Only Seven Shared Session Days Remain For The MI Legislature To Legalize Online Gambling In 2016

Online Gambling Supporters Shift Attention To Michigan As Legislative Clock Winds Down

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Time has run out on the Pennsylvania legislature, and barring a special session, online gambling legalization is on hold until 2017 in the Keystone State.

The Pennsylvania legislature’s session came to an end on Wednesday. And the online gambling bill that has passed the House of Representatives not once but twice is still awaiting action by the Senate.

But Pennsylvania wasn’t online gambling’s only hope in 2016, as another sizable state has led an understated effort to get legislation across the finish line.

For online gambling, the other is Michigan.

The Michigan online gambling bill

In April, Michigan State Senator Mike Kowall introduced SB 889, a bill that would legalize and regulate online gambling.

The bill was similar to online gambling bills introduced in other states, with only one minor deviation, in that the number of licenses would be limited. This number was later revised down to just three licenses in the most recent version of the bill.

Other critical components of the bill as follows:

  • The license application fee is set at $100,000, and the license fee at $5 million. The license fee would act as an advance payment on internet wagering taxes.
  • Significant vendors are required to pay an application fee of up to $100,000.
  • License candidates are limited to casino licensees, or under certain conditions, a Michigan Indian tribe that operates a gaming facility.
  • Licenses would be valid for five years, and are renewable for three and then five-year periods.
  • The tax rate on gross gaming revenue from internet gaming is 10 percent.
  • Set up a Division of Internet Gaming in the Michigan Gaming Control Board, provided with powers to execute the bill’s provisions.

One interesting provision reads, “Allow a wager to be accepted from an individual not physically present in the State if certain conditions were met.” Presumably, this is a means of opening the door for Michigan to forge interstate compacts with other states down the line.

Click here to view all the particulars of the bill.

A hearing and a favorable committee report

On May 4, the Michigan Regulatory Reform Committee held an informational hearing on online gambling and SB 889.

The hearing saw representatives from the Poker Players Alliance and PokerStars discuss some of the benefits of online gambling legalization. Also discussed were the methods and technology online poker sites have in place to ensure they are in compliance with the regulations governing the industry.

On June 9, SB 889 and a substitute bill were “reported favorably” by the Regulatory Reform Committee by a vote of 8-1, and referred to the Committee of the Whole – a parliamentary term for the whole chamber becoming a de facto committee capable of working on the bill.

In effect, SB 889 could be passed by the Senate at any time.

How much time is left?

With the session winding down, SB 889 is back in the spotlight, and advocates are hoping a late push will get the bill across the finish line.

From the outset, Senator Kowall has stated that the most likely path forward for SB 889 would be at the tail end of the session, post-election. As late as October, Kowall’s office was still bullish on the bill’s chances of passing in 2016.

Here’s what the legislature is working with:

  • The Michigan legislature is in session through the end of the year, and the Senate currently has ten scheduled session days – December 1, 6, 7, 8, 13, 14, 15, 20, 21, and 22.
  • The House of Representatives has seven scheduled days, December 1, 6, 7, 8, 13, 14, and 15.

Sources indicate that the first scheduled date, December 1, will not see action on the bill, but that there is still enough time this session to get online gambling legislation through.

For the House of Representatives to have time to do its due diligence, and likely debate and whip up support for the measure, it’s imperative for the Senate to pass the online gambling bill as soon as possible.

Although, it’s impossible to know how much behind the scenes talk has taken place in either chamber over the past six months.

Image credit: Jason Grindle / Shutterstock.com

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Steve Ruddock
- Steve covers nearly every angle of online poker in his job as a full-time freelance poker writer. His primary focus for OPR is the developing legal and legislative picture for regulated US online poker and gambling.