HSB 101 (LSB 1458YC (3) 88)

HOUSE FILE _____ 

BY  (PROPOSED COMMITTEE ON STATE GOVERNMENT BILL BY CHAIRPERSON KAUFMANN)

A BILL FOR

An Act relating to the conduct of sports betting by gambling licensees, making penalties applicable, and including implementation and effective date provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 99D.7, subsection 23, Code 2019, is amended to read as follows:
   23.  To establish a process to allow a person to be voluntarily excluded from the wagering area of a racetrack enclosure and from the gaming floor and sports betting wagering area, as defined in section 99F.1, of all other licensed facilities under this chapter and chapter 99F as provided in this subsection. The process shall provide that an initial request by a person to be voluntarily excluded shall be for a period of five years or life and any subsequent request following any five-year period shall be for a period of five years or life. The process established shall require that licensees be provided electronic access to names and social security numbers of persons voluntarily excluded through a secured interactive internet site maintained by the commission and information regarding persons voluntarily excluded shall be disseminated to all licensees under this chapter and chapter 99F. The names, social security numbers, and information regarding persons voluntarily excluded shall be kept confidential unless otherwise ordered by a court or by another person duly authorized to release such information. The process established shall also require a person requesting to be voluntarily excluded be provided information compiled by the Iowa department of public health on gambling treatment options. The state and any licensee under this chapter or chapter 99F shall not be liable to any person for any claim which may arise from this process. In addition to any other penalty provided by law, any money or thing of value that has been obtained by, or is owed to, a voluntarily excluded person as a result of wagers made by the person after the person has been voluntarily excluded shall be forfeited by the person and shall be credited to the general fund of the state.
    Sec. 2.  Section 99F.1, subsection 1, Code 2019, is amended to read as follows:
   1.  “Adjusted gross receipts” means the gross receipts less winnings paid to wagerers on gambling games. However, “adjusted gross receipts” does not include promotional play receipts received after the date in any fiscal year that the commission determines that the wagering tax imposed pursuant to section 99F.11 on all licensees in that fiscal year on promotional play receipts exceeds twenty-five million eight hundred twenty thousand dollars.
    Sec. 3.  Section 99F.1, Code 2019, is amended by adding the following new subsections:
   NEW SUBSECTION.  23.  “Sports betting” means the acceptance of wagers on collegiate or professional sporting events by any system of wagering as authorized by the commission. “Sports betting” does not include wagering on a race as defined in section 99D.2.
   NEW SUBSECTION.  24.  “Sports betting net receipts” means the gross receipts less winnings paid to wagerers on sports betting.
   NEW SUBSECTION.  25.  “Sports betting wagering area” means that portion of an excursion gambling boat, gambling structure, or racetrack enclosure in which sports betting is conducted as designated by the commission.
    Sec. 4.  Section 99F.3, Code 2019, is amended to read as follows:
   99F.3  Gambling games and sports betting authorized.
   The system of wagering on a gambling game and sports betting as provided by this chapter is legal, when conducted on an excursion gambling boat, gambling structure, or racetrack enclosure at authorized locations by a licensee as provided in this chapter.
    Sec. 5.  Section 99F.4, subsections 3 and 22, Code 2019, are amended to read as follows:
   3.  To adopt standards under which all excursion gambling boat operations shall be held and standards for the facilities within which the gambling operations are to be held. The commission may authorize the operation of gambling games on an excursion gambling boat and sports betting in a sports betting wagering area which is also licensed to sell or serve alcoholic beverages, wine, or beer as defined in section 123.3.
   22.  To establish a process to allow a person to be voluntarily excluded from the gaming floor and sports betting wagering area of an excursion gambling boat, from the wagering area, as defined in section 99D.2, and from the gaming floor and sports betting wagering area of all other licensed facilities under this chapter and chapter 99D as provided in this subsection. The process shall provide that an initial request by a person to be voluntarily excluded shall be for a period of five years or life and any subsequent request following any five-year period shall be for a period of five years or life. The process established shall require that licensees be provided electronic access to names and social security numbers of persons voluntarily excluded through a secured interactive internet site maintained by the commission and information regarding persons voluntarily excluded shall be disseminated to all licensees under this chapter and chapter 99D. The names, social security numbers, and information regarding persons voluntarily excluded shall be kept confidential unless otherwise ordered by a court or by another person duly authorized to release such information.  The process established shall also require a person requesting to be voluntarily excluded be provided information compiled by the Iowa department of public health on gambling treatment options. The state and any licensee under this chapter or chapter 99D shall not be liable to any person for any claim which may arise from this process. In addition to any other penalty provided by law, any money or thing of value that has been obtained by, or is owed to, a voluntarily excluded person as a result of wagers made by the person after the person has been voluntarily excluded shall be forfeited by the person and shall be credited to the general fund of the state.
