The Virginia Gaming Law subcommittee plans to introduce stricter regulations for fantasy sports amid the current ambiguity between legal sports betting and pick-’em-style DFS.
Virginia may be the next state to join the crackdown on fantasy sports.
Old Dominion Rep. Paul Krizek (D-Fairfax) told the Virginia Mercury this week that fantasy sports are “a compliance nightmare” and anything that “needs to be controlled. ”
Krizek, who sits on a subcommittee on the Gambling Act, plans to introduce a bill in the 2025 General Assembly consultation to explain the ambiguity between legal sports in the Commonwealth and prop-focused fantasy sports. It also wants to increase the age limit for fantasy cash games from 18 to 21 years old.
Krizek has a lot of the same with fantasy sports that other lawmakers and regulators in Massachusetts, Florida and New York, among others, have had in recent months.
The lawmaker said DFS operators like Underdog Fantasy and PrizePicks create the same prop bets that are presented through classic and regulated bookmakers.
“I think they’re taking advantage of the lack of regulatory oversight,” Krizek said.
Unlike classic bookmakers, fantasy sports operators are subject to a 15% tax rate on adjusted gross gaming revenue. DFS is also regulated through the same state entity.
Sports betting is done through the Virginia Lottery, which requires an upfront payment of $250,000 to obtain an operating license and an annual renewal of $200,000. DFS is overseen through the Virginia Department of Agriculture and Consumer Services, which charges operators $8,300 to download and renew licenses.
At a recent subcommittee meeting, Sen. Bryce Reeves (R-Spotsylvania) told DraftKings, which runs a sports and DFS site in the Commonwealth, that they are running to “achieve a fair and timely playing field. ”
Attorney General Jason Miyares wrote in a letter last year that DFS sites that offer over- or under-props will have to meet the same needs as sportsbook operators, but no enforcement has been enforced.
The Fantasy Sports Coalition said in a statement to the Virginia Mercury that it plans to work with lawmakers and fully comply with Virginia law.
Old Domain lawmakers and regulators would likely look to other states for data on how to deal with the confusion of ancillary DFS sites.
New York, Florida, and Michigan are markets that have outright banned pick’em games. PrizePicks has found a way to fix this by providing an arena product that matches players and pits them against each other in gaming prop options.
It’s possible that Virginia will simply adopt a formula that wouldn’t be advantageous to DFS operators but would differentiate DFS and sports betting enough to satisfy some regulators.
The Commonwealth could also adopt a more drastic technique and ban them altogether or make DFS operators pay the same fees as legal sports betting.
Both of these things seem less likely, with the latter greatly hurting the site’s chances of staying in the state. Either way, 2025 looks like a year of clarity for Virginia.