 8 chapter 99D or this chapter, who conducts an internet fantasy 9 sports contest as authorized by this chapter. 10 NEW SUBSECTION . 17A. “Location percentage” means, for each 11 internet fantasy sports contest, the percentage, rounded to 12 the nearest tenth of a percent, equal to the total charges and 13 fees collected from all internet fantasy sports contest players 14 located in this state divided by the total charges and fees 15 collected from all participants in the internet fantasy sports 16 contest. 17 NEW SUBSECTION . 23. “Sports betting” means the acceptance 18 of wagers on an authorized sporting event by any system of 19 wagering as authorized by the commission. “Sports betting” does 20 not include wagering on a race as defined in section 99D.2 or 21 entering an internet fantasy sports contest. 22 NEW SUBSECTION . 24. “Sports betting net receipts” means 23 the gross receipts less winnings paid to wagerers on sports 24 betting. 25 NEW SUBSECTION . 25. “Sports betting wagering area” means an 26 area, as designated by the commission, in which sports betting 27 is conducted. 28 NEW SUBSECTION . 26. “Sports wagering” means sports betting 29 and entering an internet fantasy sports contest. 30 Sec. 4. Section 99F.1, subsections 2 and 17, Code 2019, are 31 amended to read as follows: 32 2. “Applicant” means any person applying for an occupational 33 license or applying for a license to operate an excursion 34 gambling boat, or the officers and members of the board of 35 -3- LSB 2452YC (7) 88 ec/rn 3/ 21
H.F. _____ directors of a qualified sponsoring organization located in 1 Iowa applying for a license to conduct gambling games on an 2 excursion gambling boat , or an internet fantasy sports contest 3 service provider applying for a license to conduct internet 4 fantasy sports contests under this chapter . 5 17. “Licensee” means any person licensed under section 6 99F.7 , 99F.7A, or 99F.7B . 7 Sec. 5. Section 99F.3, Code 2019, is amended to read as 8 follows: 9 99F.3 Gambling games and sports wagering authorized. 10 The system of wagering on a gambling game and sports wagering 11 as provided by this chapter is legal, when conducted on an 12 excursion gambling boat, gambling structure, or racetrack 13 enclosure at authorized locations by a licensee as provided in 14 this chapter . 15 Sec. 6. Section 99F.4, subsections 3 and 22, Code 2019, are 16 amended to read as follows: 17 3. To adopt standards under which all excursion gambling 18 boat operations shall be held and standards for the facilities 19 within which the gambling operations are to be held. The 20 commission may authorize the operation of gambling games on an 21 excursion gambling boat and sports betting in a sports betting 22 wagering area which is also licensed to sell or serve alcoholic 23 beverages, wine, or beer as defined in section 123.3 . 24 22. To establish a process to allow a person to be 25 voluntarily excluded from advance deposit wagering as defined 26 in section 99D.11, from an internet fantasy sports contest, 27 from advance deposit sports betting wagering as defined 28 in section 99F.9, from the gaming floor and sports betting 29 wagering area of an excursion gambling boat, from the wagering 30 area, as defined in section 99D.2 , and from the gaming 31 floor and sports betting wagering area of all other licensed 32 facilities under this chapter and chapter 99D as provided in 33 this subsection . The process shall provide that an initial 34 request by a person to be voluntarily excluded shall be for 35 -4- LSB 2452YC (7) 88 ec/rn 4/ 21
H.F. _____ a period of five years or life and any subsequent request 1 following any five-year period shall be for a period of five 2 years or life. The process established shall require that 3 licensees be provided electronic access to names and social 4 security numbers of persons voluntarily excluded through a 5 secured interactive internet site maintained by the commission 6 and information regarding persons voluntarily excluded 7 shall be disseminated to all licensees under this chapter 8 and chapter 99D . The names, social security numbers, and 9 information regarding persons voluntarily excluded shall be 10 kept confidential unless otherwise ordered by a court or by 11 another person duly authorized to release such information. 12 The process established shall also require a person requesting 13 to be voluntarily excluded be provided information compiled 14 by the Iowa department of public health on gambling treatment 15 options. The state and any licensee under this chapter or 16 chapter 99D shall not be liable to any person for any claim 17 which may arise from this process. In addition to any other 18 penalty provided by law, any money or thing of value that has 19 been obtained by, or is owed to, a voluntarily excluded person 20 as a result of wagers made by the person after the person has 21 been voluntarily excluded shall be forfeited by the person and 22 shall be credited to the general fund of the state. 