Interstate poker could be a reality for Michigan with more progress

Michigan Online Poker Bill Surging Forward, Reaches Senate Floor

It’s all hands on deck in Michigan as lawmakers and regulators rush to get online gambling off the ground. If all goes well, this should be a week of substantial progress, with two important hearings taking place on Tuesday and Wednesday.

Preparations for launch have been underway since the beginning of the year. Last December, Gov. Gretchen Whitmer affixed her signature to the Lawful Internet Gaming Act (LIGA) and Lawful Sports Betting Act (LSBA), legalizing Michigan online casinos, poker rooms, and sportsbooks.

The road from legalization to launch involves several parallel processes. On the regulatory front, rule-making and license applications are underway simultaneously. At the same time, there’s an additional push taking place in the legislature, to keep the door open for the possibility of interstate poker.

Tuesday’s hearing was a committee meeting in the Senate to vote on that latter bill and advanced to the Senate floor. On Wednesday, the Michigan Gaming Control Board (MGCB) is holding a public hearing to receive questions and feedback on its draft of the iGaming and sports betting rules.

Michigan originally planned to begin all online gambling early next year. Anticipating the possible need to shut down live casino gambling a second time, however, the state is now rushing to try for a launch date before the end of 2020. The most optimistic projects aimed for October, which now seems unlikely, but late November is still very possible.

Full Senate to take on interstate poker

Tuesday’s hearing was an in-person meeting of the Michigan Senate’s Regulatory Reform Committee. Thirteen bills were up for a reading or a vote, including Sen. Curtis Hertel Jr.‘s SB 991.

Hertel told PlayMichigan that he was hoping it would be moved to the House by the end of the month.

SB 991 is a simple bill that merely amends the language of LIGA to permit the MGCB to enter into interstate compacts pertaining to online poker in Michigan. A last-minute change to LIGA, made at the behest of the state lottery, prevented such compacts more generally. The lottery’s concern, however, was linked progressive jackpots for slots, not the sharing of poker liquidity.

The bill received a reading and a chance for public comment at a hearing last week. There were no questions or objections, however. That bodes well for its chances this week. Getting out of committee successfully is only the first step, however. Subsequent votes on the Senate floor and then in the House of Representatives will be more challenging.

“To limit [the poker player pool] to only Michiganders will severely limit the ability of Michiganders to actually find a game that’s interesting,” Sen. Curtis Hertel Jr. said at last week’s hearing. “And it will limit their ability to play in tournaments and all those other things.”

Draft rules up for public discussion on Wednesday

Wednesday’s hearing might be more interesting. Allowing the general public a chance to respond to an almost-final draft of the rules is a mandatory part of the regulatory process.

Because of COVID-19, the hearing will be online only, beginning at 1 p.m. and lasting for three hours. Interested parties can submit feedback in advance, as with the Senate committee meeting, or participate directly using Microsoft Teams.

There’s no vote involved, but it’s hard to predict what sort of response to expect. The draft rules don’t include any particularly strange or problematic requirements. The only inclusions that might raise some eyebrows are the rules about progressive jackpots, seemingly designed to prevent them from growing too large.

The jackpot restrictions are more of an issue for operators than the public, however. They’ve already had the chance to provide their input at an earlier stage of the process. The hearing could therefore go quite smoothly. On the other hand, we could see objections from anti-gambling groups or proposals for more restrictive rules.

What happens at the hearing itself won’t make or break Michigan iGaming, but it’s an important bit of red tape to have out of the way. Public notice was required weeks in advance of the hearing, but scheduling had to wait until the draft was ready. It has therefore been a time-consuming albeit simple step, and the process should go faster from here on.

Next steps for Michigan online gambling

For SB 991, it heads to the Senate floor. There, it could receive a general vote, be sent back to committee, or simply languish if there’s insufficient support. If it does pass in the Senate, it will then go through a similar process in the House and finally to the governor’s desk. As Hertel said, he expects a vote.

There’s plenty of time available for it to make its way through the legislature. The current legislative session wasn’t interrupted by the pandemic and continues until year’s end. Nor is the bill needed for iGaming to launch. The MGCB is busy enough as it is and is unlikely to act on the permissions granted by the bill until well after online poker sites in the state are already operational.

The next step for the iGaming and sports betting rules will be for the MGCB to submit a report to the Joint Committee on Administrative Rules. Meanwhile, the Administrative Rules Division will review the final draft. Finally, the Legislative Service Bureau will have to formally certify them.

A bigger question is what is happening with the licensing process. It hit a snag with the FBI last month relating to access to fingerprint records for the purposes of applicant background checks. MGCB staffers have begun other aspects of the licensing process but can’t yet issue any licenses.

There’s therefore a bit of a footrace happening between the licensing and rules portions of the process. Ideally, both will wrap up simultaneously and allow for a prompt launch, but a delay on either front could hold up the whole thing and jeopardize the chances for Michigan to have online betting and gambling before year’s end.

- Alex is a journalist from Dartmouth, Nova Scotia, Canada. Now site runner for Online Poker Report, he has been writing about poker and the online gambling industry in various capacities since 2014.
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