Bill Summary – FastDemocracy

130th MAINE LEGISLATURE
                    FIRST SPECIAL SESSION-2021
Legislative Document                                                                            No. 1527
H.P. 1131                                                        House of Representatives, April 19, 2021
            An Act To Ensure Proper Oversight of Sports Betting in the State
   Received by the Clerk of the House on April 15, 2021. Referred to the Committee on
Veterans and Legal Affairs pursuant to Joint Rule 308.2 and ordered printed pursuant to Joint
Rule 401.
                                                                                     ROBERT B. HUNT
                                                                                                Clerk
Presented by Representative ROCHE of Wells.
Cosponsored by Representatives: COREY of Windham, CROCKETT of Portland,
DILLINGHAM of Oxford, FAULKINGHAM of Winter Harbor, O'CONNOR of Berwick,
STEARNS of Guilford, Senators: LUCHINI of Hancock, WOODSOME of York.
                                         Printed on recycled paper
 Be it enacted by the People of the State of Maine as follows:
     Sec. 1. 8 MRSA §1003, sub-§5, as repealed and replaced by PL 2017, c. 475, Pt.
 A, §11, is amended to read:
     5. Additional duties of the director. The director also serves as the director of the
 Gambling Control Unit, established as a bureau within the Department of Public Safety
 under Title 25, section 2902, subsection 12. As director of the unit, the director shall
 administer and enforce the laws governing fantasy contests under chapter 33, sports
 wagering under chapter 35 and beano and games of chance under Title 17, chapters 13-A
 and 62, respectively.
     Sec. 2. 8 MRSA §1104, sub-§2, as enacted by PL 2017, c. 303, §2, is amended to
 read:
     2. Certain leagues and contests prohibited. A fantasy contest operator may not offer
 a fantasy contest based on the performances of participants in collegiate or high school
 athletic events or other athletic events involving participants under 18 years of age.
     Sec. 3. 8 MRSA c. 35 is enacted to read:
                                       CHAPTER 35
                       REGULATION OF SPORTS WAGERING
 §1201. Authorization of sports wagering; license required
     Notwithstanding any provision of law to the contrary, the operation of sports wagering
 and ancillary activities are lawful when conducted in accordance with the provisions of this
 chapter and the rules adopted under this chapter.
    A person or entity may not engage in any activities in this State that require a license
 under this chapter unless all necessary licenses have been obtained in accordance with this
 chapter and rules adopted under this chapter.
 §1202. Definitions
    As used in this chapter, unless the context otherwise indicates, the following terms
 have the following meanings.
     1. Adjusted gross sports wagering receipts. "Adjusted gross sports wagering
 receipts" means an operator's gross receipts from sports wagering less the total of all
 winnings paid to patrons, which includes the cash equivalent of any merchandise or thing
 of value awarded as a prize, and less excise tax payments remitted to the Federal
 Government.
     2. Collegiate sports or athletic event. "Collegiate sports or athletic event" means a
 sports or athletic event offered or sponsored by, or played in connection with, a public or
 private institution that offers postsecondary educational services.
     3. Commissioner. "Commissioner" means the Commissioner of Public Safety.
     4. Department. "Department" means the Department of Public Safety.
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    5. Director. "Director" means the director of the Gambling Control Unit within the
 department.
    6. Facility operator. "Facility operator" means a facility sports wagering licensee
 under subsection 7, paragraph A.
      7. License. "License" means any license applied for or issued by the director under
 this chapter, including, but not limited to:
     A. A facility sports wagering license under section 1206 to conduct sports wagering
     in which wagers are placed within a physical location in this State;
     B. A mobile sports wagering license under section 1207 to permit a mobile operator
     to operate sports wagering through an approved mobile application or other digital
     platform that involves, at least in part, the use of the Internet;
     C. A supplier license under section 1208 to sell goods and services to be used in
     connection with sports wagering, but not to directly accept wagers;
     D. A management services license under section 1209 to manage sports wagering on
     behalf of a facility sports wagering licensee or a mobile sports wagering licensee; and
     E. An occupational license under section 1210 to be employed by a facility sports
     wagering licensee to operate sports wagering when the employee performs duties in
     furtherance of or associated with the operation of sports wagering.
    8. Mobile operator. "Mobile operator" means a mobile sports wagering licensee
 under subsection 7, paragraph B.
     9. Official league data. "Official league data" means statistics, results, outcomes and
 other data relating to a sports event that is obtained pursuant to an agreement with the
 relevant sports governing body or an entity expressly authorized by the relevant sports
 governing body to provide that data to operators for determining the outcome of tier 2
 sports wagers on that sports event.