23 Sec. 7. Section 99F.4, Code 2019, is amended by adding the 24 following new subsection: 25 NEW SUBSECTION . 27. To adopt standards under which all 26 sports wagering is conducted, including the scope and type of 27 wagers allowed for sports betting and for internet fantasy 28 sports contests, to identify occupations within sports wagering 29 which require licensing, and to adopt standards for licensing 30 and background qualifications for occupations including 31 establishing fees for the occupational license. In considering 32 standards regarding the scope and type of wagers allowed for 33 sports betting and for internet fantasy sports contests, 34 the commission shall consult with interested professional 35 -5- LSB 2452YC (7) 88 ec/rn 5/ 21
H.F. _____ and collegiate sports leagues. All revenue received by the 1 commission under this chapter from license fees shall be 2 deposited in the general fund of the state and shall be subject 3 to the requirements of section 8.60. All revenue received by 4 the commission from regulatory fees shall be deposited into the 5 gaming regulatory revolving fund established in section 99F.20. 6 Sec. 8. Section 99F.6, subsection 4, paragraph a, 7 subparagraph (5), Code 2019, is amended to read as follows: 8 (5) For purposes of this paragraph, “net receipts” means 9 the annual adjusted gross receipts from all gambling games and 10 sports betting net receipts, less the annual amount of money 11 pledged by the owner of the facility to fund a project approved 12 to receive vision Iowa funds as of July 1, 2004. 13 Sec. 9. Section 99F.6, subsection 7, Code 2019, is amended 14 to read as follows: 15 7. For the purposes of this section , applicant includes 16 each member of the board of directors of a qualified sponsoring 17 organization and each member of the board of directors of an 18 internet fantasy sports contest service provider . 19 Sec. 10. NEW SECTION . 99F.7A Sports betting —— license —— 20 terms and conditions —— fees. 21 1. The commission shall, upon payment of an initial 22 license fee of fifteen thousand dollars and submission of an 23 application to the commission consistent with the requirements 24 of section 99F.6, issue a license to conduct sports betting 25 to a licensee authorized to conduct gambling games at a 26 pari-mutuel racetrack enclosure or a licensee authorized to 27 operate an excursion gambling boat or gambling structure, 28 subject to the requirements of this chapter. The annual 29 renewal fee for a license to conduct sports betting shall be 30 fifteen thousand dollars. 31 2. A licensee under this section shall include on the 32 internet site or mobile application used by the licensee to 33 conduct advance deposit sports betting wagering as authorized 34 in section 99F.9 the statewide telephone number authorized 35 -6- LSB 2452YC (7) 88 ec/rn 6/ 21
H.F. _____ by the Iowa department of public health to provide problem 1 gambling information and extensive responsible gaming features 2 in addition to those described in section 99F.4, subsection 22. 3 3. A licensee issued a license to conduct sports betting 4 under this section shall employ commercially reasonable steps 5 to prohibit coaches, athletic trainers, officials, players, or 6 other individuals who participate in an authorized sporting 7 event that is the subject of sports betting from sports betting 8 under this chapter. In addition, a licensee shall employ 9 commercially reasonable steps to prohibit persons who are 10 employed in a position with direct involvement with coaches, 11 players, athletic trainers, officials, players, or participants 12 in an authorized sporting event that is the subject of sports 13 betting from sports betting under this chapter. 14 Sec. 11. NEW SECTION . 99F.7B Internet fantasy sports 15 contests —— licenses —— terms and conditions —— fees. 16 1. The commission shall, upon payment of an initial annual 17 license fee of five thousand dollars and submission of an 18 application to the commission consistent with the requirements 19 of section 99F.6, issue a license for a period of not more than 20 three years to an applicant to conduct internet fantasy sports 21 contests in this state if the commission is satisfied that the 22 requirements of this chapter and its rules adopted under this 23 chapter applicable to licensees have been or will be complied 24 with. 25 2. A licensed internet fantasy sports contest service 26 provider shall use commercially reasonable methods to comply 27 with all of the following requirements: 28 a. Prevent employees of the internet fantasy sports contest 29 service provider and relatives living in the same household of 30 such employees from competing in any internet fantasy sports 31 contest on the service provider’s digital platform in which the 32 service provider offers a cash prize to the public. 33 b. Verify that a person entering an internet fantasy sports 34 contest who is located in this state is twenty-one years of age 35 -7- LSB 2452YC (7) 88 ec/rn 7/ 21
