Regulators in Colorado could finally remove much of the uncertainty surrounding daily fantasy sports in the state if the Division of Gaming defines rules for the activity.
The Colorado Department of Revenue will host a “rulemaking hearing” for the CO Division of Gaming on Oct. 30 to possibly add language to regulate DFS. The state legalized DFS in 2016, but the statutes have very little definition or rules in the regulations about the subject. For years, DFS operators in Colorado have operated under a murky set of guidelines.
What are the issues behind the regulation of DFS in Colorado?
The lightly-regulated nature of daily fantasy sports in Colorado has led to many practices that do not exist in other states.
For example: DraftKings Colorado and FanDuel Colorado, leaders in DFS, can use the word “free” to describe promotional offers in their advertising in Colorado. In addition, “parlay-style” fantasy bets have been offered in the state, something typically only sportsbooks are allowed to do. Proposed language to be discussed at next week’s rulemaking hearing would change that.
A fundamental change could occur if the Division of Gaming votes to approve language to define what DFS is. That would narrow the definition of DFS as any contest that demands “an entry fee, offers a prize, and is based on the statistics of multiple athletes,” according to language proposed by a special commission.
A change to props in DFS would require any props fantasy offering to pit athletes from two different teams. A DFS winner would be determined by the stats recorded by only those two athletes.
Responsible gaming in Colorado is also at issue for DFS operators. The hearing is expected to include discussion of requiring DFS companies to include Colorado’s 1-800-GAMBLER helpline number and possibly other RG language.
Workshop for feedback held with DFS operators
In September, the state of Colorado held a workshop that included several DFS operators. From that workshop many ideas were culled to assist regulators in drafting new guidelines. Many of the proposed changes would not be unusual for DFS operators, who are used to such requirements in other states where they are in the industry, such as Michigan and New York.
In fact, both DraftKings and FanDuel issued detailed statements in response to proposed rules changes. In many cases, the DFS operators requested clarification on daily fantasy sports definitions and contest types.
Citizens can view the public hearing on Oct. 30, via a Webex link at the state website. The rulemaking session is scheduled for 9:15 a.m. MT. The public can also attend the meeting in person at the Pikes Peak Conference Room, located at 1707 Cole Blvd. Suite 300, in Lakewood.