Michigan still had obstacles to overcome, including an election year

Revamped Michigan Online Gambling Bill Still Faces The Same Problems

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After falling off the radar, Michigan has reentered the online gambling conversation, with a new draft of H4926, an online gaming bill.

The bill’s sponsor, Rep. Brandt Iden, told Online Poker Report he was hopeful the legislation would pass the House before May 8. That deadline has come and gone, and Iden is now shooting to get the bill passed before the legislature’s summer recess on June 21.

That still seems like an overly aggressive timeline, considering the entire House of Representatives will spend its summer recess campaigning for the November election. Having to field questions or defend a vote on gambling is something most lawmakers seeking reelection would like to avoid.

As such, it seems unlikely H4926 comes up until the post-election lame-duck session, if at all.

Same old song and dance in Michigan

This MI online gambling effort gets dusted off every few months but never seems to go anywhere.

New bills surface, or existing bills reappear with adjustments that try to appease the state’s gaming tribes and commercial casinos. The legislation usually comes with optimistic rhetoric about its chances of passing from a key lawmaker, before it’s eventually placed back on the shelf.

Like previous efforts, it looks like the latest changes to Iden’s bill aren’t enough to win the support of both the tribes and the commercial casinos.

Iden was bombarded with questions by his colleagues, and failed to win over representatives in districts with tribal casinos, according to earlier reporting by OPR.

Tribes have been a tough nut to crack

States with both tribal and commercial casinos have proven to be an impossible needle for online gaming bills to thread. Online poker legislation in California is the best example of this dynamic, but Michigan seems ready to give the Golden State a run for its money as the most frustrating state for online gambling legislation.

Not surprisingly, the four states that have passed online gaming legislation — New Jersey, Delaware, Nevada and Pennsylvania — are devoid of tribal casinos.

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A larger problem still looms

Even more problematic than winning over the support of tribal casinos is Iden’s adamant claim that legalization of online gambling doesn’t represent an expansion of gaming, and therefore doesn’t require a constitutional amendment to become law.

“One of the things I’m trying to address is that the legislation is constitutional, that it merely regulates what is going on in the black market currently,” Iden told OPR. “Once I get them comfortable with that, the Speaker included, I think things will certainly be easier.”

Based on his full statement to OPR, Iden appears to be conflating other non-related court cases with server location.

Several states that require a constitutional amendment to expand gaming have questioned if locating the online gambling servers in a location already authorized to conduct gambling represents a new game, or an expansion of gambling.

New York seems to believe it would be an expansion of gambling, since the state has eschewed the lucrative opportunities of online casinos and focused its efforts on online poker, which will be classified as a game of skill to avoid a constitutional amendment.

No amendment needed?

Iden disagrees.

“I believe the bill we will pass and the governor signs will be a bill that’s fully constitutional and will withstand a court challenge. I expect opponents of the legislation will want it to go in front of the courts as they have in other states, and they will lose as they lost in other states. Opponents have tried to discredit this issue, engaging members in those states and making a case for the bill not being constitutional, and at the end of the day they have lost that argument time and time again. I’m confident that if they try it on my bill that they will lose again.”

Iden’s opinion not only flies in the face of opponents of the bill and other states, it’s also at odds with analysis by local legal experts that spoke with GamblingCompliance (paywall).

According to GC’s reporting, “the main legal argument — that a public vote is necessary for internet gambling legislation to become law in Michigan — is sound and could prove persuasive in potential state court battles over online gaming policy.”

Add it all up and…

… passing an online gaming bill in 2018 is growing increasingly less likely in Michigan. But there’s always hope as long as there is an active bill.

- 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.
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