Social conservatives are coming out against a bill that would create a regulatory structure for daily fantasy sports operators, saying it would encourage Wisconsinites to lose money on what they view as another form of gambling.

But the bill’s backers say those daily contests don’t amount to gambling — and that people should have the freedom to make a little money off their knowledge of a certain sport.

“I’ve always been of the mindset that people make their own money and can decide to spend it how they want, and if this is an activity that people enjoy doing, I say, ‘That’s fine,’” said bill author Rep. Tyler Vorpagel, R-Plymouth, who uses the DraftKings platform.

The proposal would make Wisconsin the 17th state in the country that makes it clear that daily fantasy sports operators can operate legally. A similar bill from Vorpagel got a public hearing last session but did not get a vote. The new version from Vorpagel lowers the registration fees for operators, as smaller ones had voiced concerns that they could be shut out under last session’s bill.

Those operators, including DraftKings and another major one called FanDuel, let players pick a different set of athletes every game, rather than the more traditional season-long leagues where people stick with a set of players for months. And their rise in recent years has drawn the attention of a handful of state attorneys general, who’ve declared daily fantasy sports are illegal gambling.

Critics say the proposal is a back-door way of expanding gambling.

“They know good and well that the consumers are really betters,” said Wisconsin Family Action President Julaine Appling of the bill’s backers. “And the best way to protect them is to just say, ‘We’re not going to open this Pandora’s box.’”

The debate centers on whether the daily contests are decided on skill or luck.

Appling, for example, said injuries, weather incidents or other things “out of the control of anybody” can easily alter the outcome of a daily contest, whereas the season-long contests are based off weeks of results. Appling and other opponents say the daily contests are illegal under current law but are happening in Wisconsin because “no one has brought a legal challenge” against operators. The bill, she said, is about preventing such a lawsuit from happening.

Rep. Scott Allen, R-Waukesha, who sent out a news release opposing the bill, said even though picking the right teams each day takes some knowledge, people are essentially placing wagers on the outcomes of games.

“Just because there’s some skill doesn’t mean that it is still not a game of luck,” he said.

But the bill’s supporters say there’s much more to it — and that the key difference-maker is people’s knowledge of the players they’re picking for their lineups, who they’re up against and what the stats show.

Marc La Vorgna, a spokesman for DraftKings and FanDuel, said a wide range of analyses have shown that fantasy sports are “overwhelmingly games of skill.”

“They can call it chance all they want, but they have no data or research to back up the claim, because the claim is false — just ask any regular player,” he said. “States across the country have recognized the need for similar laws; the bill drafted here draws from the experiences in others states and we are hoping Wisconsin will soon be the 17th state to pass a fantasy sports law.”

The bill would require those two platforms — and dozens of much smaller ones — to cooperate with the state Department of Financial Institutions if they want to do business in Wisconsin.

It also lays out several standards for those operators, such as preventing their employees from participating in their own contests, requiring them to verify that participants are at least 18 years old, giving participants information on how to get help for addictive behavior and calling for annual audits.

The bill, which has some Democratic co-sponsors, also would require those operators to pay registration fees of 3 percent of their net revenues in Wisconsin the previous year, though the registration fees are capped at $10,000, and also pay annual renewal fees of 3 percent of their revenues in the state. Startups without any revenues would pay $500.

DFI spokesman George Althoff that the agency is finalizing its fiscal estimate and expects to release it next week.

Peter Schoenke, the president and co-founder of the fantasy sports information website RotoWire.com, said the fees are low enough under Vorpagel’s new bill that they won’t “freeze out” some of the smaller operators — including those with a long history in Wisconsin. Schoenke is also chairman of the Fantasy Sports Trade Association, which is headquartered in Madison.

But Appling said the bill is “fundamentally not in the best interests of Wisconsin citizens.”

“If we do this, it will represent the largest expansion of gambling in Wisconsin ever because what it is essentially doing is turning every smartphone and tablet and laptop and desktop computer into an instant casino,” she said.

See the bill:
https://docs.legis.wisconsin.gov/2017/proposals/ab526

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