H.F. _____ or older. 1 c. Ensure that coaches, officials, players, contestants, 2 or other individuals who participate in a game or contest 3 that is the subject of an internet fantasy sports contest are 4 restricted from entering an internet fantasy sports contest in 5 which the outcome is determined, in whole or in part, by the 6 accumulated statistical results of a team of individuals in the 7 game or contest in which they participate. 8 d. Prohibit internet fantasy sports contests based upon 9 any contest or competition that is not an authorized sporting 10 event. 11 e. Allow individuals to restrict themselves from entering 12 an internet fantasy sports contest conducted by the internet 13 fantasy sports contest service provider upon request and take 14 reasonable steps to prevent those individuals from entering 15 any internet fantasy sports contests conducted by the internet 16 fantasy sports contest service provider. 17 f. Allow individuals to establish an account with an 18 internet fantasy sports contest service provider by utilizing 19 electronic communication. 20 g. Disclose the number of entries a single internet fantasy 21 sports contest player may submit to each internet fantasy 22 sports contest and take reasonable steps to prevent players 23 from submitting more than the allowable number of entries for 24 that internet fantasy sports contest. 25 h. Segregate internet fantasy sports contest player funds 26 from operational funds or maintain a reserve in the form of 27 cash, cash equivalents, an irrevocable letter of credit, 28 payment processor reserves and receivables, a bond, or a 29 combination thereof in the amount of the deposits in internet 30 fantasy sports contest player accounts for the benefit and 31 protection of internet fantasy sports contest player funds held 32 in internet fantasy sports contest accounts by the internet 33 fantasy sports contest service provider. 34 i. The audit required by section 99F.13 may be conducted 35 -8- LSB 2452YC (7) 88 ec/rn 8/ 21
H.F. _____ by a certified public accountant authorized to practice in the 1 state of Iowa under chapter 542 who is selected by the licensed 2 internet fantasy sports contest service provider and approved 3 by the commission. 4 j. Pay the tax as provided in section 99F.11. 5 3. The annual license fee to conduct internet fantasy sports 6 contests shall be five thousand dollars. 7 4. a. A licensed internet fantasy sports contest service 8 provider shall pay a regulatory fee to the commission. The 9 regulatory fee shall be established by the commission based on 10 the costs of administering and enforcing this chapter. 11 b. A licensed internet fantasy sports contest service 12 provider shall receive a credit for the amount of the 13 regulatory fee paid by the provider against the taxes to be 14 paid pursuant to section 99F.11. 15 c. Notwithstanding section 8.60, the portion of the fee 16 paid pursuant to paragraph “a” relating to the costs of the 17 commission shall be deposited into the gaming regulatory 18 revolving fund established in section 99F.20. 19 Sec. 12. Section 99F.8, Code 2019, is amended to read as 20 follows: 21 99F.8 Bond of licensee. 22 A licensee licensed under section 99F.7 shall post a bond 23 to the state of Iowa before the license is issued in a sum 24 as the commission shall fix, with sureties to be approved by 25 the commission. The bond shall be used to guarantee that the 26 licensee faithfully makes the payments, keeps its books and 27 records and makes reports, and conducts its gambling games and 28 sports betting in conformity with this chapter and the rules 29 adopted by the commission. The bond shall not be canceled by 30 a surety on less than thirty days’ notice in writing to the 31 commission. If a bond is canceled and the licensee fails to 32 file a new bond with the commission in the required amount on 33 or before the effective date of cancellation, the licensee’s 34 license shall be revoked. The total and aggregate liability 35 -9- LSB 2452YC (7) 88 ec/rn 9/ 21
