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HOUSE BILL NO. 385
IN THE LEGISLATURE OF THE STATE OF ALASKA
THIRTY-SECOND LEGISLATURE - SECOND SESSION
BY REPRESENTATIVE WOOL
Introduced: 2/22/22
Referred: Labor and Commerce, Finance
A BILL
FOR AN ACT ENTITLED
1 "An Act authorizing mobile sports gaming; relating to the regulation of mobile sports
2 gaming; imposing a tax on mobile sports gaming revenue; imposing a tax on fantasy
3 sports; relating to criminal history record checks; and providing for an effective date."
4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:
5 * Section 1. AS 04.11.370(c) is amended to read:
6 (c) If the board receives notice from the Department of Revenue that a
7 licensee or permittee has violated a provision of AS 05.15 or AS 05.18 related to
8 gambling, the board
9 (1) may suspend the license or permit; and
10 (2) shall suspend the license or permit for a period of at least 30 days if
11 the offense is the person's second or subsequent violation of AS 05.15 or AS 05.18
12 related to gambling.
13 * Sec. 2. AS 05 is amended by adding a new chapter to read:
14 Chapter 18. Mobile Sports Gaming.
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1 Sec. 05.18.010. Mobile sports gaming license. (a) A person may not offer or
2 operate mobile sports gaming in this state without a license issued under this chapter.
3 (b) The commissioner may issue or renew a mobile sports gaming license to a
4 person that
5 (1) submits an application on a form approved by the commissioner;
6 (2) pays the license fee required under (d) of this section;
7 (3) meets the application requirements established under (c) of this
8 section;
9 (4) has or has a partner or joint operating agreement with a person who
10 has a mobile sports gaming license in at least three other states;
11 (5) meets any other qualifications established by the commissioner by
12 regulation; and
13 (6) has submitted the fingerprints of the applicant and each person
14 disclosed under (c)(2) of this section and has provided the fees required by the
15 Department of Public Safety under AS 12.62.160 for criminal justice information and
16 a national criminal history record check; the fingerprints and fees shall be forwarded
17 to the Department of Public Safety to obtain a report of criminal justice information
18 under AS 12.62 and a national criminal history record check under AS 12.62.400; or
19 submits the results of a criminal history record check conducted in another state within
20 the previous 12 months and a certification that there has been no material change since
21 the criminal history record check was completed.
22 (c) An applicant for a license or license renewal under this chapter shall
23 (1) include in the application the name, current address, and telephone
24 number of the applicant;
25 (2) disclose, if the applicant is not an individual,
26 (A) the state in which the applicant is incorporated, organized,
27 or formed, and any state in which the applicant is registered to do business;
28 (B) the names and addresses of all of the applicant's partners,
29 executive officers, managers, directors, and corporate officers;
30 (C) each corporate holding company, parent company, or
31 subsidiary company of a corporate applicant and each person that owns 15
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1 percent or more of the corporate applicant's business and that has the ability to
2 control the activities of the corporate applicant or elect a majority of the board
3 of directors of that corporate applicant, except for a bank or other licensed
4 lending institution that holds a mortgage or other lien acquired in the ordinary
5 course of business;
6 (D) each person associated with a noncorporate applicant that
7 directly or indirectly holds a beneficial or proprietary interest in the
8 noncorporate applicant's business operation or that the commissioner otherwise
9 determines has the ability to control the noncorporate applicant; and
10 (E) any executive, employee, or agent of an applicant who has
11 ultimate decision-making authority over the conduct of the applicant's mobile
12 sports gaming operations in the state;
13 (3) provide, for the applicant and each individual disclosed on an
14 application, a record of any other gambling-related licenses or applications previously
15 issued or revoked under this chapter or in any other jurisdiction;
16 (4) provide proof that the mobile sports gaming system the applicant
17 intends to use has been tested and certified for use in another jurisdiction of the United
18 States by an independent testing laboratory; and
19 (5) provide any additional information required by the commissioner.