     10. Operator. "Operator" includes a facility operator and a mobile operator.
     11. Professional sports or athletic event.     "Professional sports or athletic event"
 means an event at which 2 or more persons participate in sports or athletic contests and
 receive compensation in excess of actual expenses for their participation in the event.
     12. Prohibited sports event. "Prohibited sports event" means a high school sports or
 athletic event, any other event in which a majority of the participants are under 18 years of
 age or a collegiate sports or athletic event in which any Maine collegiate sports team
 participates, regardless of where the event takes place.
      13. Qualified gaming entity. "Qualified gaming entity" means a gaming entity that
 offers sports wagering through mobile applications or digital platforms in any jurisdiction
 in the United States pursuant to a state regulatory structure.
     14. Sports event. "Sports event" means any professional sports or athletic event,
 collegiate sports or athletic event or amateur sports or athletic event, including but not
 limited to an Olympic or international sports or athletic event, a motor vehicle race or an
 electronic sports event, commonly referred to as "e-sports."
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     15. Sports governing body. "Sports governing body" means an organization that is
 headquartered in the United States and prescribes final rules and enforces codes of conduct
 with respect to a sports event and participants in the sports event.
      16. Sports wagering. "Sports wagering" means the business of accepting wagers on
 sports events or portions of sports events, the individual performance statistics of athletes
 in a sports event or a combination of any of the same by any system or method of wagering
 approved by the director, including, but not limited to, in person on the property of a facility
 licensee or via a mobile sports wagering licensee's mobile applications and digital
 platforms that use communications technology to accept wagers. "Sports wagering" does
 not include the sale of pari-mutuel pools authorized under chapter 11 or the operation of
 fantasy contests as defined in section 1101, subsection 4.
     17. Tier 1 sports wager. "Tier 1 sports wager" means a wager placed on a sports
 event that is based solely on the final score or final outcome of the relevant sports event
 and is placed before the relevant sports event has begun.
    18. Tier 2 sports wager. "Tier 2 sports wager" means a wager placed on a sports
 event that is not a tier 1 sports wager.
    19. Wager. "Wager" means a sum of money or thing of value risked on an uncertain
 occurrence.
 §1203. Powers and duties of director
     1. Powers and duties. In administering and enforcing this chapter, the director:
     A. Has the power to regulate the conduct of sports wagering;
     B. Shall determine the eligibility of a person to hold or continue to hold a license, shall
     issue all licenses and shall maintain a record of all licenses issued under this chapter;
     C. Shall levy and collect all fees, civil penalties and tax on adjusted gross sports
     wagering receipts imposed by this chapter, except as otherwise provided under this
     chapter;
     D. May sue to enforce any provision of this chapter or any rule of the director by civil
     action or petition for injunctive relief;
     E. May hold hearings, administer oaths and issue subpoenas or subpoenas duces tecum
     in the manner provided by applicable law; and
     F. May exercise any other powers necessary to effectuate the provisions of this chapter
     and the rules of the director.
     2. Rules. The director shall adopt rules governing the conduct of sports wagering in
 the State, which must, at a minimum, include the following:
     A. Qualifications for obtaining a facility sports wagering license, supplier license,
     management services license, mobile sports wagering license or occupational license,
     including the procedure and qualifications for obtaining a waiver of the occupational
     license requirement;
     B. Qualifications for obtaining a temporary facility sports wagering license, temporary
     supplier license, temporary management services license and temporary mobile sports
     wagering license;
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 C. The methods of operation of sports wagering, including but not limited to the
 permitted systems and methods of wagers; the use of credit and checks by persons
 making wagers; the types of wagering receipts that may be used; the method of issuing
 receipts; the prevention of sports wagering on prohibited sports events; the protection
 of patrons placing wagers; and the promotion of social responsibility and responsible
 gaming and display of information on resources for problem gambling at a facility
 operator's premises or on any mobile application or digital platform used to place
 wagers;
 D. If the director determines that establishment of a maximum wager is necessary for
 the protection of public safety, the maximum wager that may be accepted from any one
 person on a single sports event;
 E. Standards for the adoption of comprehensive house rules governing sports wagering
 by operators and the approval of house rules by the director as required under section
 1211;
 F. Minimum design and security requirements for the physical premises of facility
 operators in which sports wagering is conducted, including but not limited to minimum
 requirements for the acceptance of wagers at a self-serve kiosk located on the premises
 and minimum required methods for verifying the identity and age of a person who
 places a wager with a facility operator, for verifying that the person making a wager is
 not prohibited from a making a wager under section 1213 and for requiring the refund
 of any wager determined to have been placed by a person prohibited from making a
 wager under section 1213;