H.F. _____ of the surety on the bond is limited to the amount specified in 1 the bond. 2 Sec. 13. Section 99F.9, subsection 1, Code 2019, is amended 3 to read as follows: 4 1. Except as permitted in this section , the licensee 5 shall not permit no sports betting or any form of wagering on 6 gambling games. 7 Sec. 14. Section 99F.9, Code 2019, is amended by adding the 8 following new subsection: 9 NEW SUBSECTION . 3A. a. For the purposes of this section, 10 unless the context otherwise requires: 11 (1) “Advance deposit sports betting wagering” means a method 12 of sports betting in which an eligible individual may, in an 13 account established with a licensee under section 99F.7A, 14 deposit moneys into the account and use the account balance to 15 pay for sports betting. 16 (2) “Advance deposit sports betting wagering operator” means 17 an advance deposit sports betting wagering operator licensed 18 by the commission who has entered into an agreement with a 19 licensee under section 99F.7A to provide advance deposit sports 20 betting wagering. 21 (3) “Eligible individual” means an individual who is at 22 least twenty-one years of age or older who is located within 23 this state. 24 b. The commission may authorize a licensee under section 25 99F.7A to conduct advance deposit sports betting wagering. An 26 advance deposit sports betting wager may be placed in person 27 in the sports wagering area, or from any other location via 28 a telephone-type device or any other electronic means. The 29 commission may also issue an advance deposit sports betting 30 wagering operator license to an entity who complies with this 31 subsection and section 99F.6 and may require the advance 32 deposit sports wagering operator to conduct an audit consistent 33 with the requirements of section 99F.13. 34 c. An unlicensed person taking or receiving sports betting 35 -10- LSB 2452YC (7) 88 ec/rn 10/ 21
H.F. _____ wagers from residents of this state is guilty of a class “D” 1 felony. 2 Sec. 15. Section 99F.9, subsection 4, Code 2019, is amended 3 to read as follows: 4 4. A person under the age of twenty-one years shall not make 5 or attempt to make a wager pursuant to subsection 3A or on an 6 excursion gambling boat, gambling structure, or in a racetrack 7 enclosure and shall not be allowed on the gaming floor of 8 an excursion gambling boat or gambling structure or in the 9 wagering area, as defined in section 99D.2 , or on the gaming 10 floor of a racetrack enclosure. However, a person eighteen 11 years of age or older may be employed to work on the gaming 12 floor of an excursion gambling boat or gambling structure or 13 in the wagering area or on the gaming floor of a racetrack 14 enclosure. A person who violates this subsection with respect 15 to making or attempting to make a wager commits a scheduled 16 violation under section 805.8C, subsection 5 , paragraph “a” . 17 Sec. 16. NEW SECTION . 99F.9A Internet fantasy sports 18 contests —— age restrictions. 19 A person under the age of twenty-one years shall not enter an 20 internet fantasy sports contest. A person who violates this 21 section with respect to entering an internet fantasy sports 22 contest commits a scheduled violation under section 805.8C. 23 Sec. 17. Section 99F.11, subsection 3, unnumbered paragraph 24 1, Code 2019, is amended to read as follows: 25 The taxes imposed by this section on adjusted gross receipts 26 from gambling games authorized under this chapter shall be paid 27 by the licensee to the treasurer of state within ten days after 28 the close of the day when the wagers were made and shall be 29 distributed as follows: 30 Sec. 18. Section 99F.11, Code 2019, is amended by adding the 31 following new subsections: 32 NEW SUBSECTION . 4. A tax is imposed on the sports betting 33 net receipts received each fiscal year by a licensed operator 34 from sports betting authorized under this chapter at the rate 35 -11- LSB 2452YC (7) 88 ec/rn 11/ 21
H.F. _____ of six and three-quarters percent. The taxes imposed by this 1 subsection for sports betting authorized under this chapter 2 shall be paid by the licensed operator to the treasurer of 3 state as determined by the commission and shall be credited as 4 provided in section 8.57, subsection 5. 5 NEW SUBSECTION . 5. A tax is imposed on internet fantasy 6 sports contest adjusted revenues received each fiscal year 7 by an internet fantasy sports contest service provider from 8 internet fantasy sports contests authorized under this chapter 9 at the rate of six and three-quarters percent. The taxes 10 imposed by this subsection for internet fantasy sports contests 11 authorized under this chapter shall be paid by the internet 12 fantasy sports contest service provider to the treasurer of 13 state as determined by the commission and shall be credited as 14 provided in section 8.57, subsection 5. 