    Sec. 6.  Section 99F.4, Code 2019, is amended by adding the following new subsection:
   NEW SUBSECTION.  27.  To adopt standards under which all sports betting is conducted, to identify occupations within sports betting which require licensing, and to adopt standards for licensing and background qualifications for occupations including establishing fees for the occupational license. All revenue received by the commission under this chapter from license fees and regulatory fees shall be deposited in the general fund of the state and shall be subject to the requirements of section 8.60.
    Sec. 7.  NEW SECTION.  99F.7A  Sports betting —— license —— terms and conditions —— fees.
   1.  The commission shall, upon payment of a license fee of one thousand dollars and submission of an application to the commission, issue a license to conduct or operate sports betting only to a licensee authorized to conduct or operate gambling games under section 99F.4A or 99F.7, subject to the requirements of this chapter.
   2.  A licensee issued a license to conduct or operate sports betting under this section shall employ commercially reasonable steps to prohibit coaches, athletic trainers, officials, players, or other individuals who participate in a collegiate or professional sporting event that is the subject of sports betting from sports betting under this chapter. In addition, a licensee shall employ commercially reasonable steps to prohibit persons who are employed in a position with direct involvement with coaches, players, athletic trainers, officials, players, or participants in a collegiate or professional sporting event that is the subject of sports betting from sports betting under this chapter.
    Sec. 8.  Section 99F.8, Code 2019, is amended to read as follows:
   99F.8  Bond of licensee.
   A licensee licensed under section 99F.7 shall post a bond to the state of Iowa before the license is issued in a sum as the commission shall fix, with sureties to be approved by the commission. The bond shall be used to guarantee that the licensee faithfully makes the payments, keeps its books and records and makes reports, and conducts its gambling games and sports betting in conformity with this chapter and the rules adopted by the commission. The bond shall not be canceled by a surety on less than thirty days’ notice in writing to the commission. If a bond is canceled and the licensee fails to file a new bond with the commission in the required amount on or before the effective date of cancellation, the licensee’s license shall be revoked. The total and aggregate liability of the surety on the bond is limited to the amount specified in the bond.
    Sec. 9.  Section 99F.9, subsection 1, Code 2019, is amended to read as follows:
   1.  Except as permitted in this section, the licensee shall permit no form of wagering on gambling games or sports betting.
    Sec. 10.  Section 99F.9, Code 2019, is amended by adding the following new subsection:
   NEW SUBSECTION.  3A.  a.  For the purposes of this section, unless the context otherwise requires:
   (1)  “Advance deposit sports betting wagering” means a method of sports betting wagering in which an eligible individual may, in an account established with a licensee under section 99F.7A, deposit moneys into the account and use the account balance to pay for sports betting wagering. Prior to January 1, 2021, an account must be established by an eligible individual in person with a licensee. 
   (2)  “Eligible individual” means an individual who is at least twenty-one years of age or older who is located within this state.
   b.  The commission may authorize a licensee under section 99F.7A to conduct advance deposit sports betting wagering. An advance deposit sports betting wager may be placed in person in the sports betting wagering area, or from any other location via a telephone-type device or any other electronic means.
   c.  An unlicensed person taking or receiving sports betting wagers from residents of this state is guilty of a class “D” felony.
    Sec. 11.  Section 99F.9, subsection 4, Code 2019, is amended to read as follows:
   4.  A person under the age of twenty-one years shall not make or attempt to make a wager pursuant to subsection 3A or on an excursion gambling boat, gambling structure, or in a racetrack enclosure and shall not be allowed on the gaming floor of an excursion gambling boat or gambling structure or in the wagering area, as defined in section 99D.2, or on the gaming floor of a racetrack enclosure. However, a person eighteen years of age or older may be employed to work on the gaming floor of an excursion gambling boat or gambling structure or in the wagering area or on the gaming floor of a racetrack enclosure. A person who violates this subsection with respect to making or attempting to make a wager commits a scheduled violation under section 805.8C, subsection 5, paragraph “a”.
    Sec. 12.  Section 99F.11, subsection 3, unnumbered paragraph 1, Code 2019, is amended to read as follows:
   The taxes imposed by this section on adjusted gross receipts from gambling games authorized under this chapter shall be paid by the licensee to the treasurer of state within ten days after the close of the day when the wagers were made and shall be distributed as follows:
    Sec. 13.  Section 99F.11, Code 2019, is amended by adding the following new subsection:
   NEW SUBSECTION.  4.  A tax is imposed on the sports betting net receipts received each fiscal year by a licensed operator from sports betting authorized under this chapter at the rate of six and three-quarters percent. The taxes imposed by this subsection for sports betting authorized under this chapter shall be paid by the licensed operator to the treasurer of state as determined by the commission and shall be credited as provided in section 8.57, subsection 5. 
