Daily fantasy sports may soon become a regulated industry in New Jersey after the state Legislature passed on Friday a bill that authorized the licensed provision of this type of service. The bill now needs one final approval from Gov. Chris Christie.
The bill had previously gained the necessary support in the state Assembly and was voted in the affirmative by Senators on Friday. Under the bill, interested DFS operators will be able to apply for a license and to either operate alone or in a partnership with local casino and racetrack operators.
Licensed businesses will have to pay an annual tax of 10.5% on winnings. It is believed that New Jersey’s DFS market could contribute around $6.6 million in taxes to the state.
The move came at a time when New Jersey is desperately looking for revenue sources to boost a scanty budget. However, Sen. James Whelan told local media that the measure was not that much intended to provide additional revenue, but to protect those playing daily fantasy sports.
DFS has enjoyed growing popularity in the United States over the past several years. However, with the exception of several states, DFS contests have been held in an unregulated environment.
Generally speaking, this type of offering allows people to create fantasy sports teams by picking real players and to place their wagers on the outcome of the contests based on the performance of those players. Under New Jersey’s DFS bill, high school sports games and players will be prohibited from being used in DFS contests.
It is yet to be seen whether Gov. Christie will approve the measure. New Jersey’s top official has been a staunch supporter of the legalization of sports betting in the state, but has not stated his opinion on daily fantasy sports.
Speaking of sports betting, New Jersey received good news earlier this week as the US Supreme Court announced its decision to hear the state’s appeal of a 1992 law that prohibited betting on sports at a federal level.
New Jersey’s quest to offer legalized sports gambling spans several years back. In 2011, state residents approved the legalization of this type of service in a statewide referendum. The vote resulted in a sports betting law being approved in the Legislature. However, multiple legal challenges have prevented it from taking effect.
The matter was eventually brought to the Supreme Court in early 2017. The nation’s highest court said in January that it would first want to hear the US Solicitor General’s opinion on the matter before deciding whether it would proceed with hearing the appeal. That turn of events was seen as a good sign by many as the court could have declined any further action on the case back then.
In May, the US Solicitor General recommended that the Supreme Court should not take up the case. It is once again interpreted as a good sign that the court has after all decided to delve deeper into the matter.