15 Sec. 19. Section 99F.12, subsection 2, Code 2019, is amended 16 to read as follows: 17 2. a. The licensee shall furnish to the commission reports 18 and information as the commission may require with respect to 19 the licensee’s activities. 20 b. A licensee under section 99F.7A or 99F.7B shall 21 promptly report to the commission any criminal or disciplinary 22 proceedings commenced against the licensee or its employees 23 in connection with the licensee conducting sports wagering 24 including advance deposit sports betting wagering, any abnormal 25 wagering activity or patterns that may indicate a concern about 26 the integrity of an authorized sporting event or events, and 27 any other conduct with the potential to corrupt a wagering 28 outcome of an authorized sporting event for purposes of 29 financial gain, including but not limited to match fixing, and 30 suspicious or illegal wagering activities, including the use 31 of funds derived from illegal activity, wagers to conceal or 32 launder funds derived from illegal activity, use of agents to 33 place wagers, or use of false identification. The commission 34 is required to share any information received pursuant to this 35 -12- LSB 2452YC (7) 88 ec/rn 12/ 21
H.F. _____ paragraph with any law enforcement entity, sports team, sports 1 governing body, or regulatory agency the commission deems 2 appropriate. 3 c. The gross receipts and adjusted gross receipts from 4 gambling shall be separately handled and accounted for from 5 all other moneys received from operation of an excursion 6 gambling boat or from operation of a racetrack enclosure or 7 gambling structure licensed to conduct gambling games. The 8 commission may designate a representative to board a licensed 9 excursion gambling boat or to enter a racetrack enclosure or 10 gambling structure licensed to conduct gambling games. The 11 representative shall have full access to all places within the 12 enclosure of the boat, the gambling structure, or the racetrack 13 enclosure and shall directly supervise the handling and 14 accounting of all gross receipts and adjusted gross receipts 15 from gambling. The representative shall supervise and check 16 the admissions. The compensation of a representative shall be 17 fixed by the commission but shall be paid by the licensee. 18 Sec. 20. Section 99F.15, subsection 1, paragraph c, Code 19 2019, is amended to read as follows: 20 c. Acting, or employing a person to act, as a shill or 21 decoy to encourage participation in a gambling game or sports 22 wagering . 23 Sec. 21. Section 99F.15, subsection 4, paragraphs d, h, and 24 i, Code 2019, are amended to read as follows: 25 d. Cheats at a gambling game, including but not limited to 26 committing any act which alters the outcome of the game , or 27 cheats at sports wagering . 28 h. Claims, collects, or takes, or attempts to claim, 29 collect, or take, money or anything of value in or from the 30 gambling games or sports wagering , with intent to defraud, 31 without having made a wager contingent on winning a gambling 32 game or sports wager , or claims, collects, or takes an amount 33 of money or thing of value of greater value than the amount 34 won. 35 -13- LSB 2452YC (7) 88 ec/rn 13/ 21
H.F. _____ i. Knowingly entices or induces a person to go to any place 1 where a gambling game or sports wagering is being conducted or 2 operated in violation of the provisions of this chapter with 3 the intent that the other person plays or participates in that 4 gambling game or sports wagering . 5 Sec. 22. Section 99F.20, subsection 1, Code 2019, is amended 6 to read as follows: 7 1. A gaming regulatory revolving fund is created in 8 the state treasury under the control of the department of 9 inspections and appeals. The fund shall consist of fees 10 collected and deposited into the fund paid by licensees 11 pursuant to section 99D.14, subsection 2 , paragraph “c” , 12 regulatory fees paid by licensees pursuant to section 99F.4, 13 subsection 27, fees paid by licensees pursuant to section 14 99F.7B, subsection 4, and fees paid by licensees pursuant to 15 section 99F.10, subsection 4 , paragraph “c” . All costs relating 16 to racetrack, excursion boat, and gambling structure regulation 17 shall be paid from the fund as provided in appropriations made 18 for this purpose by the general assembly. The department shall 19 provide quarterly reports to the department of management and 20 the legislative services agency specifying revenues billed 21 and collected and expenditures from the fund in a format as 22 determined by the department of management in consultation with 23 the legislative services agency. 24 Sec. 23. Section 805.8C, subsection 5, paragraph a, Code 25 2019, is amended to read as follows: 26 a. For violations of legal age for gambling wagering under 27 section 99D.11, subsection 7 , section 99F.9, subsection 4 , 28 section 99F.9A, and section 725.19, subsection 1 , the scheduled 29 fine is five hundred dollars. Failure to pay the fine by a 30 person under the age of eighteen shall not result in the person 31 being detained in a secure facility. 32 Sec. 24. EMERGENCY RULES. The state racing and gaming 33 commission created under section 99D.5 may adopt emergency 34 rules under section 17A.4, subsection 3, and section 17A.5, 35 -14- LSB 2452YC (7) 88 ec/rn 14/ 21