20 (d) An applicant for an initial license or license renewal under this section
21 shall pay a license fee of $5,000. In addition to the license fee, the commissioner may
22 charge a processing fee for an initial or renewed license.
23 (e) A mobile sports gaming license issued under this section grants a licensee
24 the authority to conduct mobile sports gaming through any mobile application or
25 digital platform approved by the commissioner within the terms of the license and
26 regulations adopted under this chapter. A mobile sports gaming license or renewal is
27 valid for three years unless suspended or revoked under AS 05.18.020.
28 (f) A licensee shall give 30 days' written notice of any material change to
29 information provided in the licensee's application for a license or license renewal,
30 including any change in the information disclosed in (c)(2) of this section.
31 (g) The commissioner may not approve the issuance of more than 10 mobile
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1 sports gaming licenses under this section.
2 (h) The commissioner shall keep confidential all application information used
3 in the course of approving or denying an application, including any proprietary
4 information, confidential commercial information, or confidential financial
5 information that pertains to an applicant or licensee. The commissioner may release
6 records and information that are kept confidential under this subsection
7 (1) if the release is necessary to comply with a court order, if the
8 requester is a state or federal agency, or if the requester is under contract with the state
9 or federal agency to conduct research;
10 (2) if the information is an aggregate compilation of financial or tax
11 information from three or more licensees; and
12 (3) after 25 years, at which time the records and information that were
13 kept confidential under this subsection become public records subject to inspection
14 and copying under AS 40.25.110 - 40.25.140.
15 Sec. 05.18.020. Denial, reprimand, suspension, or revocation of license.
16 The commissioner may deny a license to an applicant, reprimand a licensee, or
17 suspend or revoke a license if the applicant or licensee
18 (1) knowingly makes a false statement of material fact to the
19 commissioner;
20 (2) intentionally does not disclose the existence or identity of a person
21 as required under AS 05.18.010(c)(2);
22 (3) has had a license revoked by any government agency responsible
23 for the regulation of gaming activities;
24 (4) has been convicted of a crime of moral turpitude, a gambling-
25 related offense, or a theft or fraud offense or has otherwise demonstrated, evidenced
26 by a police record or other satisfactory evidence, a lack of respect for law and order;
27 (5) has not demonstrated to the satisfaction of the commissioner
28 financial responsibility sufficient to adequately meet the requirements of the operation
29 of a mobile sports gaming business or proposed mobile sports gaming business; or
30 (6) has not met the requirements of this chapter.
31 Sec. 05.18.030. Licensee duties. A licensee shall
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1 (1) use a software monitoring system that meets industry standards to
2 identify irregularities in volume or usage changes that may signal suspicious activity
3 requiring further investigation; a licensee shall immediately report irregular activity to
4 the commissioner for further investigation;
5 (2) immediately report to state or federal law enforcement any facts or
6 circumstances related to the operation of a mobile sports gaming system that constitute
7 a violation of state or federal law, any suspicious betting over a threshold set by the
8 licensee and approved by the commissioner, or any betting that would require
9 disclosure under 31 C.F.R. 1021.320;
10 (3) conduct all mobile sports gaming activities in a manner that does
11 not threaten the public health, safety, or welfare of the people of the state;
12 (4) verify the identity of a person opening a sports wagering account in
13 order to ensure that persons placing wagers are real and to monitor risks;
14 (5) keep current all payments and obligations to the commissioner;
15 (6) prevent any person from tampering or interfering with the
16 operation of mobile sports gaming activities;
17 (7) ensure that mobile sports gaming occurs only when using a mobile
18 application or digital platform approved by the commissioner, in a manner consistent
19 with federal law, that uses communication technology to accept wagers originating in
20 the state or in a state or jurisdiction approved by the commissioner;
21 (8) maintain sufficient funds to conduct mobile sports gaming at all
22 times; and
23 (9) maintain daily records of gross receipts and adjusted gross receipts
24 and timely file any additional reports required by the commissioner.
