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Michigan Online Gambling Regulation Looking Up After Hearing

Posted on by John Lathram

MichiganA committee hearing in Michigan to consider the regulation of online gambling has lawmakers and onlookers flush with positivity on the prospects of approval.

The March 12 House Regulatory Reform Committee hearing saw Wolverine State lawmakers look at several pieces of legislation, with the 2019 Lawful Internet Gaming Act chief among the proposals. That measure has been introduced in both the House and Senate, as Rep. Brandt Iden volleyed HB 4311 in the former, while Sen. Curtis Hertel Jr. did so with SB 186 in the latter chamber.

Both bills are quite similar to legislation that the House and Senate approved on the back end of 2018, only to fall victim to a veto stamp by former Michigan Governor Rick Snyder, who spoke of “unknown budget concerns” tied in with a possible decrease in Michigan Lottery revenue upon nixing the measure. With Snyder no longer manning the office and new Governor Gretchen Whitmer now occupying the seat, the chances of eventual approval are looking much better.

In addition to a new governor in 2019, there was also a changing of the guard in the Michigan legislature following the 2018 elections, with many new lawmakers supplanting the old. Getting the newbies up to speed on the online poker and gambling issue appears not to have been an arduous task.

License Fees and Tax Rates

The rookie lawmakers learned that the i-gaming bills specify a license fee of $200,000 on operators. Each renewal thereafter will be $100,000 per year. A modest tax rate of 8% will be applied to gross gaming revenue.

Also key to eventual passage is the fact that Detroit’s trio of major casinos are on board with the legislation, earnestly expecting greater profits after studying New Jersey’s online poker and gambling regime that has been in place for half a decade. The Motor City, MGM and Greektown casinos all had representatives in attendance and providing testimony at the hearing.

Lending his expertise as well was former Poker Players Alliance Executive Director John Pappas. His resignation from the PPA did not keep Pappas away, as he spoke about the technology that allows regulated states to spot and exclude players who may be trying to log on and gamble from outside of a given state’s boundaries.

Consumer Protection

More positive vibes came from one of the bill’s sponsors, Rep. Iden, who talked at length about the fact that online gambling legislation had tremendous support last year (except from the former governor) and the need to protect consumers who are already gambling at unregulated sites. Hand in hand with that protection is the ability to obtain revenue from the state’s citizenry, with an eye toward the future and remaining competitive with other states.

Concerns from some that online gambling would lessen revenue obtained via the lottery or at bricks and mortar casinos was pooh-poohed by Iden, who told The Detroit News that the i-gaming demographic is younger than the gamblers who typically visit casinos or buy lottery tickets.

It appears that Gov. Whitmer may look more favorably on online poker and gambling legislation than her predecessor. The issue could get another look by a legislative committee very soon.

Michigan seems to be as serious about online poker and gambling as West Virginia. Both states are now among the favorites to join Nevada, Delaware, New Jersey and Pennsylvania in approving regulation.

Still of some concern is the recent DoJ opinion on the Wire Act. But with legal challenges in the offing and many experts of the mind that that opinion will be struck down, it seems that all systems are go for Michigan online poker and gambling regulation.

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