 G. Minimum design and security requirements for mobile applications and digital
 platforms for the acceptance of wagers by mobile operators, including required
 methods for verifying the age and identity of a person who places a wager with a mobile
 operator, for verifying that the person making the wager is physically located in the
 State and is not prohibited from making a wager under section 1213 and for requiring
 the refund of any wager determined to have been placed by a person prohibited from
 making a wager under section 1213;
 H. The types of interested parties, including sports team or league employees or
 owners, from whom operators are prohibited from accepting wagers under section
 1213, subsection 4;
 I. Minimum design, security, testing and approval requirements for sports wagering
 equipment, systems or services sold by suppliers licensed under section 1208;
 J. Minimum requirements for a contract between a management services licensee
 under section 1209 and an operator on whose behalf the management services licensee
 conducts sports wagering, including but not limited to requirements that the person
 providing management services is licensed prior to entering a contract and that the
 contract be approved by the director prior to the conduct of sports wagering;
 K. Establishment of a list of persons who are not authorized to place a wager on a
 sports event, including but not limited to those persons who voluntarily request that
 their names be included on the list of unauthorized persons. The rules adopted under
 this paragraph must define the standards for involuntary placement on the list and for
 removal from the list; and
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     L. Minimum internal control standards for operators, including but not limited to
     procedures for safeguarding assets and revenues; the recording of cash and evidence
     of indebtedness; the maintenance of reliable records, accounts and reports of
     transactions, operations and events; required audits; and the content of and frequency
     with which reports of sports wagering activities and revenues must be made to the
     director.
     3. Rulemaking. Rules adopted by the director pursuant to this chapter are routine
 technical rules as defined in Title 5, chapter 375, subchapter 2-A.
 §1204. Application; criminal history background check
     1. Application. An application for a license or for renewal of a license required under
 this chapter must be submitted on the form provided by the director. An application
 submitted to the director must, at a minimum, include the following:
     A. The full name, current address and contact information of the applicant;
     B. Disclosure of each person that has control of the applicant as described in subsection
     2;
     C. Consent to permit the director to conduct a criminal history record check in
     accordance with subsection 3 of the applicant and each person disclosed under
     paragraph B in accordance with procedures established by the director;
     D. For the applicant and each person disclosed under paragraph B, a record of previous
     issuances and denials of or any adverse action taken against a gambling-related license
     or application under this Title or in any other jurisdiction. For purposes of this
     paragraph, "adverse action" includes, but is not limited to, a condition resulting from
     an administrative, civil or criminal violation, a suspension or revocation of a license or
     a voluntary surrender of a license to avoid or resolve a civil, criminal or disciplinary
     action; and
     E. Any additional information required by the director by rule.
     2. Persons that have control. The following persons are considered to have control
 of an applicant or a licensee:
     A. Each corporate holding company, parent company or subsidiary company of a
     corporate applicant or licensee and each person that owns 10% or more of the corporate
     applicant or licensee and that has the ability to control the activities of the corporate
     applicant or licensee or elect a majority of the board of directors of that corporate
     applicant or licensee, except for a bank or other licensed lending institution that holds
     a mortgage or other lien acquired in the ordinary course of business;
     B. Each person associated with a noncorporate applicant or licensee that directly or
     indirectly holds a beneficial or proprietary interest in the noncorporate applicant's or
     licensee's business operation or that the director otherwise determines has the ability to
     control the noncorporate applicant or licensee; and
     C. Key personnel of an applicant or licensee, including any executive, employee or
     agent, having the power to exercise significant influence over decisions concerning any
     part of the applicant's or licensee's relevant business operation.
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      3. Criminal history record check. The director shall request a criminal history record
 check in accordance with this subsection for each applicant for initial licensure and each
 person required to be disclosed by the applicant for initial licensure under subsection 1,
 paragraph B. The director may require a criminal history record check in accordance with
 this section from a licensee seeking to renew a license, from any person the licensee is
 required to disclose under subsection 1, paragraph B as part of the license renewal
 application and from any person identified by the licensee under subsection 4. A criminal
 history record check conducted pursuant to this section must include criminal history
 record information obtained from the Maine Criminal Justice Information System
 established in Title 16, section 631 and the Federal Bureau of Investigation.
     A. Criminal history record information obtained from the Maine Criminal Justice
     Information System pursuant to this subsection must include a record of public criminal
     h