25 Sec. 05.18.040. Commissioner of revenue to administer chapter; duties of
26 commissioner. (a) The commissioner shall
27 (1) administer and enforce this chapter;
28 (2) keep a record of all licenses issued under this chapter;
29 (3) impose and collect all fees, penalties, and tax on adjusted gross
30 revenue imposed by this chapter.
31 (b) The commissioner may
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1 (1) conduct hearings and investigations necessary to administer this
2 chapter;
3 (2) issue a subpoena to compel the attendance of a witness or a
4 subpoena duces tecum for the production of books, records, and other relevant
5 documents necessary for an investigation under this chapter;
6 (3) administer an oath or affirmation to a witness;
7 (4) take appropriate action to enforce this chapter, including filing a
8 petition for injunctive relief, bringing a civil action, or issuing a notice of violation of
9 this chapter or a regulation adopted under this chapter, an order to cease and desist, or
10 a closure order;
11 (5) enter into a mobile sports gaming agreement with another state,
12 territory, jurisdiction, government, or other entity to accept wagers from patrons
13 located outside the state, in compliance with applicable state and federal law; and
14 (6) take all necessary actions to ensure that a mobile sports gaming
15 agreement entered into under this chapter becomes effective.
16 Sec. 05.18.050. House rules; required disclosures. (a) A licensee shall adopt
17 house rules for mobile sports gaming transactions. The house rules must specify the
18 amount to be paid on winning wagers, the circumstances under which the licensee will
19 void a bet, treatment of errors, late bets, and related contingencies, and the effect of
20 schedule changes. A licensee shall obtain approval of house rules from the
21 commissioner before starting mobile sports gaming operations.
22 (b) The house rules must be available on the mobile sports gaming system.
23 (c) Each licensee shall include a statement on its mobile sports gaming system
24 providing information on gambling disorders and telephone numbers for resources and
25 entities providing assistance for gambling disorders. The licensee shall display the
26 statement in a manner and place conspicuous to a person gambling on the mobile
27 sports gaming system.
28 Sec. 05.18.060. Permissible forms of mobile sports gaming. (a) Permissible
29 forms of mobile sports gaming that may be conducted under a mobile sports gaming
30 license include single-game bets, teaser bets, parlays, over-under, money-line, pools,
31 exchange wagering, in-game wagering, in-play bets, proposition bets, and straight
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1 bets.
2 (b) A mobile sports gaming license does not authorize a licensee to conduct
3 fantasy sports contests in which participants assemble teams of athletes or individuals
4 and the winning outcome may depend on the knowledge and skill of the participants
5 but is determined predominantly by the accumulated statistical results of the
6 performance of athletes or individuals participating in the sporting event.
7 Sec. 05.18.070. Wagers and excluded persons. (a) A licensee may accept
8 wagers on wagering events through the use of a mobile application, a digital platform,
9 or a person's sports gaming account.
10 (b) A licensee may accept and place layoff wagers by and with other licensees.
11 A licensee placing a layoff wager with another licensee shall inform the other licensee
12 that the wager is being placed by a licensee and disclose the licensee's identity.
13 (c) A person placing a wager must be 21 years of age or older and physically
14 located in the state or in a state, territory, or jurisdiction with which the commissioner
15 has entered into a mobile sports gaming agreement.
16 (d) The commissioner or a licensee may exclude a person from participating in
17 or operating mobile sports gaming. The commissioner shall keep a list of all excluded
18 persons and share the list with each licensee.
19 (e) A licensee, employee of a licensee, or family member of a licensee may
20 not place a wager on any wagering event through the mobile sports gaming system
21 under control of the licensee.
22 Sec. 05.18.080. Funding wagers. (a) A licensee may establish a sports gaming
23 account electronically through an approved mobile application or digital platform.
24 (b) A licensee shall permit a person to fund a sports gaming account using