INDIANAPOLIS – Lawmaker and sports fan Alan Morrison watched online fantasy sports grow into a multi-billion dollar industry. Now, he wants the state to regulate and tax it like other legal forms of gambling.

Morrison, a Republican from Terre Haute who plays fantasy sports, said he’s drafting legislation to regulate sites including DraftKings and FanDuel, turning over control of their operation in Indiana to the state’s licensed casinos.

“We’ve got an existing gaming industry here that has to play by our rules,” he said. “For another entity to come in and play by a separate set of rules isn’t fair.”

Morrison’s proposal, which would be filed in the coming year, reflects a growing interest nationally to reign in – and capitalize on – the big-money sites. At least 15 states have moved to control the fantasy leagues engaging in massive online transactions that, until recently, have escaped federal oversight.

Proposals in several states – including Arizona, Iowa, Louisiana, Montana and Washington – move to ban outright the Web-based contests as illegal gambling. Other states are looking for ways to pull the sites into their legal gaming frameworks, to protect players and generate much-needed revenue for their budgets.

“States aren’t waiting for the federal government to act,” said Morrison, who failed last year to push forward a similar bill to legalize sports betting. His colleagues, already engaged in a losing battle with Gov. Mike Pence over measures to boost casino revenues, weren’t interested in taking on another gaming fight.

Morrison is convinced the stakes are higher now. The fantasy sports industry is growing rapidly – some 56 million players are now involved – as the state’s tax revenue from brick-and-mortar casinos is projected to continue a steady decline.

Senate Appropriations Chairman Luke Kenley, R-Noblesville, hasn’t endorsed Morrison’s plan. But he’s heard about from the bill’s likely co-sponsor, Sen. Jon Ford, R-Terre Haute,

like to see it debated.

“The rest of our gaming businesses are subject to taxes,” said Kenley. “It seems appropriate that this should be, too.”

Morrison’s measure may face long odds given uncertainty at the federal level over whether fantasy sports gaming is even legal. But he fears a tougher obstacle in convincing colleagues that fantasy sports are big enough for the state to tackle.

“I don’t know if people realize how big it’s really become,” he said. “Years ago, it was just some nerds sitting in their mom’s basement, playing it with their friends.” In September, the Wall Street Journal valued FanDuel and DraftKings – the biggest daily fantasy sports operators – at more than $1 billion each.

Players are generally college-educated men in their 30s with money, according to the Fantasy Sports Trade Association. The average player spends $465 on the games a year. In addition to the allure of creating hypothetical teams that succeed or fail with the results of real professional players, fans are attracted by the sites’ big prizes: DraftKings expects to pay close to $2 billion in cash prizes this year.

Lucrative partnerships with sports teams and broadcasters such as ESPN have lent the online industry legitimacy. The industry is gaining publicity as it dumps hundreds of millions of dollars into advertising.

Some of the attention they’ve gotten is negative. Federal prosecutors in New York are looking into allegations that a DraftKings employee used proprietary information to play on another fantasy site – a charge that the company denies, according to the Wall Street Journal.

The sites area also drawing attention from members of Congress and others who question their legality. Under the Unlawful Internet Gambling and Enforcement Act of 2006, sports betting is illegal is most states. But the law opens a window for fantasy leagues, based on an argument that they involve more skill than luck.

That argument is being increasingly tested as money generated by online games escalates. Last month, the Nevada Gaming Commission banned the fantasy sports websites then ordered their operators to apply for a state gambling license.

Morrison is looking to Pennsylvania for a similar model. Lawmakers there are debating whether to put the fantasy leagues under control of state’s gaming commission. That would compel them to partner with already established, and regulated, casinos and pay a licensing fee to the state.

Players would log into a casino website and be directed to fantasy sports league sites to play their games. Morrison said most wouldn’t notice a difference.

Morrison said hitching the fantasy leagues to casinos also enables the state to build in financial safeguards for players and to collect a wagering tax, akin to one that casinos already pay whenever someone places a bet, Morrison said.

The fantasy leagues are likely to resist such a move.

Jeremy Kudon, a national lobbyist for DraftKings and FanDuel, said the industry opposes legislation that forces then to partner with casinos, calling it “tantamount to a ban.”

He warned that adopting the proposed Pennsylvania model would cause the fantasy sports companies to pull out of Indiana.

That could infuriate 1 million or more Hoosiers who patronize the sites, according to the trade association.

Ed Feigenbaum, publisher of Indiana Gaming Insight, calls Morrison’s proposal “premature” given the legal issues surrounding online sports gaming that have yet to be sorted out at the federal level.

Still, he said he understands the desire of states – and casino operators – to capture some of the flood of dollars generated by the industry.

Casinos, with traditional slot machines and roulette wheels, have largely failed to attract technology-savvy millennials who play fantasy sports online.

“Casinos know they can’t bring this generation into their casinos as their regular customers,” he said. “They know they’ve got capture them in some other way.”

Maureen Hayden covers the Indiana Statehouse for CNHI’s newspapers and websites. Reach her at mhayden@cnhi.com