Michigan Now Eyes Sports Betting with No Online Gaming
It looks like 2019 will be another year of disappointment for Michigan online poker players and internet casino game fans.
The efforts to legalize online gaming in Michigan in 2019 have not been particularly hopeful from the start. As soon as Governor Gretchen Whitmer came out against the plan, she and Representative Brandt Iden clashed over the issue and never found enough common ground to make progress.
Since sports betting is the trend and likely easier to pass through the legislature with the governor’s approval, it looks like sports betting is the only form of gambling expansion worth pursuing for lawmakers in Michigan, at least in 2019.
Stopped by @MGMGrandDetroit for their opening of their new “Moneyline Sports Lounge” that just opened today!
It’s got 60 TV’s, plenty of beverage options, VIP seating, non-smoking and much more!
— Justin Rose (@JRoseDet) October 9, 2019
2019 Began with Hope
Longtime online gambling advocate Rep. Iden worked hard in 2018 to pass an online poker and casino games bill through both houses of the legislature. The problem was that the then-governor vetoed it.
So, when 2019 began with some frustration, Iden turned that into hope with the introduction of HB.4311, the 2019 Lawful Internet Gaming Act. On the other side of the legislature and political aisle, Senator Curtis Hertel Jr. put up SB.186, the partner to Iden’s legislation.
Keep your eyes on Michigan this week! New online poker bills were introduced last week & @BrandtIden will be taking his Lawful Internet Gaming Act to committee this Tuesday. https://t.co/aiVEoYHyeq pic.twitter.com/09r92M70CL
— Legal US Poker (@legal_poker) March 10, 2019
Iden pushed his bill quickly through the House Regulatory Reforms Committee and pass it by a 13-to-1 margin. That moved it to the Ways and Means Committee on March 19. And it has been there since.
Off the Rails
A Ways and Means hearing at the beginning of May brought to light the concerns that would eventually stop the bill in its tracks.
The Michigan Department of Treasury submitted an analysis of online gaming, claiming its legalization would hurt land-based gambling and the lottery. That would subsequently reduce the amount of money going to the School Aid Fund.
Governor Whitmer has relied on this analysis for her dismissal of the bill as well.
Iden tried to argue the point, even agreeing to discuss the possibility of raising the proposed tax rate for online gaming.
Whitmer, on the other hand, proposed a tiered tax rate based on revenue. She also wanted online slot games – the primary revenue driver – removed from the bill.
A stalemate ensued.
Iden repeatedly tried to talk to Whitmer, but she has refused to discuss in person, only sending her staff to talk to Iden.
As of this summer, Iden planned to revisit the issue of online poker and casino games in the fall months, after the budget is in place and other contentious issues are off the table.
Focusing on Sports Betting
With the stalemate firmly in place over online gaming, Iden turned his attention to another issue: sports betting. And instead of putting the gambling expansion measures together, he is taking online gaming off the table for the foreseeable future.
HB.4916 is the eighth or ninth draft of the Lawful Sports Betting Act.
The latest on #sportsbetting's legal potential in our beloved State of Michigan features the "Lawful Sports Betting Act" as a legit backup plan. Appreciate your legislative work, @BrandtIden! https://t.co/Bom6j6jMQU
— Jaime M. Miettinen (@SportsLawBlonde) October 3, 2019
When Iden introduced it in early September, it was worded to allow any entity holding a sports betting license to also obtain an internet gaming license. The bill was tied to HB.4311.
However, the latest version, per Legal Sports Report, removed that stipulation.
“I didn’t want to put us in a situation that sports betting didn’t pass simply because internet gaming doesn’t pass,” Iden told Legal Sports Report. This should insulate sports betting from a veto by not being tie-barred to iGaming.”
This is not acceptable to Whitmer either, apparently. Whitmer disagrees with the tax rate and licensing fees proposed by Iden. Though he did make concessions for her in the latest draft of the bill, it wasn’t enough to bring Whitmer to the negotiating table.
Iden Plans to Push
According to Iden in the aforementioned interview, he does plan to package the sports betting and online gaming bills together and push through the House and Senate.
“If it gets to the point where we have to go without the governor’s support, we may have to go down a road where we can just get sports done,” he said. “I have tremendous bipartisan support. I will go as far as to say I think I probably have the votes for a veto override if she does veto the bill.”
ABC7 Detroit (WXYZ) reported that Iden’s primary incentive to pass sports betting is to protect consumers. Most Michigan residents that want to place a sports wager online can do it through offshore betting sites that are not regulated in Michigan. “Folks need to be protected from those kinds of bad actors in the marketplace.”
That news outlet did receive a statement from Whitmer’s office that they are open to further discussion despite concerns with the “fiscal implication with this legislation.”
Whitmer continues to be concerned that any new types of betting – this time, sports betting instead of online gambling – will negatively affect the School Aid Fund.
The two parties still need to find middle ground on the tax rate. Whitmer proposed 15%, but Iden’s bill put it at 8%. This is an additional 3.25% tax for Detroit establishments. But Iden said he’s willing to negotiate.