“Throughout the month of October, I’m hoping to gain a lot of headway,” Iden said. “If I had my way, we’ll be able to get everyone to the table and put a bill together and through the House before the Thanksgiving holiday. We’ll see how achievable it is, but that’s my goal.”
It would be an incredible achievement to go from the hearing Iden held Sept. 13 in his House Regulatory Reform Committee to House passage in a little over two months.
None of the three commercial casinos located in Detroit – MGM Grand Detroit, Greektown Casino and MotorCity Casino – nor the 12 tribes that operate 23 gambling facilities testified at the informational hearing. However, one tribe and the three commercial casinos did offer written notice that they opposed the bill as written.
Getting the casinos on board
Iden believes that the gaming interests in Michigan want to have the online option approved, it’s just a matter of working out the details between the three corporate casinos in Detroit and the tribal casinos.
“I really believe that the industry understands that things have got to move in this direction,” Iden said. “They’re constantly looking to expand their operations with new gamers. They realize they have generations of gamers that are going to be looking at new platforms, and if they don’t get on board they will miss bus.”
In his conversations with stakeholders, Iden attests that they are all working from the premise that revenues are down, and ventures are needed to bring gamers to the table under new platforms.
Iden said he has sent written requests to tribal councils to submit changes they would like to see in the legislation. He will continue to meet with stakeholders in the industry during October.
“I’m telling them, ‘I have the desire to work with you to make this legislation right, but if you don’t come forward we’re going to proceed anyway,’ ” Iden said. “I think the message is starting to resonate. I’m not naïve. I do understand there are some hoops we’ll have to jump through so everyone believes it is equitable.”
Tribal sovereignty remains main issue
The state of Michigan does not have general regulatory authority over tribal casinos. Instead, the National Indian Gaming Commission and the government of the tribal community regulate tribal casinos.
Tribes then sign into individual compacts in which they agree to pay the state a sliding percentage of net win in return for exclusivity and other benefits provided.
“You have these sovereign nations trying to compete, and vice versa, with corporate gaming facilities regulated by the state of Michigan, regulated by the gaming control board, then these sovereign lands which aren’t,” Iden said. “I believe that there is a middle ground that can be reached.”
Differences between legislative chambers
Iden noted that he is working with Sen. Mike Kowall, who introduced iGaming legislation earlier in the year.
“It was a little stalled over there, so we’re hoping to jump start things by getting it through the House side first,” Iden said.
Iden’s legislation does not require tribes to waive sovereign immunity to conduct internet gaming as is required in the Senate bill.
Instead, Iden’s bill sets up for the tribal gaming operators to renegotiate their compacts with the state in order to offer online gaming. This is more acceptable to the tribes than waiving sovereignty, but compacts would still have to be reached where neither the tribes nor the commercial casinos feel the other side has an unfair advantage.
“I’m confident if we’re able to come to an agreeable spot where everyone feels like they didn’t win everything but they each got a little bit, we can get this out of the legislature,” Iden said.
Another difference is the tax rate. His bill is at 15 percent compared to the 10 percent in Kowall’s legislation. Five percent seems like a small amount to overcome compared to the huge difference between House and Senate proposals in Pennsylvania this year.
Prospects in the legislature
Earlier this year, the Michigan House passed an online horse betting bill. The bill remains in the Senate, where Iden believes there is support to put it on the governor’s desk.
Iden concludes that if the body as a whole believes in moving forward on online horse racing, it should support moving forward on other avenues for online gambling.
But he says passage won’t happen without full support from Michigan casinos.
“If we’re unable to get the tribes and corporations together with framework agreeable to all, it won’t be able to get through the House,” Iden said. “Getting through the committee is the easy part, but getting through the full House is different, and we’ll need support from all the casinos to do that.”
Iden indicated that conversations with stakeholders have been productive thus far, with parties showing good intentions to work with him and no one walking away from the table. He didn’t want to outline points of disagreement that are in flux, but noted that there are a number of things all sides like in the bill, along with expected issues.
As has been demonstrated in California, getting stakeholders to agree on most parameters of a bill is easy, but tribes in The Golden State have proven willing to fully dig in on one or two points of contention.
Iden is undeterred, though he indicated that he doesn’t plan to move the bill through the committee until there is a consensus on language that works for everybody, preferring not to have it stall on the House floor.
“I want Michigan to be an iGaming model,” Iden said. “I want other states as they begin to come on board, because it will continue to happen, to say look what Michigan did, they’ve gone through the perils of this, worked through issues with tribes and others, and come up with model legislation.”