H.F. _____ subsection 2, paragraph “b”, to implement the provisions of 1 this division of this Act and the rules shall be effective 2 immediately upon filing unless a later date is specified in the 3 rules. Any rules adopted in accordance with this section shall 4 also be published as a notice of intended action as provided 5 in section 17A.4. 6 Sec. 25. IMPLEMENTATION. The racing and gaming commission 7 shall not implement this division of this Act until the date 8 the commission has adopted rules pursuant to chapter 17A 9 providing for such implementation and such rules have become 10 effective. 11 Sec. 26. EFFECTIVE DATE. This division of this Act, being 12 deemed of immediate importance, takes effect upon enactment. 13 DIVISION II 14 SOCIAL SPORTS GAMBLING 15 Sec. 27. Section 99B.45, subsection 2, Code 2019, is amended 16 by adding the following new paragraph: 17 NEW PARAGRAPH . c. A fantasy sports contest as defined 18 in section 99F.1. Notwithstanding any provision of this 19 subchapter to the contrary, a participant in a fantasy sports 20 contest shall not win or lose more than a total of one thousand 21 dollars or equivalent consideration at any time during any 22 period of twenty-four consecutive hours or over that entire 23 period. 24 EXPLANATION 25 The inclusion of this explanation does not constitute agreement with 26 the explanation’s substance by the members of the general assembly. 27 This bill authorizes sports gambling and wagering, including 28 sports betting and fantasy sports contests. 29 LICENSED SPORTS WAGERING. This division authorizes and 30 licenses sports betting and internet fantasy sports contests. 31 Code section 99F.1, concerning definitions, is amended. The 32 bill defines “sports wagering” as sports betting and entering 33 an internet fantasy sports contest and defines “authorized 34 sporting event” to include professional and collegiate sporting 35 -15- LSB 2452YC (7) 88 ec/rn 15/ 21
H.F. _____ events. The definition of “licensee” is amended to include 1 a person licensed to conduct sports betting and a licensed 2 internet fantasy sports contest service provider. Concerning 3 sports betting, the bill defines “sports betting net receipts” 4 as gross receipts less winnings paid to wagerers on sports 5 betting. “Sports betting wagering area” is defined as an 6 area, as designated by the commission, in which sports betting 7 is conducted. “Fantasy sports contest” is defined as any 8 fantasy or simulated game or contest in which all prizes and 9 awards offered to winning participants are established and made 10 known in advance of the contest, all winning outcomes reflect 11 the relative knowledge and skill of the participants and are 12 determined predominantly by accumulated statistical results 13 of the performance of individuals, and no winning outcome is 14 based on the score, or performance of any single actual team or 15 combination of such teams or solely on any single performance 16 of an individual athlete in any single actual sporting or other 17 event. An “internet fantasy sports contest” is defined as a 18 method of entering a fantasy sports contest by establishing 19 an account with an internet fantasy sports contest service 20 provider. The bill also defines “internet fantasy sports 21 contest adjusted revenues”, “internet fantasy sports contest 22 service provider”, and “location percentage”. 23 Code sections 99D.7(23) and 99F.4(22), concerning persons 24 voluntarily excluded from wagering or gaming areas, are amended 25 to include internet fantasy sports contests, advance deposits 26 wagering, advance deposit sports betting wagering, and the 27 sports betting wagering area. 28 Code section 99F.3, concerning authorized wagering under 29 Code chapter 99F, is amended to authorize sports wagering. 30 Code section 99F.4, concerning racing and gaming commission 31 powers, is amended to authorize the operation of sports betting 32 in a sports betting wagering area on an excursion gambling 33 boat which is also licensed to serve alcoholic beverages and 34 grants the racing and gaming commission the authority to adopt 35 -16- LSB 2452YC (7) 88 ec/rn 16/ 21