    Sec. 14.  Section 99F.15, subsection 1, paragraph c, Code 2019, is amended to read as follows:
   c.  Acting, or employing a person to act, as a shill or decoy to encourage participation in a gambling game or sports betting.
    Sec. 15.  Section 99F.15, subsection 4, paragraphs d, h, and i, Code 2019, are amended to read as follows:
   d.  Cheats at a gambling game, including but not limited to committing any act which alters the outcome of the game, or cheats at sports betting.
   h.  Claims, collects, or takes, or attempts to claim, collect, or take, money or anything of value in or from the gambling games or sports betting, with intent to defraud, without having made a wager contingent on winning a gambling game or sports betting wager, or claims, collects, or takes an amount of money or thing of value of greater value than the amount won.
   i.  Knowingly entices or induces a person to go to any place where a gambling game or sports betting is being conducted or operated in violation of the provisions of this chapter with the intent that the other person plays or participates in that gambling game or sports betting.
    Sec. 16.  IMPLEMENTATION.  The racing and gaming commission shall not implement this Act until the commission has adopted rules pursuant to chapter 17A providing for such implementation and such rules have become effective.
    Sec. 17.  EFFECTIVE DATE.  This Act, being deemed of immediate importance, takes effect upon enactment.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill authorizes gambling licensees to conduct sports betting.
   Code section 99F.1, concerning definitions, is amended. The bill defines “sports betting” as acceptance of wagers on collegiate or professional sporting events, except races as defined in Code chapter 99D, by any system of wagering as authorized by the racing and gaming commission. “Sports betting net receipts” is defined as gross receipts less winnings paid to wagerers on sports betting. “Sports betting wagering area” is defined as that portion of a gambling licensee facility in which sports wagering is conducted as designated by the commission. 
   Code sections 99D.7(23) and 99F.4(22), concerning persons voluntarily excluded from wagering or gaming areas, are amended to include the sports betting wagering area.
   Code section 99F.3, concerning authorized wagering under Code chapter 99F, is amended to authorize wagering on sports betting.
   Code section 99F.4, concerning racing and gaming commission powers, is amended to authorize the operation of sports betting in a sports betting wagering area on an excursion gambling boat which is also licensed to serve alcoholic beverages, grants the racing and gaming commission the authority to adopt standards under which sports betting is conducted, and provides that all revenue received by the commission from license fees and regulatory fees for sports betting shall be deposited in the general fund of the state.
   New Code section 99F.7A provides specific requirements relative to the licensing, operation, and fees applicable to sports betting. The bill provides that the commission shall, upon payment of a license fee of $1,000, issue a license to conduct or operate sports betting to a licensee authorized to conduct or operate gambling games under Code section 99F.4A or 99F.7. The new Code section also provides that a licensee issued a license to conduct or operate sports betting shall employ commercially reasonable steps to prohibit coaches, athletic trainers, officials, players, participants, or other persons employed in a position with direct involvement with such individuals from sports betting under this Code chapter.
   Code section 99F.8, concerning licensee bonding requirements, is amended to make such requirements applicable to sports betting.
   Code section 99F.9, concerning wagering on gambling games, is amended to allow the commission to authorize gambling game licensees under Code chapter 99F to conduct advance deposit sports betting wagering. The bill would allow for an advance deposit wager to be placed in person at a licensed facility authorized to conduct gambling games or from any other location by telephone or other electronic means. The bill defines “advance deposit sports betting wagering” as a form of wagering where an eligible individual creates an account with a licensee, deposits money into that account, and can use the balance within the account for sports betting wagering. Prior to January 1, 2021, an account must be established in person with a licensee. The bill defines an “eligible individual” for purposes of advance deposit sports betting wagering as an individual 21 years of age or older who is located within this state. The bill provides that an unlicensed person taking sports betting wagers from Iowa residents is guilty of a class “D” felony, punishable by confinement for no more than five years and a fine of at least $750 but not more than $7,500. The Code section is also amended to provide that a person under the age of 21 shall not make or attempt to make a wager by advance deposit sports betting wagering. 
   Code section 99F.11, concerning the wagering tax, is amended. The bill provides that the wagering tax on sports betting net receipts received each fiscal year by a licensed operator from sports betting at the rate of six and three-quarters percent. The taxes imposed shall be paid by the licensed operator to the treasurer of state as determined by the commission and shall be credited as provided in Code section 8.57, subsection 5.
   Code section 99F.15, concerning certain prohibited activities and penalties, is amended to provide that current prohibitions on cheating at a gambling game, claiming anything of value from a gambling game with intent to defraud, and knowingly enticing a person to go where a gambling game is conducted in violation of Code chapter 99F also applies to sports betting.
   The bill takes effect upon enactment. However, the bill provides that the racing and gaming commission shall not implement the bill until the commission has adopted rules pursuant to Code chapter 17A providing for such implementation and such rules have become effective.