Michigan Sports Betting Bill Passes Senate Panel

Michigan Sports Betting Bill Passes Senate Panel

After receiving support from tribal casinos just days ago, a Michigan state Senate panel has passed a series of gaming bills that include regulations for sports betting after negotiating more agreeable terms with Governor Gretchen Whitmer’s administration.

The amended bills passed a Senate panel on Tuesday morning and would significantly alter the gaming industry in Michigan. Next, the new bill will have to pass the Michigan Senate and House before the governor will have the final say on whether the bill becomes law or needs more alterations.

Although Gov. Whitmer has previously voiced opposition to sports betting due to possible damage to the state’s School Aid Fund, the governor redirected her support after negotiations this week with lawmakers.

The new bill would allow tax revenue to go to regulatory activities concerning sports betting, a fund for gaming addiction and another fund for first responders dealing with cancer and finally, the School Aid Fund.

As state Senator Curtis Hertel, a Democrat from East Lansing, told The Detroit News, “the intention is to get this to the governor’s desk and have votes today.”

“The reality is right now sports betting is happening in Michigan, millions of dollars is being bet in Michigan every single day,” Hertel said. “Organized crime is the one that actually is winning right now. By providing a legal, safe and regulated system you’re actually taking a big hit to organized crime.”

Source: detriotnews.com

The bill package covers a reduction in restriction on Detroit’s three casinos, legalized sports betting, legalizes online fantasy sports contests and online casino games, and allows for advance-deposit wagering on horse racing.

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What Concessions Did Gov. Whitmer Get in the New Bill?

For Gov. Whitmer’s administration, previous sports betting bills lacked a tax rate that would compensate for the loss of revenue to the School Aid Fund from casinos. The bill’s author, Rep Brandt Iden, initially worked with the governor’s staff to increase the tax rate to mitigate the lost revenue for the fund.

In negotiations with the Senate panel, that the tax rate was raised even further to meet the desires of the governor’s office. The new tax rate is 8.4% on sports betting and daily fantasy sports.

“This is the big revision that Sen. Hertel and the administration I think worked on and found a landing spot,” said Sen. Aric Nesbitt, the chair of the Senate Regulatory Reform Committee.

Source: detriotnews.com

Internet gaming will be taxed even higher under the new bill. The tax rate will be progressive, ranging from 20% to 28% depending on the level of revenue from each gaming operator.

In another odd quirk of the bill, the House and Senate are proposing a reversal of a ban supported by voters in 1996 against casino owners making political donations. To reverse the prohibition, the House and Senate will need 75% majority in each chamber to overturn the law.

Out of all the bills, the ban reversal was the only one that did not receive unanimous support from panel members with two Republican senators in opposition to lifting the restriction.

“The people voted for this in 1996 under Prop E,” Republican Senator Ruth Johnson told fellow panel members. “Because of that proposal passed by the people with that language in it that did eliminate it, I won’t be able to vote for the bill.”

Source: detriotnews.com

If the bill is signed by Gov. Whitmer this week, sports betting could become commonplace in Michigan by late spring or early summer.

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