H.F. _____ standards under which sports wagering is conducted including 1 the scope and type of wagers allowed. The bill provides that 2 revenue received by the commission from license fees for sports 3 wagering shall be deposited in the general fund of the state 4 and revenue received by the commission from regulatory fees 5 shall be deposited into the gaming regulatory revolving fund 6 established in Code section 99F.20. 7 Code section 99F.6, concerning applicants, is amended to 8 provide that an applicant for purposes of the Code section 9 includes board members of an internet fantasy sports contest 10 service provider. The bill also provides that net receipts, 11 for purposes of determining purse agreements for horse racing, 12 include sports betting net receipts. 13 New Code section 99F.7A provides specific requirements 14 relative to the licensing, operation, and fees applicable to 15 sports betting. 16 The bill provides that the commission shall, upon payment of 17 an initial license fee of $15,000, issue a license to conduct 18 sports betting to a licensee authorized to conduct gambling 19 games at a pari-mutuel racetrack enclosure or a licensee 20 authorized to operate an excursion gambling boat or gambling 21 structure. The bill provides that the annual renewal fee for 22 a license shall also be $15,000. The new Code section also 23 provides that a licensee shall include on the internet site 24 or mobile application used by the licensee to conduct advance 25 deposit sports betting wagering the statewide telephone number 26 authorized by the Iowa department of public health to provide 27 problem gambling information and extensive responsible gaming 28 features. The bill also provides that a licensee issued a 29 license to conduct sports wagering shall employ commercially 30 reasonable steps to prohibit coaches, athletic trainers, 31 officials, players, participants, or other persons employed in 32 a position with direct involvement with such individuals from 33 sports betting under Code chapter 99F. 34 New Code section 99F.7B establishes the terms and conditions 35 -17- LSB 2452YC (7) 88 ec/rn 17/ 21
H.F. _____ of licenses issued to conduct internet fantasy sports contests. 1 The Code section provides that a license may be issued for 2 a period of not more than three years and provides that the 3 initial and annual license fee shall be $5,000. The Code 4 section also provides for the payment of a regulatory fee 5 to be set by the racing and gaming commission based on the 6 costs of administering and enforcing the new Code chapter. 7 The Code section further provides that each licensee shall 8 receive a credit for the amount of the regulatory fee paid 9 against taxes to be paid pursuant to the new Code chapter. The 10 Code section provides that a licensed internet fantasy sports 11 contest service provider shall use commercially reasonable 12 methods to prevent any employees and certain family members 13 from participating in internet fantasy sports contests on the 14 service provider’s digital platform, prohibit internet fantasy 15 sports contests on events that are not an authorized sporting 16 event, verify that a person entering an internet fantasy sports 17 contest who is located in this state is 21 or older, ensure 18 that participants in a game or contest shall not be allowed to 19 enter an internet fantasy sports contest involving that game 20 or contest, permit individuals to establish an account with an 21 internet fantasy sports contest service provider by electronic 22 communication and to restrict themselves from entering an 23 internet fantasy sports contest, perform an audit, and pay the 24 tax imposed. 25 Code section 99F.8, concerning licensee bonding 26 requirements, is amended to make such requirements applicable 27 to sports betting. 28 Code section 99F.9, concerning wagering on gambling games, 29 is amended to allow the commission to authorize gambling game 30 licensees under Code chapter 99F to conduct advance deposit 31 sports betting wagering. The bill also allows a licensee 32 under Code section 99F.7A to enter into an agreement with an 33 advance deposit sports betting wagering operator licensed 34 by the commission to provide advance deposit sports betting 35 -18- LSB 2452YC (7) 88 ec/rn 18/ 21
