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Michigan’s chances for interstate online poker are looking way up. Senate Bill 991 passed a Senate floor vote by a wide margin on Wednesday and now needs approval from the House of Representatives and the governor to become law.
SB 991 is a simple bill that doesn’t establish any specifics for interstate poker, only allows for it to be a possibility. It amends last year’s Lawful Internet Gaming Act (LIGA) to add a clause permitting the Michigan Gaming Control Board (MGCB) to enter into compacts for purposes of online poker with regulators in other states, as well as with tribal gaming authorities.
Such permission was included in a more general form in early drafts of LIGA. However, lawmakers stripped it out at the last minute at the behest of the state lottery.
SB 991 passed by a vote of 36-1, and its sponsor, Sen. Curtis Hertel Jr., expects that things will also go smoothly in the House. However, he says it probably won’t get a vote there until late in November.
“I think the bill is a commonsense thing all agreed to and it should move on,” Hertel told PlayMichigan. “I don’t think there’s any controversy. How fast [it will move on], I don’t know. I don’t think it will be before the election. Probably right after.”
Sen. Hertel has been instrumental in Michigan’s gambling expansion efforts from the start. His handling of the interstate poker issue shows how important it is to have legislators involved in the process who are familiar with the industry.
Interstate compacts got cut from LIGA in the first place because of the lottery’s fears that interstate gambling could produce jackpots large enough to hurt its sales of tickets for big draws like Powerball. Although this is a reasonable worry when it comes to linked jackpots for progressive slots, that’s an issue that could have been handled more narrowly.
Poker players realize that this fear doesn’t make sense when applied to poker. They also understand the importance of shared traffic to the viability of a poker ecosystem. Most lawmakers, however, do not, and interstate poker would have wound up as collateral damage were it not for Sen. Hertel’s understanding of the issue.
The same expertise was apparent at SB 991’s committee hearing last week. Another senator, Dan Lauwers, brought a last-minute amendment to the hearing attempting to tie-bar SB 991 to another bill covering historical horse racing (HHR).
That bill is unpopular with the state’s casinos, and Sen. Lauwers believed that tying the two together would help it to pass. However, HHR is a fairly big issue, while interstate poker will have only a tiny impact on casinos’ revenue.
Sen. Hertel is in favor of HHR as well but correctly realized that combining the two would amount to mixing a single grain of sugar with a tablespoon of bitter medicine. That route would have almost certainly caused the casinos to spit both out. He convinced Sen. Lauwers to withdraw the amendment and try a different tack for HHR, averting a probable disaster.
The current timeline for Michigan’s regulatory efforts makes it likely that online sportsbooks, casinos, and poker rooms will start launching in late November. By Sen. Hertel’s estimates, SB 991 could be on Gov. Whitmer‘s desk around the same time. That does not mean, however, that Michigan poker fans will be playing against their peers in other states from day one.
The ongoing federal court battle over the Wire Act is one big reason. If the Department of Justice gets its way, that will make interstate poker illegal, and the MGCB probably won’t want to exercise its ability to enter into compacts until there is clarity on that front.
There’s also a question of which operators will launch in the state and whether they will be ready to offer interstate poker. At the moment, there is exactly one such network in the US, WSOP.com, which serves Nevada, Delaware, and New Jersey. However, WSOP has not yet launched in Pennsylvania and may or may not do so right away in Michigan.
PokerStars, meanwhile, is the sole operator to have opened a poker site in Pennsylvania, but it has no presence in Nevada or Delaware. The Pennsylvania Gaming Control Board (PGCB) won’t even consider interstate poker until the Wire Act battle is settled, and a network comprising only Michigan and New Jersey may not be worth the effort.
While it’s important that SB 991 will hold the door open for shared liquidity, Michigan residents shouldn’t expect it immediately, or even take it as a given that it will come eventually. Realistically, the Wire Act case has to be settled first, and the PGCB needs to get on board. Then negotiations can begin, and that will be a whole process in its own right.