H.F. _____ wagering for the licensee and allows the commission to require 1 the advance deposit sports betting wagering operator to 2 conduct an audit. The bill would allow for an advance deposit 3 sports betting wager to be placed in person at a licensed 4 facility authorized to conduct gambling games or from any other 5 location by telephone or other electronic means. The bill 6 defines “advance deposit sports betting wagering” as a form 7 of wagering where an eligible individual creates an account 8 with a licensee, deposits money into that account, and can 9 use the balance within the account for sports betting. The 10 bill defines an “eligible individual” for purposes of advance 11 deposit sports betting wagering as an individual 21 years 12 of age or older who is located within this state. The bill 13 provides that an unlicensed person taking sports betting wagers 14 from Iowa residents is guilty of a class “D” felony, punishable 15 by confinement for no more than five years and a fine of at 16 least $750 but not more than $7,500. The Code section is also 17 amended to provide that a person under the age of 21 shall 18 not make or attempt to make a wager by advance deposit sports 19 wagering. 20 New Code section 99F.9A provides that a person under the 21 age of 21 shall not enter an internet fantasy sports contest. 22 A person who violates this Code section commits a scheduled 23 violation under Code section 805.8C and is subject to a $500 24 fine. Code section 805.8C is amended to reflect this violation 25 and applicable fine. 26 Code section 99F.11, concerning the wagering tax, is 27 amended. The bill provides that sports betting net receipts 28 received each fiscal year by a licensed operator from sports 29 betting shall be taxed at the rate of six and three-quarters 30 percent. The taxes imposed shall be paid by the licensed 31 operator to the treasurer of state as determined by the 32 commission and shall be credited as provided in Code section 33 8.57, subsection 5. In addition, the bill provides for a tax 34 of six and three-quarters percent on internet fantasy sports 35 -19- LSB 2452YC (7) 88 ec/rn 19/ 21
H.F. _____ contest adjusted revenues. The bill defines “internet fantasy 1 sports contest adjusted revenues” as the total of fees and 2 charges collected, less winnings, in an internet fantasy sports 3 contest multiplied by the percentage of fees and charges paid 4 by participants who are located in this state in that contest. 5 The taxes imposed shall be paid by the internet fantasy 6 sports contest service provider to the treasurer of state as 7 determined by the commission and shall be credited as provided 8 in Code section 8.57, subsection 5. 9 Code section 99F.12, concerning certain required reports 10 and records of licensees, is amended to provide that a sports 11 wagering licensee shall promptly report to the commission any 12 criminal or disciplinary proceedings commenced against the 13 licensee, any abnormal sports wagering activity, and any other 14 conduct with the potential to corrupt a wagering outcome of an 15 authorized sporting event. The bill requires the commission to 16 share any information received with any law enforcement entity, 17 sports team, sports governing body, or regulatory agency the 18 commission deems appropriate. 19 Code section 99F.15, concerning certain prohibited 20 activities and penalties, is amended to provide that current 21 prohibitions on cheating at a gambling game, claiming anything 22 of value from a gambling game with intent to defraud, and 23 knowingly enticing a person to go where a gambling game is 24 conducted in violation of Code chapter 99F also applies to 25 sports wagering. 26 Code section 99F.20, concerning the gaming regulatory 27 revolving fund, is amended to provide that regulatory fees 28 by an internet fantasy sports contest service provider and 29 by a licensee authorized to conduct sports wagering shall be 30 deposited in the fund. 31 This division of the bill takes effect upon enactment. 32 However, the bill authorizes the racing and gaming commission 33 to adopt emergency rules to implement the bill and provides 34 that the racing and gaming commission shall not implement the 35 -20- LSB 2452YC (7) 88 ec/rn 20/ 21
H.F. _____ bill until the date the commission has adopted rules pursuant 1 to Code chapter 17A providing for such implementation and such 2 rules have become effective. 3 SOCIAL SPORTS GAMBLING. This division concerns social 4 gambling authorized under Code chapter 99B. Code section 5 99B.45, concerning social gambling between individuals, is 6 amended to authorize social gambling on fantasy sports contests 7 and provides that a participant may not win or lose more than a 8 total of $1,000 or equivalent consideration in a fantasy sports 9 contest at any time during any period of 24 consecutive hours 10 or over that entire period. Current law limits wins or losses 11 on social gambling to $200. 12 -21- LSB 2452YC (7) 88 ec/rn 21/ 21
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